Public, private alliance raises money to entice low-cost airline

Public, private alliance raises money to entice low-cost airline to Knoxville

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Market research shows about 20 percent of the area's air travelers use a different airport. Market research shows about 20 percent of the area's air travelers use a different airport.
The group called Competitive Airfare Partnership announced the effort Wednesday at McGhee Tyson Airport. The group called Competitive Airfare Partnership announced the effort Wednesday at McGhee Tyson Airport.

By MIKE KRAFCIK
6 News Reporter

ALCOA (WATE) - An alliance of government and private organizations has begun a push to bring lower airfares to McGhee Tyson Airport.

The group called Competitive Airfare Partnership announced Wednesday a fundraising goal of $3 million has been set to recruit a low cost airline to fly here. The money will be collected from private and public sources.

"This is something we know we're going to have generate proceeds, so we have a seat at the table, so we can be legitimate with those carriers to let them know, we mean business, we want you here," said Mitch Steenrod, chairman of the board for the Knoxville Chamber.

Steenrod said the money raised will serve as an incentive to attract the low-fare airline.

He said a steering committee from Innovation Valley will vet the various requests from different airlines.

"That request will be clearly vetted to make sure it will be the right carrier with which we want to partner, with which we want to support," he said.

The partnership includes The City of Knoxville, Knox County Innovation Valley, the Metropolitan Knoxville Airport Authority, and the Knoxville Chamber.

The organizers say this is the first time an effort to attract a low-cost airline with financial incentives has been attempted. The approach has been used successfully in other areas, such as in Greenville and Charleston in South Carolina.

So far, $650,000 of that money has been committed already, with $370,000 coming from the city and county governments.

Visit Knoxville has pledged $200,000 toward the partnership.

Knoxville Mayor Madeline Rogero has pledged $170,000 in her proposed budget, and Knox County Mayor Tim Burchett pledged $200,000.  

"It's the very start of it, but I think it shows businesses and airlines we're at the table, and we're serious, and we're ready to talk," Burchett said.  

Steenrod is also the CFO of Pilot Flying J, the Knoxville based truck stop chain. He said the company has been willing to pledge up to $75,000.

There have been no firm commitments from the private sector.

"I think we'll get commitment out of the private sector, but we're also going to need further commitment out of the public sector beyond Knox County and Knoxville," Steenrod said.

The funds will be used as seed money to entice an airline like JetBlue or Southwest to fly in and out of McGhee Tyson.     

The Competitive Airfare Partnership is mounting the effort because market research shows about 20 percent of the area's air travelers use a different airport.

Organizers say 200 to 400 more passengers a day would use McGhee Tyson if lower cost fares were available.

The partnership is in the beginning stages of securing private sector money.

"We know competitive airfares stimulate growth, and directly impact the bottom line for businesses and leisure travelers," said Knoxville Mayor Madeline Rogero.

Patrick Simmons travels to Oak Ridge for business and says he would come here even more, if he could find cheaper fares. 

"It'd make my business easier to run, it would allow us to train more folks, and obviously if I send more people, they'll spend more money in the area," Simmons said.

Figures from the U.S. Transportation Department show McGhee Tyson has the eighth highest average domestic ticket price of any airport in the nation

In the 4th quarter of 2012, the average was $463.00, compared to the national average of $374.00. 

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