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Originally Posted by ATX2030
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With global technology giants such as Samsung and Tesla growing swiftly in the Austin area, the local business community is pushing for more international flights at Austin-Bergstrom International Airport to help support and sustain economic development in the region.
Direct international flights will help companies that are headquartered in Austin and have facilities in other parts of the world, as well as companies based elsewhere that have significant operations in Austin, said Doug Driskill, a Dell Technologies executive who chairs the Austin Chamber of Commerce’s Air Service Task Force.
The task force serves as a liaison between the business community and the airport and airlines to push for international flights to business-friendly locations. In the coming years, Driskill said, Austin is likely to see more direct flights to cities in East Asia, Central America and South America to fill gaps in flight coverage. The Austin airport had just shy of 109,500 international passenger arrivals and departures during June this year.
Being able to easily travel between Austin and other key regions is vital for companies that are considering this area for their headquarters or significant operations, said Matt Geske, vice president of regional and local policy for the Austin Chamber of Commerce.
“When you're recruiting headquarters and headquarters expansion to your region, the need for business travel increases,” Geske said. “You have a lot of businesses that need to get their employees to and from their international headquarters or to some of their suppliers or their factories or manufacturing sites in different areas of the world. It becomes another feather in the cap of that region if they have nonstop service to areas of high business.”
Airlines have expanded domestic flight offerings out of Austin in recent years, and several carriers have filled the gap in direct flights to Europe. British Airways launched a direct route from Austin to London in 2014, and Virgin Atlantic now flies the same route. KLM Royal Dutch Airlines began direct service to Amsterdam in March.
Driskill said having direct flights matters because it saves companies time and money, and it reduces the chance that a travel mishap will disturb plans.
“If it takes you three hops to get to a destination, that's a lot of transit time, right? Just a typical flight to Asia with one stop depending on where you're going can be a minimum of 24 hours,” he said. “The more direct the flights are, and the less connections you have to take, the more efficient and productive businesses can be with their time.”
'A gaping hole in the Austin routes'
Driskill said the task force is currently advocating for more direct flights to South America and especially to East Asia.
Driskill said about 75 companies with operations in Austin have parent companies in Asia — including big players such as Samsung, which is based in South Korea. More than 100 companies headquartered in Austin have operations such as factories in Asia. Those include Austin-based automaker Tesla, which has a major manufacturing facility in China. Round Rock-based Dell Technologies has manufacturing, sales and other teams across India, China, Japan and South Asia, Driskill said.
Samsung's potential growth in the area could play a role in persuading airlines to add direct routes. Samsung already has a multibillion-dollar facility in Austin and has started work on a $17 billion semiconductor factory in Taylor. Samsung also is considering building 11 additional chipmaking facilities in the Austin area over the next two decades, which could lead to nearly $200 billion in new investment and create more than 10,000 jobs, according to documents filed with the state. The company has said it is also considering sites outside of Texas for those facilities.
Kevin Schorr, vice president of Virginia-based Cambell-Hill Aviation Group, said he has seen more support and organization in the Austin business community around attracting direct flights to Asia than ever before. Schorr’s company helps airports pitch new routes to airlines and has been working with the city of Austin since 1998 to help the airport present business cases for new routes to airlines.
“If you look at where we have nonstop service right now, where we don't have nonstop service, you could quickly figure out that Asia is a gaping hole in the Austin routes,” he said. “We are working very closely with community stakeholders, directly with some companies, to make sure that we're putting together the best package possible and putting the best foot forward in our conversations with Asian carriers.”
Schorr said the conversation about direct flights to cities in Asia is picking up steam because Austin's economy has now grown to the point where airlines might consider nonstop service. He said his company has had conversations with multiple airlines about possible routes.
The main issue is always whether a route will be profitable, especially now that staffing and supply chain problems have strained airlines’ bottom lines. Schorr said he can’t say which specific routes airlines might be considering for Austin, but a key factor in attracting airline investment is the state of Austin’s economy.
“We have to show the airlines how well the Austin economy is doing, where people need to go and where they can't get right now either on a nonstop or connecting basis,” he said. “It's really this magic mix of marketing strategy, finance, economics, all those things, to show the airline why this is the next best place to allocate that scarce resource.”
Geske said the chamber conducts a survey among members to give airlines a better idea of what business travel demand exists in the area.
He said his best guess is Austin could see a direct route to a city such as Seoul, South Korea, or Tokyo announced as early as the end of next year. However, he said ongoing coronavirus-related lockdowns in those countries, as well as staff shortages at airlines based in Asia and the United States, are factors that might affect that timeline.
Airport spokesperson Sam Haynes said Austin's airport leaders can't say when more international routes might be added. While the airport pitches possible routes to airlines, the decision to add a route is ultimately not up to the airport.
“We don’t really have any additional info to add beyond that it’s something we know passengers would be interested in,” she said. “We don’t have a year when we expect to land that service, but when we do, we will be sure to share that news far and wide.”
Other benefits from international routes
Adding more direct international flights in the Austin market wouldn't just help with recruiting companies; it would also be a boon to tourism, said Julie Chase, vice president of Visit Austin, the city's convention and visitors bureau.
Chase said Visit Austin serves on the chamber’s task force to help bring more visitors to the area.
“We work with the new flight service to push inbound traffic and mainly on the leisure side,” she said. “The activities we promote are listening to live music, experiencing the outdoors. It's just a different type of destination than maybe most have visited in their first or second trip into the United States.”
Additional international flights into and out of Austin could also help the airport continue its growth as a cargo hub, Geske said. The airport has seen an increase in domestic cargo in recent years, with a 46.3% jump in the first half of this year compared with the first half of last year. The amount of international cargo traveling to Austin dropped by more than 75% during the early part of the pandemic but has rebounded dramatically, with a 2,100% increase between the first half of this year and the first half of last year.
“A lot of people don't think of cargo as being a use of the airport, but it is,” Geske said. “As the airport's building out their cargo capacity, if we can get nonstop service to, say, Korea or Japan, those planes as passenger jets are big enough that you can carry cargo on them. So as manufacturing is picking up here in Austin, that's a sort of a two birds, one stone situation.”
Airport expansion plans
As the business community continues its push to bring more international flights, Austin-Bergstrom is trying to grow to keep up with booming demand.
The chamber's task force says it is supporting airport expansion to help accommodate increased flight volumes in the future.
The airport’s master plan calls for 20 new gates in the main terminal, additional ticketing and baggage space, and 2 million square feet of new terminal and concourse space to be added between 2019 and 2029. The airport has been struggling with capacity issues this year as increased travel demand and understaffing have led to long security lines.
Driskill said the facility expansion will be an important piece of boosting flight service in the coming years, which in turn should lead to more economic growth for Central Texas.
“Our success with connecting human capital, both domestically and internationally, is a winning formula. It's a winning formula economically; it's a winning formula for tourism and leisure travel; it's a winning formula for cultural exchange,” Driskill said. “The active engagement of the city, the business community, the airport and the airlines has been really great. It's been the underpinning of us being able to both attract and retain businesses throughout Central Texas. ... It's a huge part of our growth story.”
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