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AIRPORT PROFILES Last modified on December 23, 2019

On the radar

CEO, Brian Ryks, tells Joe Bates more about an exciting year of growth and development at Minneapolis-St Paul International Airport.

With the US’s high profile hubs grabbing most of the headlines, it is perhaps easy to overlook the country’s growing list of successful mid-size gateways and the key role they play in the nation’s air transport system, and Minneapolis-St Paul International Airport (MSP) is no exception.

How many of you, for example, are aware that MSP is the US’s 16th busiest airport and that after three record years of growth it is on target to handle 39 million passengers for the first time in 2019?

It already handles more passengers on an annual basis that Boston Logan (BOS), Detroit Metro (DTW), Philadelphia (PHL) and New York LaGuardia (LGA), and if it continues to grow at the current rate of around  3% per annum for much longer, could soon overtake the likes of Newark Liberty (EWR), Orlando International (MCO), Seattle-Tacoma (SEA) and even Houston–George Bush Intercontinental (IAH).
MSP tarmac
Indeed, it has one of the fastest growing route networks of the US’s top 30 airports with more than 50 new routes since 2016, including three new international services (Dublin, Seoul and Mexico City) introduced over the last year.

The new additions mean that MSP enjoys competition on 58 of its 168 direct routes, and its growing number of international services ensure that MSP and the twin cities of Minneapolis and Saint Paul, in the US state of Minnesota, are becoming better known across the globe.

MSP is also a customer service champion, topping the podium for the best airport in North America in the 25-40mppa category in ACI’s Airport Service Quality (ASQ) customer satisfaction awards for three years running.

And it is a huge economic engine for the region, generating $16 billion in economic activity in 2017, $7.1 billion of it directly as it is responsible for some 86,900 jobs across the state.

So, it is fair to say that MSP is doing pretty well, and increasingly on the radar of international airlines. However, with its facilities already experiencing peak time congestion, and its own analysis showing that there is plenty of scope to further increase its international route network, the airport’s operator, the Metropolitan Airports Commission (MAC), is acutely aware that its job is far from done.
MSP runway

“We have had an exceptional year of growth, with passenger numbers up around 3.4% in the year to date, and an extraordinary 7% in the month of September, meaning that we are on target to handle an all-time high of 39 million passengers in 2019,” enthuses MAC CEO, Brian Ryks.

“We are in a good place, but with success comes challenges as rising demand inevitably puts pressure on your existing infrastructure. The airlines are healthy and investing [in new aircraft] and want us to invest more.

“I understand this, but honestly, when we went through our budgeting and capital improvement programme planning process, looking towards 2020, we had $100 million more in need that we could accommodate, so it has become very challenging to come up with the dollars needed to do everything the airlines and our stakeholders and partners want us to do here.”

 

Traffic growth

Ryks attributes this year’s upturn in traffic to a number of factors ranging from a healthy local economy to the increase in capacity offered by MSP’s airlines, noting that in the fourth quarter alone, hub carriers Delta Air Lines and Sun Country Airlines offered 6% and 43% more seats respectively.

The rise in seats is down to new routes and the upgauging of aircraft or increased frequencies on existing ones, with Ryks quick to point out that you are a lot more likely to see B737s than 50 seat regional jets at Minneapolis-St Paul today.

“The fantastic new Delta services to Seoul and Mexico City and new Aer Lingus service to Dublin have also helped,” says Ryks. “In addition to being wonderful destinations, Delta’s SkyTeam partners Korean Air and Aeroméxico provide excellent connecting opportunities through Incheon and Mexico City respectively, while new entrant Aer Lingus tells me that their daily Dublin-Minneapolis service has proved to be one of its most successful route launches in North America.”
Snow
Aer Lingus is the twelfth new airline to launch services to MSP since 2016, during which time the airport has also added Amsterdam, Aruba, Reykjavik and Tokyo to its international route network and 45 domestic destinations, 11 of them being introduced this year.

Nassau in the Bahamas will join them on December 21, 2019, when homebased airline and ultra-low-cost carrier, Sun Country, launches a once weekly service between MSP and Lynden Pindling International Airport.

The new additions are certainly no fluke as by Ryks’ own admission, MSP has become “more aggressive” in its approach to air service development in recognition of the growing levels of competition faced from other airports.

This more proactive and ambitious strategy involves regular dialogue with the local business community to find out more about what air links they would like to see launched at MSP today, and up to three years from now.

