Capital Region Airport Authority

Lansing, Michigan

Proposal Under the Small Community Air Service 

Development Program

Docket DOT-OST-2010-0124

Dun & Bradstreet DUNS Number 052703345

Two Digit Congressional District Codes: 07 and 08
 

 

Capital Region International Airport, Lansing, Michigan

Small Community Air Service Development Program Proposal – 2010 

2

TABLE OF CONTENTS

INTRODUCTORY LETTER .................................................................................. 4

EXECUTIVE SUMMARY...................................................................................... 5

AIR SERVICE OVERVIEW................................................................................... 6

Catchment Area ..................................................................................................................................................... 6

Alternate Airports ................................................................................................................................................... 6

Current Nonstop Routes and Frequencies ............................................................................................................ 8

Air Service Development Efforts ............................................................................................................................ 9

AIR SERVCE DEVELOPMENT NEEDS AND DEFICIENCIES .......................... 10

Declining Capacity ..............................................................................................................................................10

Declining Traffic ...................................................................................................................................................13

Leakage................................................................................................................................................................15

Rising Fares .........................................................................................................................................................16

Lansing Fares Versus Fares at Other Michigan Airports.....................................................................................19

STRATEGIC PLAN ............................................................................................ 20

Goals ....................................................................................................................................................................20

Target Airline Support ..........................................................................................................................................20

Local Lansing – Washington Traffic and Revenue ..............................................................................................21

Connecting Traffic and Revenue Via United's Washington Dulles Hub ..............................................................27

Proposed Schedule..............................................................................................................................................29

Alternate Strategies..............................................................................................................................................30

PROJECT IMPLEMENTATION, MONITORING AND FUNDING ....................... 31

Public / Private Partnerships ................................................................................................................................31

Lansing Regional Chamber of Commerce...........................................................................................................31

Regional Business Travel Trust ...........................................................................................................................31

Project Funding ....................................................................................................................................................32

Implementation Timeline......................................................................................................................................33

Start-Up Period and Sustainability of the Market.................................................................................................33

PROJECT MONITORING AND FINANCIAL CONTROL.................................... 34

Success Metrics ...................................................................................................................................................34

Legal Sponsor......................................................................................................................................................34

Financial Controls ................................................................................................................................................34
 

 

Capital Region International Airport, Lansing, Michigan

Small Community Air Service Development Program Proposal – 2010 

3

APPENDIX A: REQUIRED SUMMARY INFORMATION................................... 36

A. Applicant Information....................................................................................................................................36

B. Public/Private Partnerships ..........................................................................................................................36

C. Project Proposal ...........................................................................................................................................36

D. Existing Landing Aids at Local Airport ..........................................................................................................37

E. Project Cost ..................................................................................................................................................37

F. Enplanements...............................................................................................................................................37

G. Is this application subject to review by state under Executive Order 12372 Process? ................................37

H. Is this applicant delinquent on any federal debt? .........................................................................................38

APPENDIX B: COMMUNITY BACKGROUND.................................................. 39

Capital Region International Airport .....................................................................................................................39

Lansing and the Surrounding Region ..................................................................................................................40

Select Company Profiles......................................................................................................................................45

Higher Education..................................................................................................................................................47

Points of Interest ..................................................................................................................................................48

APPENDIX C: LETTERS OF SUPPORT .......................................................... 50

APPENDIX D: 2009 SMALL COMMUNITY AIR SERVICE DEVELOPMENT 

GRANT COMMUNITY LETTERS OF SUPPORT............................................... 56
 

 

Capital Region International Airport, Lansing, Michigan

Small Community Air Service Development Program Proposal – 2010 

4

INTRODUCTORY LETTER
 

 

Capital Region International Airport, Lansing, Michigan

Small Community Air Service Development Program Proposal – 2010 

5

EXECUTIVE SUMMARY

Capital Region International Airport is proposing a Small Community Air Service Development Grant in the 

amount of $1,000,000 to supplement community and airport funding totaling $650,000 to provide a minimum 

revenue guarantee for service between Lansing and Washington Dulles on 50-seat regional jets operated by a 

regional airline affiliate of United Airlines. 

Capital Region International Airport is the primary airport in a catchment area that includes Lansing and a large 

geographic region of Central Michigan. Lansing is the state capital of Michigan and home to Michigan State 

University. The Lansing metropolitan statistical area (MSA) is the third largest MSA in Michigan with a population 

of 453,600 residents. Its role as the state capital, home to Michigan State and the final assembly plants of 

General Motor's most popular vehicles produce a strong economy. Although Lansing is the third largest MSA in 

Michigan, Lansing had the second lowest unemployment rate of the 14 metropolitan areas tracked by the Bureau 

of Labor Statistics.

Unfortunately, Lansing's air service has not faired as well as the local economy. Based on the year-end first 

quarter 2010 DOT data, Lansing has lost two-thirds of the capacity airlines operated in 2005 when capacity 

peaked. The lost capacity represents 943 seats per day each way, and five airlines serving Lansing have 

discontinued service in nine markets. The merger of Northwest and Delta eliminated a competitor from the 

Lansing market, and the merger left Lansing with only two competitors, Delta and United. In addition to 

eliminating a competitor, the Delta-Northwest merger had a negative impact on the number of hubs served from 

Lansing. Since the merger, Delta has discontinued service to both the Cincinnati and Atlanta hubs. While Delta 

continues to serve the Detroit and Minneapolis/St. Paul hubs, capacity is down on each route as service has been 

downgraded to service on 50-seat regional jets. 

As Lansing lost capacity and competitors, fares have increased substantially. The average domestic one-way 

fare in the year-end first quarter 2005, when capacity reached its peak, was $133. In the most recent year, the 

average domestic one-way fare had increased to $196, and fares continue to rise. First quarter 2010 data 

indicates Lansing's average domestic one-way fare stood at $211, or $422 on a roundtrip basis. The average first 

quarter 2010 one-way fare is higher than the average fare in either second or third quarter 2008 when the cost of 

oil peaked, when most U.S. airports experienced peaks in domestic fares. 

Because capacity is at its lowest point in at least the last 10 years and because fares are at their highest point 

ever, Capital Region International Airport retains just 37% of the traffic generated in its catchment area. Traffic 

has declined from 657,780 domestic and international origin and destination passengers in the year-end first 

quarter 2005 to just 241,650 domestic and international origin and destination passengers in the year-end first 

quarter 2010 – a decline of 416,130 origin and destination passengers. To put the decline in perspective, 2005 

traffic generated 901 passengers per day each way (PDEW) – equivalent to the capacity 18 50-seat regional jets. 
 

 

Capital Region International Airport, Lansing, Michigan

Small Community Air Service Development Program Proposal – 2010 

6

In the most recent year, Lansing's traffic had declined to just 331 PDEW – equivalent to the capacity of just under 

seven 50-seat regional jets.

AIR SERVICE OVERVIEW

Catchment Area

Capital Region International Airport is the primary airport serving an area of mid-Michigan with a population of 

1,075,000 residents. The Airport's catchment area has grown 6.1%, or by 61,500 new residents, over the last five 

years. This represents the largest growth of any area in Michigan. The catchment area includes communities 

within a 60-minute drive of the airport, making Lansing the most convenient option of airports in the region. 

Exhibit 1: Primary Catchment Area of Capital Region International Airport

Alternate Airports
 

 

Capital Region International Airport, Lansing, Michigan

Small Community Air Service Development Program Proposal – 2010 

7

Capital Region International Airport is the primary airport for travelers in the Lansing area. There are other 

airports on the lower peninsula of Michigan Lansing area travelers may choose for their travel if they prefer 

nonstop service to their final destination or when low fares are not available at Lansing.

Exhibit 2: Location of Lansing Capital Region International Airport Relative to Other Airports in the Region, Distances and 

Drive Times from Lansing to Other Airports
 

 

Capital Region International Airport, Lansing, Michigan

Small Community Air Service Development Program Proposal – 2010 

8

Current Nonstop Routes and Frequencies

Lansing is currently served by Delta/Delta Connection with regional jet service to Detroit and Minneapolis/St. Paul 

and by United/United Express with regional jet service to Chicago O'Hare. In November 2010, Delta will operate 

7 3/7 flights per day to Detroit and one to Minneapolis/St Paul. United will operate four roundtrips to Chicago. All 

service will be operated with 50-seat regional jets.

