OST-97-3034 / US Airways (exemption Pittsburgh-Paris) / Answer of Allegheny County in Support / November 5, 1997

Application of

for an exemption pursuant to 19 USC § 40109 (Pittsburgh-Paris)

PIT has developed into a major airport of regional and national significance. The airport has recently undergone a thorough renovation and is now home to one of the country's most modern and convenient terminals. The addition of nonstop daily service to Paris will serve to enhance the stature of the airport. More importantly, the proposed service will not only serve the immediate Pittsburgh metropolitan area, but will provide the opportunity for direct connections to the over 500 daily flights operated by US Airways that service Pittsburgh International Airport. Due to the size and breadth of the market surrounding Pittsburgh, Western Pennsylvania and the northern Ohio valley, the County respectfully urges that the Department grant the exemption to serve Paris.

In addition, thanks in part to the initiative of US Airways, PIT has seen the potential benefits of becoming a major transatlantic gateway through US Airways' initiation of nonstop service to Frankfurt and online connections to the rest of Europe. The authorization of daily nonstop service to Paris will be an invaluable addition to the efforts of PIT to become one of the nation's premier gateways. Such enhanced status provides the surrounding community, with important increased business opportunities and greater recognition in the international marketplace.

The traveling public has consistently shown its support for Pittsburgh as a transatlantic gateway and the Pittsburgh-Frankfurt route has been overwhelmingly successful. As Paris is one of the top European markets for Pittsburgh, the traveling public will support US Airways' PIT-CDG service. Grant of US Airways' exemption will further the public interest by establishing an alternative gateway to France and the rest of Europe.

Pittsburgh has an existing, substantial base of French-related business. For example. all of the universities and colleges located in Pittsburgh now have students from France enrolled or have had significant numbers of French citizens enrolled. All but one of the fine major academic institutions have exchange programs with schools in France.

The French-American Chamber of Commerce reports significant and increasing commercial relations between Pittsburgh and France. Today, there are 17 French-owned companies (or subsidiaries of French companies) located in the Pittsburgh area. The Chamber also identified five of Pittsburgh's most significant corporations (ALCOA, H. J. Heinz, PPG Industries, Rockwell International, Westinghouse) as having substantial French facilities. Probably the most telling aspect of the Chamber's report is the list of 168 Pittsburgh area companies that either export to France today or are actively pursuing sales to France.

All of these qualitative reports of strong Pittsburgh-France economic activity is not surprising in that Western Pennsylvania is an economic epicenter of the United States. The location of the PIT airport is within 500 miles of (see Exhibit 1):

• 47 % of the total US population

• 47 % of the total US households

• 49% of the total US effective buying income (EBI)

• 51% of the total US households with annual EBI over $50,000

• 47% of the total US retail sales

Exhibit 2 shows that PIT has a passenger catchment of over 5,000,000 passengers drawn from 10 metropolitan areas.

In spite of these economic strengths, Pittsburgh has been seriously disadvantaged by its lack of European aviation access. Exhibit 3 shows that Pittsburgh has non-stop flights to only Frankfurt, while Atlanta, Cincinnati, Detroit, Miami, Newark, Philadelphia and Washington Dulles, all have dramatically better European airline services. The Department can begin to rectify this inequity by granting the US Airways exemption application.

Clearly, US Airways' schedules at PIT (see Exhibit 4) would improve its home base's access to Europe. By virtue of the 113 cities that currently receive nonstop flights to PIT, the Paris flights would benefit all of these markets with convenient connecting schedules. This is a substantial benefit to the traveling public throughout the country. Further, grant of exemption for PIT-CDG service would be supported by the recent history of success at Pittsburgh International Airport. Exhibit 5 shows the growth pattern of enplaned/deplaned passengers over the past fifteen years. A PIT-CDG flight would benefit from the surge of 11,OOO,OOO passengers that now travel to/from/through Pittsburgh that were not flying there 15 years ago; these frequent fliers know and appreciate the convenience of the airport's modern terminal.

While passengers are clearly important to a US Airways PIT-CDG operation, the global growth of cargo demand will be another significant contributor to the economic success of PIT-CDG flights. Exhibit 6 shows the geographic origin/destination markets that can be readily served from Pittsburgh. Exhibit 7 shows the existing base of cargo exports from PIT. With minimal existing air cargo service, a PIT-CDG schedule would likely stimulate the cargo flows to Europe. The reverse trade, see Exhibit 8, would also benefit from nonstop flights to Paris. Exhibit 9 shows the total tonnage of Pittsburgh origin/destination cargo; the current European market (over 300,000,000 pounds) would increase if US Airways initiated the service. Very little (1.2%) of this traffic currently departs from/arrives at Pittsburgh (Exhibits 10 and 11). Grant of US Airways' petition will result in providing Pittsburgh greater access to the global air cargo markets and such an efficient link to Europe will contribute to the competitiveness of Pittsburgh's products.

The annual impact of daily nonstop B767 service to France is estimated to provide 5242.2 million annual benefit to the region's economy alone (see Exhibit 12). The local. regional, and national economies will benefit from increases in trade, jobs, investments business travel, tourism and hospitality. US Airways' flights will provide 148,190 available seats for business and leisure travelers to visit and invest in the Pittsburgh area. Assuming an 807 load factor and an estimated share of 45% Pittsburgh origin and destination traffic, the service vat ill provide 53,000 passengers to the Pittsburgh area each year. This extremely positive economic impact above should justify the Department's decision to grant US Airways' exemption petition.

WHEREFORE, for all the above-stated reasons, the County respectfully requests that the Department grant the US Airways application for exemption to engage in scheduled foreign air transportation of persons, property and mail between Pittsburgh, Pennsylvania and Paris, France.

Respectfully submitted,

Gary Bishop, Director
Theodore Trbovich, Assistant County Solicitor
Pittsburgh International Airport

ALLEGHENY COUNTY DEPARTMENT OF AVIATION