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Columbia Missourian

Delta decision to end flights a 'matter of fairness'

By Ashley Crawford
November 7, 2012 | 7:48 p.m. CST

COLUMBIA — Delta Air Lines' decision to end flights to and from Columbia Regional Airport in February was a simple matter of fairness, a company spokesman said Wednesday.

City Manager Mike Matthes and Columbia Mayor Bob McDavid announced during a news conference Tuesday that in February Delta would end Columbia flights to and from Memphis and Atlanta. Delta's decision came on the heels of a city announcement that it had reached a deal in which American Airlines would provide flights to and from Chicago and Dallas-Fort Worth in exchange for a two-year, $3 million revenue guarantee and other incentives.

Delta's timeline in Columbia

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Delta spokesman Anthony Black said that didn't seem right.

"We found out about the agreement via the media, and during the entire process (the city) never made us aware they were doing it," Black said.

It was going to create an unfair competitive market, so Delta issued a formal letter to the mayor, Black said. 

"The letter concluded with the statement that if we did not match the agreement with American Airlines that Delta would be forced to exit the Columbia market," McDavid said. 

After learning that Delta was unhappy with the American arrangement, the city offered to provide it a $3 million revenue guarantee beginning in 2014, along with advertising considerations and a waiver of landing fees beginning in 2013. In exchange, the city wanted Delta to fly larger planes.

"Delta wanted a comparable offer, and the one they got put Delta at a competitive disadvantage from Day One," Black said.

Delta had two main problems with the offer.

"One, Delta wouldn't receive any revenue until 2014, almost a full year later (than American), and on top of that they're requiring that Delta put a larger aircraft into service," Black said. 

That request was unwelcome, considering Delta had already voluntarily upgraded its aircraft and service during the years, Black said. 

"We were providing a service for free that the city was concurrently shopping for with other airlines with $3 million," Black said.

The combination of an unfair offer and the city's agreement with a competitor made it easy for Delta to decide to leave Columbia, Black said.

Delta's history with Columbia Regional Airport began in September 2008, when it merged with Northwest Airlines. Northwest at the time was providing three daily flights between Columbia and Memphis International Airport with the help of a $2.2 million annual subsidy under the U.S. Department of Transportation's Essential Air Service program.

The Memphis flights proved so popular, however, that Delta said in 2010 it no longer required the subsidy. Nearly all its flights to and from Memphis were reportedly near capacity. City officials believed the Atlanta flights also would be popular.

Delta, however, informed the city that it actually had been losing $900,000 a year on the Columbia service.

McDavid said Tuesday this was a surprise to city officials. Regardless, Matthes declared in its offer to Delta last week that the market will support nearly 10 times the amount of service it currently receives.

In the offer, Matthes cites several examples as part of the increase, including MU's move to the Southeastern Conference. 

"For example, the Mizzou baseball team needs nearly 50 seats for every one of its away games," Matthes said in the offer. 

Those examples were not enough to convince Delta.

"Our failure to reach an agreement with Delta Air Lines — it was frankly expected by Mr. Matthes and myself," McDavid said.

Supervising editor is Katherine Reed.