Exhibit 3: Current Routes Operated from Capital Region International Airport

Exhibit 4: Departures per Day, Seats per Departure and Seats per Day by Market and Carrier at Lansing – November 2010

Carrier Destination

Departures per 

Day

Seats per 

Departure

Seats 

per Day

Delta Detroit 7 3/7 50 373

Minneapolis 1 50 50

Total 8 3/7 50 423

United Chicago 4 50 200

Total 4 50 200

Total 12 3/7 50 623
 

 

Capital Region International Airport, Lansing, Michigan

Small Community Air Service Development Program Proposal – 2010 

9

Air Service Development Efforts

Capital Region International Airport aggressively pursues new and enhanced air service. The Airport Director and 

the Director of Market Development meet with both incumbent and prospective airlines on a regular basis to 

discuss Lansing's air service needs. Over the last year, the Airport has met with no less than 15 airlines at their 

headquarters or at air service development conferences:

1. AeroMexico

2. AirTran

3. American

4. American Eagle

5. Continental

6. Delta

7. ExpressJet

8. Frontier

9. JetBlue

10. Mexicana

11. Southwest

12. Sun Country

13. United

14. US Airways

15. Virgin America

Capital Region International Airport markets the airport in both Lansing and other areas in Mid-Michigan. The 

Airport's marketing and promotional efforts include advertising campaigns using print, television, radio, and 

various travel-related internet sites. In addition to advertising, Capital Region International Airport also promotes

its service with sponsorships of sporting events, festivals and other events in Mid-Michigan.
 

 

Capital Region International Airport, Lansing, Michigan

Small Community Air Service Development Program Proposal – 2010 

10

AIR SERVCE DEVELOPMENT NEEDS AND DEFICIENCIES

Declining Capacity

Lansing has lost nearly two-thirds of the capacity airlines serving the market operated in 2005. In the year-end 

first quarter 2010 airlines operated 567 seats per day each way, decline of 943 seats per day or 62.4%. Going 

back over the last ten years, Lansing's capacity declined slightly between year-end first quarter 2001 and 2002 

and increased 455 seats per day, or 43.1% by 2005. 

Exhibit 5: Seats per Day Each Way (All Carriers) at Capital Region International Airport – Year-End First Quarter 2001-2010

(DOT T-100 data) 

-This Section Continued on Next Page

1,110

1,055

1,137

1,316

1,510

1,305

1,089

934

777

567

0

200

400

600

800

1,000

1,200

1,400

1,600

2001 2002 2003 2004 2005 2006 2007 2008 2009 2010

Seats per Day Each Way

Seats per Day Each Way (All Carriers)
 

 

Capital Region International Airport, Lansing, Michigan

Small Community Air Service Development Program Proposal – 2010 

11

As illustrated in Exhibit 6, Lansing's capacity grew from 2002 through 2005 as Delta/Northwest, United, Allegiant, 

Independence Air and other carriers (including Continental, Midwest and US Airways) added capacity in the 

market. Beginning with the simultaneous bankruptcies of Delta and Northwest in September 2005, and followed 

by the bankruptcy of Independence Air later in the year, Lansing's capacity began to fall. Continental, US Airways 

and Midwest exited the market. Delta and Northwest reduced capacity further even further after they merged by 

discontinuing service to Cincinnati, Atlanta and Minneapolis/St. Paul (the Minneapolis/St. Paul service has since 

been reinstated) and by operating smaller aircraft in remaining markets. Allegiant exited the Lansing market in 

early 2009, leaving Lansing with service only from Delta and United. 

Exhibit 6: Seats per Day Each Way by Carrier (All Carriers) at Capital Region International Airport – Year-End First Quarter 

2001-2010 (DOT T-100 data) 

This Section Continued on Next Page

0

200

400

600

800

1,000

1,200

1,400

1,600

2001 2002 2003 2004 2005 2006 2007 2008 2009 2010

962 901

986 957

1,080

943

727

594 532

392

154

93 183

183

203

219

195

175

174

129

69

89

144

143

146

70

148

58

107

28

15

Delta/Northwest United Independence Allegiant Others
 

 

Capital Region International Airport, Lansing, Michigan

Small Community Air Service Development Program Proposal – 2010 

12

Since 2001, airlines serving Lansing have discontinued service to 14 destinations. Lansing is no longer served by 

Allegiant, American, ATA (American Trans Air), Continental, Independence Air, Midwest (which has been merged 

into Frontier) or US Airways. While Northwest was acquired by Delta, and the merged company still serves 

Lansing, the routes operated by the merged company are former Northwest routes. Cincinnati and Atlanta 

service was operated on the Delta code by Delta regional airline affiliates prior to the merger and the service in 

these markets was discontinued after Delta acquired Northwest.

Exhibit 7: Lansing Service Discontinued Since 2001 by Year, Carrier and Destination

*Continental discontinued Lansing-Cleveland service in both 2001 and 2004

Year Carrier Destination

1 2001 American Chicago O'Hare

2 2001 ATA Chicago Midway

3 2001 Continental Cleveland

4 2004 Continental Cleveland*

5 2004 US Airways Pittsburgh

6 2005 Independence Air Washington Dulles

7 2006 Midwest Milwaukee

8 2006 Northwest Washington Reagan

9 2006 Northwest Washington Dulles

10 2008 Allegiant Las Vegas

11 2008 Delta Atlanta

12 2008 Delta Cincinnati

13 2009 Allegiant Sanford/Orlando

14 2009 Allegiant St. Petersburg/Tampa
 

 

Capital Region International Airport, Lansing, Michigan

Small Community Air Service Development Program Proposal – 2010 

13

Declining Traffic

As Lansing has lost capacity, traffic has also declined. As shown in Exhibit 8, Lansing's traffic has declined

63.3% since the peak in year-end first quarter 2005. Domestic O&D traffic is down by 412,980 O&D passengers 

or 65.7% to 215,719 passengers. International traffic is down much less – 10.8% – to 25,940 O&D passengers in 

the most recent year. 

Exhibit 8: Annual Domestic and International Origin and Destination (O&D) Passengers at Capital Region International Airport 

– Year-End First Quarter 2001-2010 (DB1B data)

This Section Continued on Next Page

0

100,000

200,000

300,000

400,000

500,000

600,000

700,000

2001 2002 2003 2004 2005 2006 2007 2008 2009 2010

589,340

482,120 474,800

518,030

628,690

575,070

506,720

435,210

342,260

215,710

29,010

24,830 26,120

26,350

29,090

32,290

31,540

29,610

25,420

25,940

Annual Domestic O&D Annual International O&D
 

 

Capital Region International Airport, Lansing, Michigan

Small Community Air Service Development Program Proposal – 2010 

14

Translated to passengers per day each way (PDEW) in Exhibit 9, Lansing generated 859 domestic PDEW in the 

year-end first quarter 2005; in the year-end first quarter 2010, Lansing generated just 295 domestic PDEW – a 

decline of 564 PDEW.

Exhibit 9: Annual Domestic and International Passengers per Day Each Way (PDEW) at Capital Region International Airport –

Year-End First Quarter 2001-2010 (DB1B data)

0

100

200

300

400

500

600

700

800

900

1,000

2001 2002 2003 2004 2005 2006 2007 2008 2009 2010

807

659 650

710

859

788

694

595

469

295

40

34 36

36

40

44

43

40

35

36

Domestic PDEW (All Carriers) International PDEW (All Carriers)
 

 

Capital Region International Airport, Lansing, Michigan

Small Community Air Service Development Program Proposal – 2010 

15

Leakage

Although capacity and traffic have declined at Capital Region International Airport, demand for air service has not 

declined. Based on a leakage study completed in January 2010, Lansing's catchment area generates 1,196 

PDEW, but Capital Region International Airport retains only 37% of the traffic in its catchment area – 63% of the 

traffic leaks to other airports. 45.0% of catchment area traffic leaks to Detroit, 8.0% leaks to Grand Rapids and 

7.6% of the traffic leaks to Flint. 

While the average domestic fare at Detroit was $149 in the year-end first quarter 2010 and Lansing's average 

domestic fare was $196 in the same period, traffic in Lansing's catchment area leaking to Detroit paid just $12 

less than the average Lansing fare. While some traffic obviously leaked to Detroit for a lower fare, the small 

disparity between fares of passengers in the catchment area paid when flying from Lansing versus Detroit is likely 

a strong indication a large portion of the traffic leaked to Detroit because the amount of capacity operated from 

Lansing to hub airports was insufficient.

