The Economic Impact of Direct Flights
Edmonton International Airport direct flight map.
How much value do you place on the accessibility of a City when you think of its potential for growth and development?
I would say that is one of the most important factors, for this puts a city on the world stage in terms of possibility. I would also say that this is one area that we are heavily lacking in Edmonton and on a broader scale in Alberta, however Calgary has managed to tackle this much better. Edmonton has recognized the growth of our City and need for airport development, and as such, began work on its expansion of the Edmonton International Airport in 2012 with the "development of a newly expanded apron (150,000 SF), an expanded air terminal building (9 new aircraft bridges), a combined office tower and air traffic control tower (LEED Certified Gold), a new power substation (located in the southeast section of the property) and a major expansion of the existing Central Utilities Plant" (EIA Masterplan). EIA is expecting over 31 Million passengers by 2035 and so has developed a Master Plan that stretches over the next 20 years and plans for this growth and development of the airport, which is highly commendable. So far, the EIA has done a tremendous job with these updates.
However, currently, Edmonton is lacking in the direct flights department, and it is hindering our ability to recruit business from other markets, such as the tech industry from San Francisco. See the chart below for a comparison of the current direct flights offered in/out of Edmonton compared to our southern sister, Calgary. We are weaker in the number of international flights, and furthermore, Calgary heavily services Europe and United States, with a couple flights to Asia. Edmonton on the other hand seems to specialize in Mexico & the Caribbean. We are servicing the winter holiday destinations, but not the business centres of the world.
Calgary(YYC)
EUROPE (8)
- Zurich, Switzerland
- Munich, Germany
- Paris, France
- Frankfurt-am-Main, Germany
- Glasgow, United Kingdom
- London, United Kingdom
- Manchester, United Kingdom
- Amsterdam, Netherlands
MEXICO/CARIBBEAN/CENTRAL AMERICA (7)
- Cancún, Mexico
- Mazatlán, Mexico
- Mexico City, Mexico
- Puerto Vallarta, Mexico
- San José del Cabo, Mexico
- Santa Clara, Cuba
- Varadero, Cuba
ASIA (2)
Seoul, South Korea
- Tokyo, Japan
UNITED STATES (16)
- Chicago, United States
- Dallas-Fort Worth, United States
- Denver, United States
- Houston, United States
- Las Vegas, United States
- Los Angeles, United States
- Minneapolis, United States
- Newark, United States
- Orlando, United States
- Palm Springs, United States
- Phoenix, United States
- Portland, United States
- Salt Lake City, United States
- San Diego, United States
- San Francisco, United States
- Seattle, United States
Edmonton (YEG)
EUROPE (3)
- Amsterdam, Netherlands
- London, United Kingdom (recently cut back by Westjet (CBC.ca))
- Reykjavik, Iceland
MEXICO/CARIBBEAN/CENTRAL AMERICA (12)
- Cabo San Lucas, Mexico
- Cancun, Mexico
- Cayo Coco, Bahamas
- Freeport (Grand Bahama Island), Bahamas
- Liberia, Costa Rica
- Manzanillo, Mexico
- Mazatlan, Central America
- Montego Bay, Jamaica
- Puerto Vallarta, Mexico
- Punta Cana, Dominican Republic
- Santa Clara, Cuba
- Varadero, Cuba
ASIA (0)
N/A
UNITED STATES (11)
- Denver, United States
- Houston, United States
- Las Vegas, United States
- Los Angeles, United States
- Maui, United States
- Minneapolis, United States
- Orlando, United States
- Palm Springs, United States
- Phoenix, United States
- Phoenix – Mesa, United States
- Seattle, United States
I found a study online that looks at this topic and it quantified the problem statistically by measuring the effect of direct flights on visitor flows in a model titled Quandt and Baumol (1966). "They argue that the volume of travel between any two cities is a function of origin and destination characteristics as well as the money and time costs of travel between them" (Bath.ac.uk). By providing more direct flights in and out of a City, this lowers the money and time costs of travel between them, thus increasing the volume of travelers.
The costs of airport expansion to accommodate more direct flights are large though, and include items such as larger terminal facilities, staffing growth, and extending the runways to ensure capacity for the landings and takeoffs of fully loaded wide-bodied airplanes. So who pays for this cost? In a market that is already high cost throughout Canada, assigning more costs to the airlines who thereby pass through more costs to the purchasers, is not ideal. In fact, Canada is the only major air market in the world without an ultra low-cost airline (Financial Post)! This begs the question of protectionism and have we done too much within Canada to protect Canadian airlines that have been charging more and more for a less quality service. The following chart shows the monopoly that Air Canada and Westjet have over the Canadian market, depicting exactly why we need more competition in this free market.
Overall, Edmonton would reap huge advantages if we were more accessible on a global scale to potential business partners in a variety of industries, but especially technology and software which we are expecting to grow heavily over the coming years. In fact, Calgary just saw the absorption and lease of 75,000 SF of downtown office space as they recruited RocketSpace, a tech company out of San Francisco's Silicon Valley, a city they currently service with direct flights (CBC.ca).
What can we do to expand our accessibility to Edmonton and do you think more direct flights are a possible solution?