Houston optimistic on passenger upswing after downturn in oil sector pressured premium travel demand

Houston’s airport system is optimistic passenger levels could stabilise for Houston Intercontinental in 2018 after a downturn in the oil sector pressured premium traffic. Data from CAPA – Centre for Aviation shows the airport’s passenger numbers fell -3.1% and -2.4% in 2016 and 2017, respectively, as a decline in oil prices created challenges for the oil sector, which is a huge driver of Houston’s economy.


Summary:

  • Houston George Bush Intercontinental Airport has been hit by the downturn in the oil sector with traffic declining -3.1% and -2.4% in 2016 and 2017, but has returned to growth in Q1 2018 with passenger numbers up +1.5% versus last year;
  • Houston William P Hobby Airport continues to grow with passenger levels up in +6.1% in 2016 and +4.1% 2017 and up to +6.9% in Q1 2018;
  • Despite requests to extend the runways at Houston Hobby Airport, there are no immediate plans to expand them with Hobby remaining a regional facility for the Americas region;
  • VIDEO – interview with Mario Diaz, the director of the Houston Airport System.

Speaking to CAPA TV at the recent CAPA Americas Summit in Houston, Mario Diaz, the director of the Houston Airport System stated with the stall in the energy sector there was falloff in travel in premium classes. “If there is a scent of oil,” he explained, Houston’s companies travel there in droves “and that has tapered off”.

Mr Diaz stated there are other parts of Houston’s economy that took over that “kept traffic at least at an even level,” but in the first quarter of 2018 Houston is beginning to see a pick-up in traffic.

Houston Hobby’s passenger levels grew solidly in 2016 an 2017 at 6% and 4%, respectively. The opening of a new international terminal at Hobby in 2015 has brought down prices and increased the number of seats “and we are delighted about it”. Mr Diaz said. Prior to the terminal’s opening in 2012 fares from Chicago to Caracas, Venezuela were roughly USD700 versus USD1200 from Houston to Caracas. “The opening of Hobby as a second regional airport of the Americas has really opened up Latin America,” Mr Diaz concluded.

Southwest currently operates service from Hobby to Belize, Costa Rica, Jamaica and Mexico. During 2017, roughly 885,400 passengers travelled on international flights from the airport.

Although Mr Diaz has received request to extend the runways at Hobby, he told conference attendees the answer is “no”, explaining Hobby would remain a regional airport for the Americas.