Exhibit 10: Airport Origin for Lansing Catchment Area Traffic (January 2010 Leakage Study)

37.0%

45.0%

7.6%

8.0%
 

 

Capital Region International Airport, Lansing, Michigan

Small Community Air Service Development Program Proposal – 2010 

16

Rising Fares

As Lansing has lost capacity and traffic declined, fares have increased (Exhibit 11). Since 2005, when capacity 

and traffic reached its peak, the average domestic fare has increased 47% or $63 to $196. Even as most markets 

experienced a decline in fares between year-end first quarter 2009 and year-end first quarter 2010, Lansing's 

average domestic fare increased from $183 to $196.

Exhibit 11: Seats per Day Each Way and Average Domestic Fare at Capital Region International Airport – Year-End First 

Quarter 2001-2010 (DOT T-100 and DB1B data)

This Section Continued on Next Page

1,110

1,055

1,138

1,316

1,510

1,305

1,090

936

778

569

$162 $158

$144 $144

$133

$152

$163 $168

$183

$196

$100

$150

$200

$250

$300

0

200

400

600

800

1,000

1,200

1,400

1,600

2001 2002 2003 2004 2005 2006 2007 2008 2009 2010

Average One-Way Fare

Seats per Day Each Way

Seats per Day Each Way (All Carriers) Domestic Average Fare (All Carriers)
 

 

Capital Region International Airport, Lansing, Michigan

Small Community Air Service Development Program Proposal – 2010 

17

Among the airports surrounding Lansing – Detroit, Grand Rapids, Kalamazoo, Saginaw and Flint – only 

Kalamazoo's average domestic fare, at $216, was higher than Lansing's fare of $196 in year-end first quarter 

2010 (Exhibit 12). 

Exhibit 12: Average Domestic Fare at Lansing and Airports Surrounding Lansing – Year-End First Quarter 2010 (DB1B data)

This Section Continued on Next Page

$0

$50

$100

$150

$200

$250

FNT DTW GRR MBS LAN AZO

$127

$149

$171 $187 $196

$216
 

 

Capital Region International Airport, Lansing, Michigan

Small Community Air Service Development Program Proposal – 2010 

18

Quarterly data indicates Lansing's average domestic fare rose from $186 to $211 in first quarter 2010 versus 

2009 as capacity fell to just 541 seats per day each way. Versus first quarter 2008, the average domestic fare is 

up from $172, an increase of 23% as capacity declined by 291 seats per day or 52.3%.

Exhibit 13: Seats per Day Each Way and Average Domestic Fare at Capital Region International Airport – Quarterly Data –

First Quarter 2008 through First Quarter 2010 (DOT T-100 and DB1B data)

860

929

827

739

609 629

577

520 541

$172

$180

$186

$180

$186 $184

$189

$202

$211

$100

$150

$200

$250

$300

0

100

200

300

400

500

600

700

800

900

1,000

2008-Q1 2008-Q2 2008-Q3 2008-Q4 2009-Q1 2009-Q2 2009-Q3 2009-Q4 2010-Q1

Average One-Way Fare

Seats per Day Each Way

Seats per Day Each Way (All Carriers) Domestic Average Fare (All Carriers)
 

 

Capital Region International Airport, Lansing, Michigan

Small Community Air Service Development Program Proposal – 2010 

19

Lansing Fares Versus Fares at Other Michigan Airports

Among Lansing's 30 largest domestic markets in the year-end first quarter 2010, Lansing had a lower fare than 

Detroit or Grand Rapids (the two largest alternate airports to Lansing) in only one market – Minneapolis/St. Paul. 

The difference between Lansing's average one-way fare ranged as high as $125 each way in the Chicago market 

and $129 each way in the San Antonio market. The average difference between the lowest fare at Detroit or 

Grand Rapids versus Lansing's average fare was $44 each way in the year-end first quarter 2010.

Exhibit 14: PDEW and Average One-Way Fare in Lansing's 30 Largest Markets Versus Average Fare in Detroit and Grand 

Rapids – Year-End First Quarter 2010 (DB1B data)

LAN vs.

Rank Market (Metro Area) LAN PDEW LAN DTW GRR Lowest Fare

1 DCA/IAD/BWI 37.8 $136 $117 $159 $19

2 LGA/JFK/EWR 19.8 $164 $140 $160 $24

3 LAX/SNA/ONT/BUR/LGB 12.4 $221 $181 $185 $40

4 MSP 9.5 $173 $198 $210 $0

5 ORD/MDW 8.6 $222 $97 $184 $125

6 ATL 8.4 $244 $126 $193 $118

7 MCO/SFB 8.0 $152 $93 $110 $59

8 DFW/DAL 7.4 $187 $165 $182 $23

9 LAS 7.4 $205 $140 $135 $70

10 SFO/OAK/SJC 7.0 $254 $189 $173 $82

11 BOS 7.0 $181 $184 $163 $18

12 DEN 6.7 $183 $139 $188 $44

13 MIA/FLL/PBI 6.5 $170 $116 $138 $54

14 SEA 5.6 $222 $192 $187 $35

15 STL 5.5 $170 $102 $164 $68

16 PHX/AZA 5.4 $206 $151 $151 $56

17 IAH/HOU 5.0 $199 $174 $196 $24

18 PHL 4.7 $220 $172 $150 $70

19 RDU 4.6 $167 $146 $157 $21

20 TPA/PIE 4.1 $169 $109 $117 $60

21 BNA 4.1 $166 $133 $179 $33

22 MCI 4.0 $186 $170 $166 $20

23 RSW 4.0 $155 $117 $149 $38

24 SAN 3.9 $297 $174 $216 $123

25 BDL 3.1 $187 $177 $188 $9

26 PDX 3.1 $202 $189 $213 $13

27 SMF 2.7 $226 $169 $218 $57

28 CLT 2.5 $207 $164 $202 $43

29 SAT 2.3 $286 $157 $186 $129

30 OMA 2.3 $189 $170 $168 $22

213.3 $186 $139 $162 $44

Average One-Way Fare
 

 

Capital Region International Airport, Lansing, Michigan

Small Community Air Service Development Program Proposal – 2010 

20

STRATEGIC PLAN

Goals

Lansing has three goals with its Small Community Air Service Development Grant proposal for service to 

Washington Dulles on United:

 Lower fares in the local market and connect markets served via United's Dulles hub

 Reverse the decline in Lansing's origin and destination traffic

 Recapture catchment area traffic leaked to other airports

Target Airline Support

United Airlines has expressed interest in operating the proposed service from Lansing to Washington Dulles. 

While United cannot commit to operating the service if Capital Region International Airport receives a Small 

Community Air Service Development grant, United has indicated a minimum revenue guarantee will reduce its 

financial risk and move Lansing-Washington Dulles above other regional jet new route opportunities without a 

minimum revenue guarantee. United supports Lansing's proposal for a small community air service development 

grant and has indicated a letter of support will be written.

SkyWest Airlines, a regional airline operating as a United Express code share partner has also expressed interest 

in operating the proposed service and has indicated it plans to support this proposal with a letter of support.
 

 

Capital Region International Airport, Lansing, Michigan

Small Community Air Service Development Program Proposal – 2010 

21

Local Lansing – Washington Traffic and Revenue

The Lansing market size of the combined three airports in the Washington/Baltimore area was 37.8 PDEW in the 

year-end first quarter 2010, making the Washington/Baltimore market Lansing's largest O&D market. The 

Washington market generated almost twice as much traffic as Lansing's second largest market, New 

York/Newark (19.8 PDEW). As the state capital of Michigan, there is significant traffic between Lansing and the 

Washington/Baltimore airports and a significant need for nonstop service in the market. Among the ten largest 

states, only Michigan and Illinois do not have service connecting their state capital with at least one airport serving 

the nation's capital. In addition to government-related travel between Lansing and Washington, there is also a 

significant amount of Michigan State University business travel between Lansing and Washington.

Analysis of historical data indicates Lansing-Washington has been a large market for at least the last ten years. 

