Thursday, December 10, 2009

Cleveburgh Advantage

Brookings released a report today that is making the new rounds as cities and states assess their migration balance sheets. The big story is the continued decline of geographic mobility. Historically significant, more people are staying put. The Rust Belt tale of the tape:

Pittsburgh posted its smallest decline from net migration in more than a decade, while rising outflows from Buffalo, Cleveland, and Providence moderated after peaking in 2005–2006. The latter two metro areas have among the weakest regional economies in the United States today, however, and their migration fortunes may slip once again as long-distance household mobility begins to rise. (Endnote 10) Yet for the present, their migration patterns are “mirror images” of past years, when many of these residents were lost to fast-growing areas like those in Florida.

The endnote citation:

The diverging fortunes of Cleveland and Pittsburgh is remarkable. How much do the problems in Cleveland drag on Pittsburgh growth? I'd like to know how much market interdependence exists. Inevitably, civic pride clashes with regional economics:

Allegheny County officials plan to aggressively market Pittsburgh International Airport to Greater Clevelanders in their own back yard. The ads will pitch the region's only nonstop flight to Europe.

Pittsburgh plans to roll out its marketing campaign within a few weeks because of Continental Airline's recent decision to drop summer service between Cleveland and London. Continental said the recession hurt the flight's performance. It also blamed an inability to get "economically viable" seasonal takeoff and landing rights at Heathrow Airport.

The head of the Regional Air Service Partnership in Allegheny County said Cleveland's loss could be Pittsburgh's gain.

The TechBelt has three major airport options (including CAK). When marketing this innovation corridor to the rest of the world, demonstrating how these airports compliment each other would be a major selling point. That's wishful thinking on my part:

Cleveland airport and city leaders are mulling how to restore a nonstop to London or mainland Europe out of Hopkins. A group of city, airport and business leaders are heading to Houston in coming weeks to talk to Continental officials about Cleveland's role as a Continental hub.

The most recent episode of NEOtropolis looks at regionalization in Northeast Ohio. The show's introduction references the television market of Western Reserve Public Media. The reach covers the TechBelt geography plus Erie. But the discussion about regionalism is more of the usual Cleveland+ talk. Regardless, the problems highlighted are the same facing the TechBelt. Speaking and acting with one voice is a big help when trying to attract business. I would say the same thing about trying to attract talent. More about that later at Greater Youngstown 2.0.


Stephen Gross said...

Do the 3 airports in fact compliment each other? Maybe, maybe not.

Then again, one thing that makes airports more affordable is competition (which drives down landing fees). Aggressive marketing is one element of competition; perhaps Allegheny's marketing push for PIT will foster more competition among CLE/CAK/PIT, and thus lead to overall lower flight costs. Maybe this is a good thing for the region...?

Jim Russell said...

I think CAK has played a complimentary role, often targeting the business that slips between the cracks of Cleveland and Pittsburgh. Akron/Canton is a wonderful alternative to Pittsburgh or Cleveland.

Being the hub or sporting direct flights to Europe strikes me as more akin to sports stadium boondoggles. There is a certain amount of prestige to having a professional sports franchise.

Keep in mind that we are talking about enough passengers to support these long distance connections. Pittsburgh is subsidizing the flight to Paris in hopes of establishing a sustainable ridership. A split Cleveburgh market doesn't justify the cost from the airline perspective. Together ...

Stephen Gross said...

There's a fine line between too much airport competition and too little.

Too much competition, and everyone becomes a loss leader. Often, each competing airport seeks govt subsidies for expansion, effectively diverting public resources towards ultimately less profitable endeavors.

Too little competition, and user fees go up: parking, landing, warehousing, and of course, tickets! Here in MSP, we face higher-than-market-average ticket prices due in part--IMHO--to lack of regional competition.

CLE for years was a very poorly run airport. I'm glad to see that they have finally wised up and started improving things. I have to believe that part of that was due to CAK/PIT competition.

Jim Russell said...

You know Cleveland better than I do. I see the appeal to Continental as the status quo: Non-competitive pride trumping smart business thinking.

Stephen Gross said...

For a thought experiment, as it were, let's consider an idea: What if instead of CLE/CAK/PIT, there were a single regional airport in the area? Say, somewhere west of Youngstown, so it's equidistant from both metro regions.

What would this mean for the overall region? Transportation to/from the airport from both metros would go up, but maybe ticket prices would go down. Also, there would be more overall flights, and shopping at the airport would get better.

What would you name this airport? Please don't say "Cleveburgh"; the name is starting to grate on me... :)


Jim Russell said...

Call it Cleveland/Pittsburgh International (instead of Akron/Canton) a la Minneapolis/St. Paul. In other words, fly your lean market destinations out of CAK.

Unknown said...

I don't much care for Cleveburgh, either, but Pittsland has a nice ring to it. :-)

More seriously, I think such an airport would be much to far away to be attractive. Remember, we're spending millions of dollars to relabel PA-60 as I-376 just because "they" think that people who make business location decisions are too stupid to realize that PA-60 (in the vicinity of the airport) is a decent road, but they'll assume that I-376 is. Would such people think an airport in the next state was convenient?