To help facilitate this dialogue, MAC formed the MSP Regional Air Services Partnership (RASP) initiative in collaboration with GREATER MSP – the economic development organisation for the Twin Cities whose investors include more than 300 companies, organisations and institutions – and it really hasn’t looked back since.
MSP sunny
“I have been here for three-and-a-half years and my focus has always been on taking a more aggressive approach to air service development, whether it’s a new service from Delta and other incumbent carriers or a new entrant to the market, as the importance of a good and ever evolving route network cannot be overestimated,” explains Ryks.

“We went to the business community and essentially said that we wanted them to be our partners in developing new air service opportunities for the region. They liked the idea, so we regularly talk to the CEOs of Minneapolis’ biggest companies about route development,” adds Ryks.

“What’s slightly different about this initiative is that it gives us an insight in to the future. Our own research and DOT [Department of Transportation] data, for example, tells us where people are flying to or coming from today. But what we didn’t know before we set it up was how the expansion plans of these big companies might change this dynamic.

“So, we decided to ask them, and now they tell us. As a result, we now know where people fly to today and where they are likely to want to go to from MSP in one to three years’ time.”

This obviously isn’t the kind of information that companies typically disclose, so it required trust, and the signing of confidentially agreements to get it done, but it proved a masterstroke as it allowed MAC to identify a number of potential new routes that they could pitch to the airlines, one of which was the recently launched international service to Dublin.
Departurers

Without doubt MSP’s route development efforts are helped by the appeal of the Twin Cities’ diverse economy which encompasses everything from banking, bio-sciences, healthcare and clean and renewable energy companies to the manufacturing, agricultural and food businesses.

Indeed, 16 Fortune 500 companies ranging from Cargill, ECOLAB, Xcel Energy, UnitedHealth Group, 3M, General Mills to Target are located in Minnesota.

 

Airlines and changing traffic mix

MSP is Delta’s second largest hub after Hartsfield-Jackson Atlanta (ATL) and this ensures that it is the dominant carrier at the gateway, accounting for around 71% of all passengers. The next biggest airlines in terms of market share are Sun Country (6.4%), American (5.7%), Southwest (5.3%), United (4.3%) and Spirit (3.1%).

With the notable exception of Spirit Airlines, Terminal 1 is exclusively used by the network carriers while Terminal 2 is effectively MSP’s low-cost carrier facility.

O&D services currently account for around 63% of the passengers at MSP and transfer traffic for roughly 37%, which Ryks points out is almost exactly the reverse of the situation a decade ago when Northwest Airlines was the hub carrier and 60% of its passengers caught connecting flights.

He believes that the growth of low-cost and ulta-low cost carriers at MSP in recent years has proved a big factor in the rise in O&D traffic and notes that the changing traffic mix has increased the pressure on the landside areas of the airport such as the entrance roads, parking and ticketing lobby.

All the issues are being addressed or are due to be resolved in MSP’s ongoing $1.7 billion capital development programme, which will end in 2023 with the completion of the revamp of Terminal 1.


Infrastructure development

MAC has never been shy of investing in new infrastructure, adding a fourth runway (Runway 17/35) on the west side of the airport site, a new 10-gate Humphrey Terminal 2, an expanded Terminal 1 and two new concourses under the umbrella of its $3.2 billion 2010 master plan.

In addition, the plan also delivered new roadways; 16,000 new car parking spaces; 12 extra airbridges on Concourse C; new car rental facilities; a transit centre; and two stations to accommodate an airport pit-stop of the light-rail system operating between Minneapolis and the Mall of America.

However, with peak time congestion already rearing its ugly head and forecasts predicting that MSP is likely to be handling more than 50mppa by 2035, more new facilities are needed, and MAC is committed to completing its investment of $1.7 billion for capacity enhancing projects over the next few years and expending up to $2.5 billion by 2035 if demand dictates.

The latest upgrade includes a $400 million ‘operational improvements programme’ to renovate and add 15,000sqft to the ticketing and baggage claim areas in Terminal 1 and a new $250 million complex that will contain a car park and car rental facility capable of accommodating 5,000 vehicles and a transit centre for buses, when it opens in April 2020.
MSP interior
Ryks acknowledges that it might seem strange to some to build another car park at MSP when everything points to parking income declining in the future as less people drive to airports, but he notes that parking generated $94 million in revenue 2018 and that the parking garages adjacent to Terminal 1 regularly run out of space, causing some passengers to miss their flights.