In fact, Independence Air and Northwest briefly operated nonstop service to Dulles and to Reagan between 2004 

and early 2006 on 50-seat regional jets. When Independence Air and Northwest operated the nonstop service, 

the market size increased to more than 120 PDEW with the majority of traffic flowing to Dulles. The average fare 

among the three Washington airports fell from $146 to $115 when traffic peaked, and increased once 

Independence Air and Northwest discontinued Lansing-Washington service.

This Section Continued on Next Page
 

 

Capital Region International Airport, Lansing, Michigan

Small Community Air Service Development Program Proposal – 2010 

22

More recently, Lansing generated 37.8 PDEW to the Washington/Baltimore area in the year-end first quarter 2010 

at an average fare of $136. Quarterly data shows Lansing generated 31.5 PDEW in the Washington/Baltimore 

market at an average fare of $163 in first quarter 2010. In fact, fares in the market have increased in each of the 

last three quarters.

Exhibit 15: Lansing – Combined Washington Area Airports (DCA, BWI, IAD) PDEW and Average Fare – Year-End First 

Quarter (DB1B data)

This Section Continued on Next Page

50.6

42.8 44.7 46.2

121.4

56.5

41.8

35.7

50.7

37.8

$157 $160

$134

$146

$115

$127 $130

$135

$116

$136

$0

$25

$50

$75

$100

$125

$150

$175

$200

0

20

40

60

80

100

120

140

2001 2002 2003 2004 2005 2006 2007 2008 2009 2010

Average One-Way Fare

Passengers per Day Each Way (PDEW)

LAN-All WAS PDEW LAN-All WAS Fare
 

 

Capital Region International Airport, Lansing, Michigan

Small Community Air Service Development Program Proposal – 2010 

23

Historically, and in the most recent year, the majority of traffic to the Washington airports has flowed to 

Washington Reagan, but Dulles was the primary airport when the nonstop service was offered, and the Airport 

believes Dulles would become the preferred airport for Lansing area Washington/Baltimore travels if the 

convenience of a nonstop were available to Dulles just as it was when Independence Air and Northwest operated 

Lansing-Dulles service.

Exhibit 16: Lansing – Washington Area Airports (DCA, BWI, IAD) PDEW by Airport – Year-End First Quarter (DB1B data)

This Section Continued on Next Page

3 3

2 5 2 8 2 9

2 1

3 5

2 6

2 1

3 6

2 4

1 2 1 0 1 0 1 0 1 0 7

1 0 1 0 7 7

7

8 6 7

9 0

1 5

6 5

8 7

5 1

4 3 4 5 4 6

121

5 7

4 2

3 6

5 1

3 8

0

20

40

60

80

100

120

140

2001 2002 2003 2004 2005 2006 2007 2008 2009 2010

Passengers per Day Each Way (PDEW) 

LAN-DCA PDEW LAN-BWI PDEW LAN-IAD PDEW LAN-All WAS PDEW
 

 

Capital Region International Airport, Lansing, Michigan

Small Community Air Service Development Program Proposal – 2010 

24

With the exception of a spike in the average Baltimore fare in 2006, there is not significant variation in average 

fares from Lansing to each of the airports in the Washington area. Dulles fares trend to be slightly lower than 

Reagan or Baltimore fares since 2006. The fare at all three airports generally trends in the same direction. The 

year-end first quarter data indicates fares to all three airports have been reasonable over the past six years.

Exhibit 17: Lansing – Washington Area Airports (DCA, BWI, IAD) Average One-Way Fare by Airport – Year-End First Quarter 

(DB1B data)

This Section Continued on Next Page

$157 $160

$134

$146

$115

$127

$130

$135

$116

$136

$100

$120

$140

$160

$180

$200

2001 2002 2003 2004 2005 2006 2007 2008 2009 2010

Average One-Way Fare

LAN-DCA Fare LAN-BWI Fare LAN-IAD Fare LAN-All WAS Fare
 

 

Capital Region International Airport, Lansing, Michigan

Small Community Air Service Development Program Proposal – 2010 

25

While Lansing-Washington fares have been at a reasonable level over the past several years, the average fare of 

$163 in first quarter 2010 was a level not seen since 2002, and traffic declined to a ten-year low. Capital Regional 

International Airport believes nonstop service would stimulate the market size, and the nonstop service would put 

competitive pressure on fares. In the most recent year, Delta captured 84.2% of the share in the market, and 

United captured the remaining 15.8% of the share. Delta's average fare was $137 and United's average fare was 

$130. 

Exhibit 18: Lansing – Combined Washington Area Airports (DCA, BWI, IAD) PDEW and Average Fare -- Quarterly Data –

First Quarter 2008 through First Quarter 2010 (DB1B data)

This Section Continued on Next Page

38.6

53.0

60.0

52.1

37.7

46.9

36.6 36.4

31.5

$126

$117

$109

$117

$126

$116

$125

$151

$163

$0

$25

$50

$75

$100

$125

$150

$175

$200

0

20

40

60

80

100

120

140

2008-Q1 2008-Q2 2008-Q3 2008-Q4 2009-Q1 2009-Q2 2009-Q3 2009-Q4 2010-Q1

Average One-Way Fare

Passengers per Day Each Way (PDEW)

LAN-All WAS PDEW LAN-All WAS Fare
 

 

Capital Region International Airport, Lansing, Michigan

Small Community Air Service Development Program Proposal – 2010 

26

Relative to other markets in the U.S. under 500 miles from Washington (500 miles is well within the economical 

range of a 50-seat regional jet), Lansing is the second largest market without nonstop service to one of the three 

Washington/Baltimore airports. With 42.7 PDEW, the Augusta, Georgia – Washington market is the only market 

larger than Lansing-Washington without nonstop service, and this should make Lansing-Washington Dulles an 

attractive regional jet opportunity for United.

Exhibit 19: Washington Area Airports (DCA, IAD, BWI) PDEW, Yield, Revenue per Day Each Way, Distance and Nonstop 

Service Indication in Markets Under 500 Miles – Year-End First Quarter 2010 Data (DB1B data)

Rank Market PDEW Fare Yield Revenue per Day 

Each Way Distance Nonstop WAS Service

25 ORF/PHF 105.0 $116 $0.862 $12,213 135 Yes

26 CAE 99.3 $240 $0.599 $23,841 401 Yes

27 GSO 87.0 $140 $0.584 $12,153 239 Yes

28 GSP 70.3 $189 $0.494 $13,297 383 Yes

29 HPN 67.8 $153 $0.621 $10,412 247 Yes

30 LEX 52.1 $185 $0.473 $9,657 392 Yes

31 MYR 51.1 $148 $0.397 $7,554 372 Yes

32 PHL 45.1 $80 $0.594 $3,588 134 Yes

33 AGS 42.7 $176 $0.382 $7,493 459 No

34 LAN 37.8 $136 $0.298 $5,157 458 No

35 AVL 34.6 $168 $0.455 $5,827 370 Yes

36 ILM 29.6 $158 $0.490 $4,682 323 No

37 CRW 28.6 $218 $0.962 $6,249 227 Yes

38 FWA 27.3 $164 $0.378 $4,467 434 No

39 RIC 19.1 $63 $0.639 $1,206 99 Yes

40 HHH 17.8 $172 $0.345 $3,049 498 No

41 AZO 17.5 $178 $0.370 $3,121 482 No

42 MBS 16.6 $151 $0.322 $2,510 468 No

43 FNT 16.4 $116 $0.269 $1,896 430 No

44 CAK 15.6 $137 $0.542 $2,136 252 Yes

45 ACK 13.4 $183 $0.432 $2,438 423 No

46 TRI 13.1 $207 $0.648 $2,723 320 No

47 FAY 12.3 $293 $1.033 $3,613 284 No

48 MDT 11.1 $70 $0.744 $774 94 Yes

49 ROA 10.7 $171 $0.964 $1,829 177 Yes

50 ITH 10.3 $180 $0.718 $1,843 250 No
 

 

Capital Region International Airport, Lansing, Michigan

Small Community Air Service Development Program Proposal – 2010 

27

Connecting Traffic and Revenue Via United's Washington Dulles Hub

Not only would Lansing-Washington Dulles service connect Lansing with its largest O&D market and connect 

Washington with its second largest market without nonstop service under 500 miles, but service on United to 

Dulles would provide access to United's Dulles hub. Lansing travelers could connect to markets along the East 

Coast and the international markets United and its Star Alliance partners serve from Dulles. In fact, Lansing 

travelers could connect with at least 55 markets United serves from Dulles. The 30 largest Lansing markets 

United could serve with Dulles service generated 146 PDEW at an average fare of $196 in the year-end first 

quarter 2010.

Exhibit 20: Non-Circuitous Markets United Could Serve with Lansing – Washington Dulles Service
 

 

Capital Region International Airport, Lansing, Michigan

Small Community Air Service Development Program Proposal – 2010 

28

The 30 largest markets United could serve with Lansing – Washington Dulles service generated 137 passengers 

per day each way at an average one-way fare of $179 in the year-end first quarter 2010. All markets that could 

flow via Washington Dulles on United generated 142 PDEW at an average one-way fare of $186. The size of the 

local market, plus the cumulative size of connecting markets via Washington Dulles at the high average fares

should make Lansing – Washington Dulles an attractive opportunity for regional jet service on United. 

Exhibit 21: Annual O&D Passengers, Passengers per Day Each Way (PDEW) and Average One-Way Fares in the 30 Largest 

Markets United Could Serve with Lansing – Washington Dulles Service – Year-End First Quarter 2010 (DB1B data)

Rank Market (Metro Area) PDEW

Average 

One-Way Fare

1 DCA/IAD/BWI 37.8 $136

2 LGA/JFK/EWR 19.8 $164

3 ATL 8.4 $244

4 MCO/SFB 8.0 $152

5 BOS 7.0 $181

6 MIA/FLL/PBI 6.5 $170

7 CUN 5.7 $194

8 PHL 4.7 $220

9 RDU 4.6 $167

10 TPA/PIE 4.1 $169

11 RSW 4.0 $155

12 BDL 3.1 $187

13 CLT 2.5 $207

14 JAX 2.0 $180

15 RIC 2.0 $167

16 ALB 1.7 $196

17 ORF/PHF 1.7 $183

18 MSY 1.5 $244

19 GSO 1.3 $154

20 PVD 1.3 $221

21 LHR/LGW 1.3 $497

22 CAE 1.2 $527

23 GSP 1.0 $165

24 MDT 1.0 $292

25 MHT 1.0 $214

26 SAV 0.9 $219

27 PWM 0.8 $174

28 AMS 0.6 $469

29 HPN 0.6 $192

30 FRA 0.6 $415

30 Largest Market Total 136.7 $179
 

 

Capital Region International Airport, Lansing, Michigan

Small Community Air Service Development Program Proposal – 2010 

29

Proposed Schedule

The Airport believes a schedule with two roundtrips timed to connect with both United domestic and international 

flights at Dulles will maximize United's revenue and minimize payments under the proposed minimum revenue 

guarantee.

Exhibit 22: Proposed Lansing-Washington Dulles Schedules

Lansing to Washington Dulles (457 Miles)

Depart Arrive Block Aircraft

6:00AM 7:40AM 1:40 ERJ

2:20PM 4:00PM 1:40 ERJ

Washington Dulles to Lansing (457 Miles)

Depart Arrive Block Aircraft

12:10PM 1:55PM 1:45 ERJ

6:45PM 8:30PM 1:45 ERJ
 

 

Capital Region International Airport, Lansing, Michigan

Small Community Air Service Development Program Proposal – 2010 

30

Alternate Strategies

In the event United is not able to launch nonstop regional jet service on a capacity purchase basis between 

Lansing and Washington Dulles, Capital Region International Airport would approach one of the companies

operating as a United Express affiliate carrier to operate Lansing-Washington Dulles service. Airlines including 

SkyWest and ExpressJet operate some of their service under the United Express brand on a pro-rate agreement 

with United. Unlike capacity purchase service where United pays regional operators a fee per departure and an 

hourly block hour rate, pro-rate service is operated at the financial risk of the regional airline without the fee per 

departure and hourly block hour payments from United. The Airport believes service on the United code is most 

practical for Washington service because United already serves Lansing with Chicago service and could leverage 

its presence at the Airport without the expense of opening a new station. Service to Dulles would make service 

on the United code less dependent on local Lansing-Washington traffic because Lansing travelers could connect 

to destinations beyond the Dulles hub. Furthermore, United's presence in Lansing means United has an 

established base of frequent flier program members in United's catchment area, most of whom would likely chose 

United when traveling to the Washington area.

Capital Region International Airport would discuss service Lansing-Washington Reagan service with US Airways 

and US Airways Express regional affiliate carriers and Delta Air Lines and Delta Connection carriers in the event 

United or a United Express regional affiliate carrier could not begin service in the Lansing-Washington Dulles 

market. While United service is favored by the community because it links Lansing with its largest O&D 

destination and maximizes connecting opportunities beyond Washington, US Airways or Delta service to

Washington Reagan would connect Lansing with the preferred airport in the Washington/Baltimore area, but it 

would provide less connectivity than the connectivity offered by United's Dulles hub. 
 

 

Capital Region International Airport, Lansing, Michigan

Small Community Air Service Development Program Proposal – 2010 

31

PROJECT IMPLEMENTATION, MONITORING AND FUNDING

Public / Private Partnerships

Lansing Regional Chamber of Commerce

The Lansing Regional Chamber of Commerce is tthe pre-eminent business advocacy organization in the Greater 

Lansing region and collaborates for economic growth, creates new business opportunities for its members and 

upholds pro-business ideals through the advancement of sound public policy.

Regional Business Travel Trust

The Regional Business Travel Trust (RBTT) is an organization of over 200 local companies, organizations and 

individuals created in 2004. The mission of the Regional Business Travel Trust is to support existing service and 

improve air service at Capital Region International Airport. The goals of the organization are to:

 Consolidate regional business & industry buying power. 

 Negotiate air service improvements. 

 Air fare improvements /stability. 

 Flight schedule improvements. 

 Customer quality control involvement. 

 Encourage expanded community support of their airport services
 

 

Capital Region International Airport, Lansing, Michigan

Small Community Air Service Development Program Proposal – 2010 

32

Project Funding

In addition to the Small Community Air Service Development Grant of $1,000,000 requested from the

Department, organizations in the community are willing to provide cash of $150,000 and in-kind funding valued at 

$200,000 for local media company advertising placement. The Airport will provide cash of $100,000 for marketing 

and estimates the value of its in-kind contributions from waived fees valued at $200,000 over the two year life of 

the project. The total value of cash and in-kind contributions from the community and the airport is valued at 

$650,000, or 39.4% of the total project cost.

The total cost of the proposed project is $1,650,000.

Exhibit 22: Summary of Sources and Types of Project Funding

.

Grant Cash In-Kind Total

Department of Transportation $1,000,000 $1,000,000

Community $150,000 $200,000 $350,000

Capital Region International Airport $100,000 $200,000 $300,000

Total $1,000,000 $250,000 $400,000 $1,650,000
 

 

Capital Region International Airport, Lansing, Michigan

Small Community Air Service Development Program Proposal – 2010 

33

Implementation Timeline

Our proposed implementation timeline for the project assumes the Department will award Small Community Grant 

Funding in December 2010. Once the award is announced, Capital Region International Airport will begin 

discussions with United to begin service. Based on airline planning lead times and the need for advance 

bookings, we assume United would not be able to begin service until at least June 2011. The first two milestones 

on the Airport's timeline are to execute the grant agreement with the Department and the minimum revenue 

guarantee agreement with United. Once service is announced and schedules are published, the Airport would 

begin marketing the new route and working with United to monitor advance bookings. The Airport will continue its 

marketing program and continue to work with United to monitor the route once service begins. The Airport will

submit grant status reports on a quarterly basis to the Department throughout the proposed two year term of the 

minimum revenue guarantee.

Exhibit 23: Proposed Project Timeline (assumes grant announcements in December 2010 and service launch in June 2011)

Start-Up Period and Sustainability of the Market

The Airport will aggressively market the new service to business and leisure travelers in the catchment area. A

benefit of beginning service in June 2011 is to capture the peak of traffic seasonality in the U.S. domestic and 

international air travel market. Beginning service in the summer will provide a strong start for the service and 

provide two-and-a-half to three months to build business traffic in the market before leisure traffic demand falls in 

mid-August to early September. Business travel will become more important for the success of the route as 

leisure travel declines in the Fall. The Airport expects the route to be self-sustaining within the first two years of 

service and will include Washington as part of its on-going marketing and promotional campaigns of the airport.