He adds that the airport has factored the possibility of the future decline in parking revenues into its future development plans, and that if this was to happen, one of the options open to MAC would be to demolish the two 40-year old parking structures nearest to Terminal 1 to allow for additional kerb frontage.

Elsewhere in Terminal 1, Ryks reveals that MAC is currently in the planning phase for a third Delta Sky Club Lounge, new retail facilities, and aircraft gates in a modernised and expanded Concourse G.

“I am excited about the multi-phased redevelopment of Terminal 1, which is a transformational project that will provide travellers with a consistent experience from kerb to gate,” he enthuses.

“It will be disruptive, there is no doubt about that, but the revamp is very much needed to ensure that we can ease the pressure on the front of the house caused by the rise in demand for O&D traffic.”
MSP kerb
The ticketing area revamp, which like all the other projects is being carried out while the facility is in use and MSP handles around 105,000 passengers daily, is around 45% to 50% complete.

Facilities already added as part of the ongoing infrastructure development programme include 80 new retail/F&B outlets, a 300-room InterContinental Hotel – a $100 million public-private partnership (PPP) project between MAC and Graves Hospitality – connected to Terminal 1 by a pedestrian skybridge, and four new gates in Terminal 2.

Ryks says that MAC has also reconfigured the security screening operation in T1, working with the TSA to reduce the number of checkpoints from a non-operationally efficient six in the ticketing lobby to two (North and South) consolidated locations.

 

Customer service

Three consecutive years of success in ACI’s annual ASQ customer excellence awards means that it is almost impossible to talk about MSP these days without mentioning its efforts to enhance the airport experience for passengers.

Ryks has no hesitation in stating that providing top quality customer service is a major priority for the airport, noting that it is one of the pillars of MSP’s 2017-2022 strategic plan.

In fact, one of the three key focus areas of the strategic plan is to “deliver a seamless ‘one journey’ experience for MSP passengers”, and its efforts in this regards will certainly be helped by the adoption of new technologies such as smart entry and exit gates, self-service check-in and the planned future introduction of self-bag drop kiosks.
MSP security
The airport recently introduced an IT solution by XOVIS which allows it to track passenger flows and potentially make the best use of staff and other resources by deploying them where they are most needed.

And MAC is a great believer in collecting and analysing data – including that gained during the annual ASQ surveys – to help it enhance its operational efficiency, performance and service offerings, and potentially gain a competitive advantage over other airports.

The opening of new retail/F&B outlets and other facilities with a “local flavour” have helped provide a distinct sense of place feel to MSP’s terminals which have proved popular with travellers, while the long established Customer Service Action Council gives different airport stakeholders the opportunity to meet once a month and work on ways to deliver an even better airport experience.

“We are in the hospitality business as today’s travellers spend more time at airports than ever before and want and expect streamlined journeys and good amenities,” says Ryks.

“If we can give them this, and I am including all passengers when I say this so I also mean those with disabilities and special needs, then they will be happy and we will have done our job.”

 

The next step for MSP

Terminal 1 at Minneapolis-St Paul International Airport was built in 1962 as a shining example of modern engineering and architecture. The iconic long-span ‘folded plate’ roof structure afforded the Metropolitan Airports Commission (MAC) flexibility throughout the years – until recently.

Annual passenger levels reached a record 38 million in 2018 and it was clear the terminal had reached a critical point, unable to accommodate the more than 50mppa projected for 2035.

Alliiance led a team to plan and design the MAC’s vision for their terminal of the future. Primary goals of reducing congestion, increasing capacity, and optimising passenger flow within constrained areas demanded the team challenge prior assumptions and develop space saving innovations.

At the baggage claim level, reworking the vertical circulation allows for a five-metre expansion at the front of the terminal. Although only a 5% increase in floor area, this will enable a 50% increase in claim device capacity. Security checkpoints were consolidated from six to two, and relocated exits reduce passenger decision-making points and congestion.

Centralising and increasing the number, and prominence, of elevators improves the meeting of the diverse needs of passengers, while strategically relocating escalators optimises passenger flow toward each of the security checkpoints.

At the ticket lobby level, the same five-metre expansion reduces congestion by enabling increased capacity at flexible airline areas to meet the evolving demands of modern technologies, avoiding passenger queues’ impact on circulation.

Digital dynamic signage, with current wait time information, help passengers make an informed decision about their route while eliminating inefficient movement within the terminal.

Through innovative planning and design, the MAC looks forward to exceeding passenger expectations through 2030 and beyond.

 

 

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