Activity/Project Milestone Estimated Dates

SCASD Grant Award Announcement December 2010

Execute Grant Agreement with DOT January 2011

Negotiate Minimum Revenue Guarantee with Airline January 2011

Announce Service February 2011

Publish Schedule February 2011

Market New Route March-May 2011

Monitor Advance Bookings March-May 2011

Begin Service June 2011

Operate Service with MRG June 2011 - May 2013

Monitor Route Performance June 2011 - May 2013 and Beyond

Submit Grant Status Reports to DOT Quarterly 2Q 2011 - 2Q 2013
 

 

Capital Region International Airport, Lansing, Michigan

Small Community Air Service Development Program Proposal – 2010 

34

PROJECT MONITORING AND FINANCIAL CONTROL

Success Metrics

The success of the program will be based on achieving the objectives of the program. The Airport will 

continuously monitor the performance of the route. Even before service begins we will communicate with United 

on a weekly basis to monitor advance bookings and week-over-week of advance bookings. Marketing and 

promotional activities can be adjusted if advance bookings are weak or are not booking at a rate comparable to 

other United Dulles markets.

Project Goals Success Metric

 Lower fares in the local market and connect 

markets served via United's Dulles hub

 Lower quarterly year-over-year fares in the 

markets United serves via Washington Dulles 

(including fares in the local Washington market)

 Reverse the decline in Lansing's origin and 

destination traffic

 Increased quarterly year-over-year origin and 

destination traffic 

 Recapture catchment area traffic leaked to other 

airports

 Less leakage in the local market and the markets 

served via Washington Dulles 

Once service begins, the Airport will rely on traffic and revenue data provided directly by the airline and the 

amount of reimbursements requested by the airline as indications of project success. T-100 data and DB1B data 

will also be analyzed to compare year-over-year market size growth on a quarterly basis. In addition, the airport 

will analyze leakage once the service has operated for a full year to determine the trend in leakage to other 

airports. The Airport will report its success metrics in the quarterly grant reports to the Department. 

Legal Sponsor

Capital Region Airport Authority is the legal sponsor responsible for administering the program. Capital Region 

Airport Authority is a government entity.

Capital Region Airport Authority

4100 Capital City Boulevard

Lansing, MI 48906

Robert F. Selig, Airport Director

517-886-3711

Financial Controls

As the sponsor, Capital Region Airport Authority and its governing body, Lansing Airport Commission, will be the 

responsible parties for all fiscal matters and the Department's reporting requirements. The Commission is 

established as a public governing body. As a public entity, the Department can be assured that proper financial 
 

 

Capital Region International Airport, Lansing, Michigan

Small Community Air Service Development Program Proposal – 2010 

35

controls are in place to guarantee that the Department’s Grant will be used in accordance with any subsequent 

agreement. The Lansing Airport Commission understands that the Grant is a reimbursable grant, meaning the 

Airport is responsible for program expenditures and will submit invoices to the Department for reimbursement, 

based on a percentage of the total grant request.
 

 

Capital Region International Airport, Lansing, Michigan

Small Community Air Service Development Program Proposal – 2010 

36

APPENDIX A: REQUIRED SUMMARY INFORMATION

A. Applicant Information

 Not a Consortium

 Interstate Consortium

 Intrastate Consortium

 Community now receives EAS subsidy

 Community (or Consortium member) previously received a Small Community Grant

If previous recipient:

Date of Grant: ____________________

Expiration Date of Grant: ____________________

B. Public/Private Partnerships

Public

 Capital Region Airport Authority

 City of Lansing

 County of Ingham, Michigan

Private

 Lansing Regional Chamber of Commerce

 Regional Business Travel Trust

C. Project Proposal 

 Marketing Upgrade Aircraft New Route

 Personnel Increase Frequency Low Fare Service

 Travel Bank Service Restoration Subsidy

 Surface Transportation Regional Service Other (specify)

 Revenue Guarantee Launch New Service

 Start-Up Cost Offset First Service

 Study Secure Additional Carrier
 

 

Capital Region International Airport, Lansing, Michigan

Small Community Air Service Development Program Proposal – 2010 

37

D. Existing Landing Aids at Local Airport

 Full ILS Outer/Middle Marker Published Instrument 

Approach

 Localizer Other (specify)

E. Project Cost

1. Federal amount requested: $1,000,000

2. State cash financial contribution:

3. Local cash financial contribution: $250,000

3a. Airport cash funds: $100,000

3b. Non-airport cash funds: $150,000

3c. Total local cash funds (3a + 3b): $250,000

4. TOTAL CASH FUNDING (1 + 2 + 3c): $1,250,000

5. Local funds contributed from already-existing

programs or projects included in line 3c amount: $100,000

6. Local funds contributed from new commitments 

or new resources included in line 3c amount: $150,000

7. Airport in-kind contribution:

(waived landing fees)

$200,000

8. Other in-kind contribution:

(amount & description) $200,000

9. TOTAL IN-KIND CONTRIBUTION (7 + 8): $400,000

10. TOTAL PROJECT COST (4 + 9): $1,650,000

F. Enplanements

2000 331,363 2004 329,598 2008 217,138

2001 265,199 2005 310,924 2009 134,746

2002 260,190 2006 284,755

2003 271,161 2007 253,162

G. Is this application subject to review by state under Executive Order 

12372 Process?

 a. This application was made available to the State under the Executive Order 12372 Process for review 

on (date):

 b. Program is subject to E.O. 12372, but has not been selected by the State for review.

 c. Program is not covered by E.O. 12372
 

 

Capital Region International Airport, Lansing, Michigan

Small Community Air Service Development Program Proposal – 2010 

38

H. Is this applicant delinquent on any federal debt?

 No

 Yes (explain)
 

 

Capital Region International Airport, Lansing, Michigan

Small Community Air Service Development Program Proposal – 2010 

39

APPENDIX B: COMMUNITY BACKGROUND

Capital Region International Airport

Capital Region International Airport serves as the primary airport for the Lansing area and Central Michigan. As 

such, the Airport is equipped with a primary runway of 8,001 x 150 feet, including dual instrument landing system 

approaches – which can handle virtually any aircraft in virtually any weather conditions. The Airport also features 

one crosswind runway, once which is 5,001 x 150 feet and is used primarily for general aviation traffic.

The Airport’s main terminal is almost 161,500 square feet, with 11,942 square feet in the ticketing lobby and 

baggage claim area (landside), and almost 28,212 square feet of space beyond security on the airside concourse. 

The airline concourse features nine gates – with gate space available immediately. The Airport also has ticket 

counter and baggage make-up space immediately available for a new airline (although United would simply use 

its existing facilities at the airport for new Washington service). 

The Airport’s air carrier apron is 60,070 square yards, with parking space for as many as eight regional jet aircraft 

and five mainline aircraft. The Airport has overnight apron space available immediately for an additional air 

carrier.
 

 

Capital Region International Airport, Lansing, Michigan

Small Community Air Service Development Program Proposal – 2010 

40

Lansing and the Surrounding Region

The Lansing Region is comprised of Ingham, Eaton and Clinton Counties with the capital city of Lansing sitting at 

the center. With an MSA population of about 454,000, the area's residents are well distributed among unique 

urban, suburban and rural settings. The region is strategically located within 90 minutes of 90% of Michigan's 

population. Located in the heart of Michigan, the Lansing region is a hub of commerce, culture and government.

The lively state capitol, the picturesque setting of Michigan State 

University, the vigorous industrial base of General Motors and 

bountiful agriculture make the region among the most stable and 

diverse economies in Michigan. The Lansing region is a leading 

force in automotive manufacturing, scientific research, 

technological development, warehousing and distribution. In the 

past decade, industries such as healthcare, bio-technology, 

information technology and insurance and financial services have 

added to the diversity of the economy. Situated within a one-day 

drive of 55% of the US population and 65% of the Canadian GNP, 

the Lansing Region's central location makes it an essential player in the North American market. The healthy 

economic climate of the region is further strengthened by excellent schools, higher education, affordable housing, 

a qualified diverse workforce and a low cost of living.

Cultural events and attractions are plentiful in the region and enrich the lives of its residents. The Lansing Region 

hosts music and art festivals, cultural celebrations, Broadway productions and Big Ten Sports. Museums, 

historical sites, nature preserves and golf are just a few more of the numerous attractions in the region.

The Lansing Region was recently awarded the "Five Star Quality of Life Quotient" rating by Expansion 

Management Magazine and is the only area in Michigan receiving this top rating. The region is home to a thriving 

and stable economy, a dynamic and capable workforce and abundant cultural events and attractions. The region 

is a hub for commerce and recreation, and ideal location for business.

Demographic and Economic Overview

The Capital Region International Airport Catchment Area (ACA) is home to 1.1 million people within its immediate 

catchment area and 6.1 million people within 75 miles of the airport. The median family income in the Lansing 

area was more than $56,223 a year in 2010, but that income translated to the purchasing power of almost 

$59,000 due to the low cost of living. Lansing’s cost of living is low due to the fact that its median home price is 

$63,060 – more than $120,000 less than the current national average. Lansing’s median family income ranks as 

The State of Michigan Capitol Building 

and the skyline of Lansing, Michigan 
 

 

Capital Region International Airport, Lansing, Michigan

Small Community Air Service Development Program Proposal – 2010 

41

the fourth highest among MSAs surrounding Lansing and is 12.5% higher than the weighted average family 

income in the region. 

Although Michigan has been hit especially hard by the recession in the United States, Lansing has the second 

lowest unemployment rate in the state; only Ann Arbor had a lower unemployment rate. In June 2010, the 

unemployment rate of the Lansing MSA was 10.6% versus Michigan’s statewide unemployment rate of 13.1%.

Exhibit 23: U.S., Michigan and Michigan MSA Unemployment Rates – June 2010 (Bureau of Labor Statistics data)

The Economy of Lansing and Mid-Michigan

The Greater Lansing Region is in the midst of an economic renaissance, as its 

economy shifts away from auto and other heavy manufacturing and towards health 

care and high-tech. In the last two years, Greater Lansing has surpassed all other 

Michigan regions in job creation, adding more than 3,000 new jobs. In that same 

time period, new and existing Businesses have invested nearly 3⁄4 billion dollars in the Lansing regional economy.

As Michigan’s capital city, Lansing is the center for governmental Business, high-tech investment, health care, 

and corporate headquarters in Central Michigan. Inc. Magazine has recognized several Lansing regional 

companies on the magazine’s list of the 5,000 fastest growing companies based on revenue growth. Those 

companies recognized include; Liquid Web, Top Flite Financial, Axiom Group, ICS Marketing Support Services, 

TechSmith and Fincor Holdings. Entrepreneur Magazine has named Michigan State University and the City of 

East Lansing as one of the Ten Best College Towns to start a business. The Federal Bureau of Economic 

9.5%

13.1%

14.3% 14.1% 13.9% 13.1% 12.3% 12.0% 11.5% 11.4% 11.1% 10.6%

9.3%

0%

2%

4%

6%

8%

10%

12%

14%

16%

Unemployment Rate
 

 

Capital Region International Airport, Lansing, Michigan

Small Community Air Service Development Program Proposal – 2010 

42

Analysis recently reported that the Lansing Metropolitan Statistical Area ranked second in the state of Michigan 

for GDP growth between 2005 and 2008.

Exhibit 24: Distribution of Lansing Area Employment by Industry

Government

29%

Trade, 

Transportation, 

Utilities

16%

Educational and 

Health Services

11%

Manufacturing

9 %

Professional and 

Business Services

9 %

Leisure and 

Hospitality

9 %

Financial Activities

7 %

Other Services

5 %

Natural Resources 

and Construction

4 %

Information

1 %
 

 

Capital Region International Airport, Lansing, Michigan

Small Community Air Service Development Program Proposal – 2010 

43

Largest Employers in the Region

Led by the State of Michigan and Michigan State University, each with over 10,000 employees, the 25 largest 

employers in the Lansing area employ over 65,000 employees (Exhibit 25).

Exhibit 25: 25 Largest Employers in the Lansing MSA and Number of Employees

Rank Employer

Number of 

Employees

1 State of Michigan 14,355

2 Michigan State University 11,218

3 Sparrow Health System 7,400

4 General Motors 6,000

5 Lansing Community College 3,180

6 Ingham Regional Medical Center 2,500

7 Lansing School District 2,106

8 Meijer Stores 2,000

9 Auto Owners Insurance 1,500

10 Peckham, Inc. 1,400

11 Jackson National Life Insurance 1,393

12 Ingham County 1,258

13 City of Lansing 1,240

14 US Postal Serive 1,200

15 WalMart, Inc. 1,185

16 Dart Container 1,144

17 John Henry Company 750

18 Quality Dalry 730

19 EDS,Electronic Data Systems 660

20 Michigan Farm Bureau 650

21 Holt Public Schools 643

22 City of East Lansing 634

23 Grand Ledge Public Schools 630

24 SBC Ameritech 625

25 Farm Bureau 625

Total 65,026
 

 

Capital Region International Airport, Lansing, Michigan

Small Community Air Service Development Program Proposal – 2010 

44

The Auto Industry

General Motors announced in December 2009 it will operate its 

Lansing Delta Township Assembly Plant on three shifts as 

demand for its line-up of crossover vehicles increases. This will 

include 2,928 hourly and 265 salaried employees (before the future 

addition of the third shift). The Chevrolet Traverse, Buick Enclave and 

GMC Acadia will all be assembled here. December 2009 sales of the 

Traverse increased 92%; Acadia increased 49% and Enclave increased 37%.

In addition to the Delta Township Assembly Plant, Lansing is also home to the Grand River Assembly Plant. This 

includes 1,800 hourly and 200 salaried employees. The Cadillac STS, SRX and CTS are assembled here. 

Cadillac sales were up 7% in December 2009, driven by a 357% increase in the SRX to 4,880 units. 

The Insurance Industry

Lans

ing 

is 

the 

insurance capital of the Midwest with headquarters of two of the largest insurers in the United States, along with 

eight major insurance companies operating large corporate offices in the area. Auto-Owners Insurance, 

headquartered in Lansing and ranked 465 on the Fortune 500 list. Auto-Owners is planning a new $105.3 million 

expansion of its headquarters that would create 800 new jobs. Auto-Owners has offices in twelve markets that 

Southwest flies to out of Chicago Midway.

Jackson National Life Insurance employs almost 1,400 people at its headquarters in Lansing, with other major 

operations in Chicago, Denver, Santa Monica, and Tampa. Other major insurance companies with regional 

headquarters in Lansing include Farm Bureau, Blue Cross/Blue Shield, Delta Dental, Michigan Millers, Accident 

Fund of Michigan and AP Capital. Insurance Companies employ close to 8,000 people in the region, with more 

than $100 billion in total assets.

IBM Computer Center Brings Jobs to East Lansing

In support of the regions technology corridor, IBM is opening a Global Delivery Center for 

Application Services The center is expected to immediately bring 100 jobs to East Lansing, and 

possibly as many as 1,500 over the next five years. The center is the first of its kind in the U.S. for IBM. The 

center will provide innovative application development and support services to modernize IT systems for state 

government, universities, health care and telecommunication business sectors.
 

 

Capital Region International Airport, Lansing, Michigan

Small Community Air Service Development Program Proposal – 2010 

45

Accident Fund Expansion to Create up to 500 New Jobs in Lansing

Accident Fund Insurance Company of America is in the middle of a $182 million 

expansion of its corporate headquarters. Accident Fund’s campus headquarters is anchoring several new 

riverfront developments in downtown Lansing. The fast-growing company, a subsidiary of BCBSM, will be 

creating up to 500 new jobs and has chosen the Board of Water and Light’s historic Ottawa Street power station 

to accommodate the growth.

Nuclear Physics Research Project Boosts Local Economy

The U.S. Department of Energy awarded Michigan State University the Facility for Rare Isotope 

Beams (FRIB). The $550 million research project is estimated to bring 400 jobs to Michigan. The 

facility will enable researchers from around the world to address leading edge questions in nuclear 

structure and astrophysics. As an economic development accelerator, the FRIB will result in an estimated $1 

billion in new economic activity. 

Lansing is Home Some of the World’s Most Advanced Manufacturing

General Motors Corporation recently said it would close 14 plants nationwide, but GM has committed to 

increasing production at its two assembly plants in Lansing. This reflects the positive union-labor relationship in 

our region and the strong manufacturing skills set of our region’s work force. Demmer Corporation is a key 

supplier to the U.S. Aerospace and Defense Industries. Dowding Machining develops new technologies that 

could revolutionize the alternative energy industry. Spartan Chassis, supplies custom chassis for emergency 

rescue vehicles and many military vehicles. WJG Enterprises manufactures high-tech medical devices.

Select Company Profiles

Neogen Corporation

Neogen Corporation is an international food and animal safety company 

headquartered in Lansing. Neogen was named to Forbes Magazine’s annual list 

of the 200 best Small Companies in America for the 8th time in the last 10 years. 

Neogen currently has distribution in over 100 countries with 40% of its revenues 

coming from international markets.

Emergent BIOSolutions

Emergent BIOSolutions is an international biopharmaceutical company that

maintains significant operations in Lansing. The company is developing an array 
 

 

Capital Region International Airport, Lansing, Michigan

Small Community Air Service Development Program Proposal – 2010 

46

of biodefense and commercial products and currently manufactures the only FDA approved anthrax vaccine at its 

Lansing operation. 

TechSmith Corporation

TechSmith Corporation is located just outside Lansing, and is the world’s leading provider 

of screen capture and recording software for computing.

Niowave 

Niowave is a high tech manufacturing company producing parts and 

equipment for the superconducting particle accelerators

Drath’s Corporation

Drath’s Corporation founded in 2005 as a Michigan State University technology 

commercialization company plans a $41 million headquarters, research and pilot manufacturing 

facility in the Lansing region. Drath’s is expected to create up to 200 new jobs with the 

expansion.
 

 

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Higher Education

The Lansing Region boasts a strong educational presence in the state of Michigan. Michigan State University, 

with its Land Grant tradition of multi-disciplinary offerings, hosts nearly 47,000 students on its park-like campus of 

about 2,000 contiguous acres. An additional 5,000 acres of research farms and woodlots are connected to the 

south of the main campus. MSU has a well renowned presence in the fields of business, education, engineering, 

high-energy physics, agriculture and life sciences (including three medical schools). Students from over 100 

countries are enrolled, reflecting the university's ever-expanding global presence. Lansing Community College, 

with over 20,000 students, provides applied programs, many of which work in concert with the labor demand of 

area employers. Cooley Law School is the nation's third largest law school. Along with these major institutions, 

many of the state's seventeen public universities, including the University of Michigan, are also represented in the 

Lansing Region and offer graduate-level programs. 

Michigan State University

Michigan State University (MSU), home of the Spartans, is a research university located in East Lansing. MSU 

plays a significant role in the economy of the region.

Enrollment was 46,648 in the 2008-2009 academic year, with 4,509 international students and 3,100 students 

studying abroad in 60 countries. MSU is the largest university in Michigan, and is the eighth largest university in 

the United States. The university has gained an international reputation for research and its sponsored funding 

tops $300 million. MSU’s travel budget for the 2008-2009 academic year was over $7 million for air travel.

MSU is also a center for athletics, with more than 30 programs competing in the Big Ten Conference. The 

campus is home to Spartan Stadium, a huge football facility seating 75,000 fans – which sells out every home 

football game. The Breslin Center area seats close to 15,000 fans for basketball – MSU’s men’s team sells out 

more than 25 dates per year.

Exhibit X: Spartan Stadium at Michigan State University
 

 

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Points of Interest

Potter Park Zoo

The historic Potter Park Zoo, located along the Red Cedar River in Lansing, has more than 400 animals and 

numerous programs and events for children and families. With annual attendance increasing every year since 

2006 (137,236 in 2008 compared to 110,167 in 2006) there are $667,100 in capital improvements planned for 

2009 including a giant walk-in aviary and a new female tiger. This is in addition to $1.3 million spent on capital 

improvements in 2008.

The Arts

Lansing is lucky enough to have more than its share of the cultura l arts. 

The Greater Lansing Ballet Company is an award-winning ballet and dance 

company. The Lansing Symphony Orchestra has been entertaining 

generations of Lansing area residents since 1929. The Kresge Art 

Museum, the MSU Museum, and the Abrams Planetarium are highly 

acclaimed cultural destinations located on the campus of Michigan State University in East Lansing. The Lansing 

JazzFest and the Old Town BluesFest host leading musicians, and are two of the larger music festivals held each 

year in the State. The Riverwalk Theatre, the Lansing Civic Players, and the BoarsHead Theater are all located 

downtown. The Wharton Center for Performing Arts recently began a 24,000 sq/ft expansion having already 

spent over $1.3 million in 2008.Many Broadway shows come to The Wharton Center before making it to theaters 

in larger places such as Chicago.

Farmers' Markets

Lansing has several farmers' markets throughout the city in the summer 

months. These markets include the Allen Street Farmer's Market on the city's 

eastside, the Old Town Farmer's Market, and the year-round historic 

Lansing City Market located near downtown. The Lansing City Market is 

building a brand new $1.6 million facility on the riverfront in downtown 

Lansing where it will continue its year round operations providing 

specialty items in addition to regular groceries from over 30 vendors.
 

 

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Festivals and Events 

Both the resident and the visitor benefit from the numerous festivals and events 

held in Lansing throughout the year. The Common Ground Festival is a musical 

event held over a week every July at the Adado Riverfront Park in downtown 

Lansing pulling in crowds over 90,000 for the week. It has wide range of musical 

acts. The Old Town Festival of the Moon and Sun is a two day festival full of food 

and live music. Old Town Oktoberfest is a two-day event drawing hundreds to the Old Town neighborhood for 

live polka music, authentic German food and of course world renowned German-style beer. 

Museums and Libraries 

Lansing is home to a wealth of museums and libraries. The Impression 5 Science Center is a children's museum 

located in a historic wagon works factory on the Grand River. The Michigan Women's Hall of Fame, is a museum 

dedicated to the historical accomplishments and achievements of women in Michigan. The R.E. Olds 

Transportation Museum is named for Ransom E. Olds, founder of Oldsmobile. It is one of the top-rated 

automotive museums in the United States, and the museum is dedicated to the education of Lansing's role in the 

development of transportation, particularly the automobile. The final Oldsmobile, a dark cherry metallic "Final 500 

Collector's Edition" (#500 of 500) Alero sedan, was donated to the 

museum on April 29, 2004. The Turner-Dodge House, is a 

museum dedicated to Lansing's early pioneers. The museum sits in the 

Classical Revival-styled Turner-Dodge Mansion, built in 1858. It is on 

the National Register of Historic Places. 

The Library of Michigan and Historical Center is a highly 

regarded state library and research center. The library is one of the top 

five genealogical research facilities in the United States. The Capital 

Area District Library has 13 branches within Ingham County, some of these include: The Main library downtown, 

the Foster Library on the east side, and the South Lansing Library on the south side.
 

 

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APPENDIX C: LETTERS OF SUPPORT
 

 

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August 23, 2010

Honorable Ray LaHood

Secretary of Transportation

U.S. Department of Transportation

400 Seventh Street, SW

Washington, DC 20590

Re: Docket DOT-OST-2010-0124

Dear Secretary LaHood:

Please accept this letter of support for the Small Community Air Service Development Program application 

submitted by Capital Region International Airport (CRIA). The $1,000,000 grant will help fund a plan to establish 

essential direct air service between Lansing and United Airlines’ hub at Washington Dulles International Airport.

Lansing is the home of Michigan’s state government, Michigan State University, several major insurance 

companies, hundreds of state associations and a vibrant corporate community whose needs for air service far 

exceed the commitment currently being demonstrated by the airlines serving the Greater Lansing region. Despite 

the fact that Washington DC is the number one destination for business travelers in the region, Lansing is without 

direct service to the nation’s capital.

In addition to providing much needed direct flights to Washington DC, the proposed new air service will also offer 

travelers in central Michigan connectivity throughout the Eastern United States, as well as international 

destinations.

I am confident that the CRIA proposal will be carefully reviewed and that its merit will be readily apparent. Our 

community looks forward to the opportunity to benefit from critical direct air service to Washington DC. Thank you 

in advance for your time and consideration.

Sincerely,

Tim Daman

President & CEO

Lansing Regional Chamber of Commerce
 

 

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APPENDIX D: 2009 SMALL COMMUNITY AIR SERVICE DEVELOPMENT

GRANT COMMUNITY LETTERS OF SUPPORT
 

 

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