Proposal under the Small Community 

Air Service Development Program

Docket #: DOT-OST-2011-0119

Legal sponsor: County of Kalamazoo

DUNS: 134404099

Congressional District Code: MI-06

Contact: Clifton E. Moshoginis, CM - Airport Director

Address: 5235 Portage Road, Kalamazoo, MI 49002-1766

Phone: (269) 388-3668 

Email: cemosh@kalcounty.com

Kalamazoo-Battle Creek

International Airport

Kalamazoo, MI


Proposal under the Small Community Air Service Development Program

Kalamazoo/Battle Creek International Airport

Prepared by

Table of Contents

Table of Contents

Page

Summary Information ................................................................ 1

Proposal Highlights.................................................................... 2

Higher than Average Airfares.......................................................... 2

Community Cost Contribution ......................................................... 2

Public-Private Partnership............................................................... 3

Material Benefits ............................................................................. 3

Use of Funds in a Timely Fashion................................................... 3

Air Service Environment............................................................ 4

Market Reach and Potential............................................................ 4

Large and Diverse Employers......................................................... 5

Higher Education ............................................................................ 6

Tourism........................................................................................... 7

Air Service – Existing and Historical ........................................ 8

Existing Air Service......................................................................... 8

Historical Air Service....................................................................... 9

Extenuating Factors that have Affected Air Service...................... 11

Past Air Service Development Efforts ........................................... 11

Air Service Needs and Deficiencies........................................ 12

Higher Than Average Fares.......................................................... 12

Underserved Market Driving High Diversion ................................. 13

Unmet Business Travel Demand .................................................. 13

Strategic Plan – Air Service..................................................... 15

Project Goals ................................................................................ 15

Proposed Air Service .................................................................... 15

Airline Participation ....................................................................... 15

Market Analysis............................................................................. 16

Alternate Plan ............................................................................... 17

Previous Grant Recipient - New Project and Goals ...................... 17

Strategic Plan – Implementation and Funding ....................... 19

Public-Private Partnership............................................................. 19

Incentive and Support Plan........................................................... 20

Strategic Plan Funding.................................................................. 22

Project Continuation and Sustainability......................................... 22

Schedule and Monitoring......................................................... 23

Milestones for Timely Completion of Project................................. 23

Strategic Plan Monitoring Program ............................................... 24

Appendix A. Marketing, Public Relations and 

Communications Plan .................................................. 25

Appendix B. Community Support ........................................... 33

Appendix C. Detailed Market Analysis.................................... 50
Proposal under the Small Community Air Service Development Program

Kalamazoo/Battle Creek International Airport Summary Information

1

Summary Information

A. Applicant Information: 

(Check all that apply)

X

Not a 

Consortium

Interstate 

Consortium

Intrastate 

Consortium

Community now receives EAS subsidy

X

Community (or Consortium member) previously 

received a Small Community Grant

If previous recipient, Date of grant: 2004

Expiration date of grant: September 2006

B. Public/Private Partnerships: 

(List organization names)

Public Private

County of Kalamazoo Southwest Michigan 

First

Kalamazoo County 

Convention & Visitors Bureau

C. Project Proposal: 

(Check all that apply)

X Marketing Upgrade 

aircraft X New route

Travel Bank Service 

restoration Subsidy

Surface 

transportation

Regional 

service X Revenue guarantee

Launch new 

carrier X Start-up cost offset First service

Study X Secure addtl

service

Other (explain 

below)

D. Existing Landing Aids at Local Airport:

X Full ILS X Published Instrument Approach

X Localizer X Outer/Middle Marker

X Other (specify): PAPI, VOR

E. Project Cost:

Line Description Sub

Total

Total

Amount

1 Federal amount requested $500,000

2 State cash financial 

contribution $0

Local cash financial 

contribution

3a Airport cash funds $170,350

3b Non-airport cash funds $110,000

3 Total local cash funds 

(3a+3b) $280,350

4 TOTAL CASH FUNDING 

(1+2+3) $780,350

In-Kind contribution

5a Airport In-Kind

contribution** $12,820

5b Other In-Kind

contribution $30,000

5 TOTAL IN-KIND 

CONTRIBUTION (5a+5b) $42,820

6 TOTAL PROJECT COST 

(4+5) $823,170

F. In-Kind Contributions:

For funds in lines 5a (Airport In-Kind contribution) and 5b 

(Other In-Kind contribution), please describe the source(s) of 

fund(s) for each.

Airport In-Kind: Fee Waivers

Other In-Kind: Marketing match

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.

H. Is the Applicant delinquent on any Federal 

debt? (if “yes”, provide explanation)

No

Yes (explain)

X

X
Proposal under the Small Community Air Service Development Program

Kalamazoo/Battle Creek International Airport Proposal Highlights

2

Proposal Highlights

his Small Community Air Service Development Program (SCASDP) grant 

application for Kalamazoo/Battle Creek International Airport (AZO) meets 

the criteria of Docket DOT-OST-2011-0119. The County of Kalamazoo, 

the airport sponsor, is requesting $500,000 in federal assistance to 

implement a $823,170 air service initiative.

The project goal is to improve air service to high demand markets in the 

Southern US, Mexico, Central and South America. New service to a Southern 

hub is the region’s top priority. The Strategic Plan, American Eagle service to 

Dallas-Fort Worth, will achieve the project goal.

Higher than Average Airfares

The lack of competitive service at AZO has led to airfares significantly higher 

than surrounding airports. Average airfares have generally been 50 percent 

higher than most airports in the region, and in calendar year 2010 AZO

exceeded the US average by 52 percent. AZO has an estimated true market of 

almost 825,000 origin and destination passengers annually; however, current air 

service only meets the needs of 32 percent of those travelers. Sixty-eight percent 

of travelers are making the costly drive to alternate airports to obtain sufficient air 

service. Local Kalamazoo companies prefer to originate travel at AZO and 

understand the need for reasonable premiums over hub airfares; however, the 

premiums are so high that they continually have to compare this additional cost 

to the lost time required to originate at an airport outside the catchment area. 

New competitive service to the Southern part of the US will reduce passenger 

diversion and lower airfares to many of AZO’s top destinations.

Community Cost Contribution

It is estimated that a $500,000 revenue guarantee, $240,000 two-year marketing

program, and fee waivers will be required for a one-flight service pattern to 

Dallas. The research and analysis necessary to determine the viability of AZODallas service has been completed (refer to one and two roundtrip route 

forecasts in Appendix C). The route forecast is positive. Feedback from American 

Eagle has been encouraging. However, an incentive package to mitigate the 

start-up year’s risks will be required. Accordingly, AZO and its partners have 

created a Strategic Plan that addresses the economic risks that American will 

face during start-up.

T This section contains: 

Highlights of the County of 

Kalamazoo’s grant 

application to demonstrate 

how this application meets 

the priorities of the 

Program.
Proposal under the Small Community Air Service Development Program

Kalamazoo/Battle Creek International Airport Proposal Highlights

3

To support this air service initiative, AZO and the community will fund 39 percent 

of the proposed $823,170 Strategic Plan. Non-airport revenue sources will fund 

14 percent ($110,000) of the $780,350 cash requirement.

Public-Private Partnership

The County of Kalamazoo/AZO has formed a public-private partnership with two

private partners: Southwest Michigan First and Kalamazoo County Convention & 

Visitors Bureau. This partnership has worked together for many years to improve 

air service at AZO.

Material Benefits

AZO is vital to the economic future of Southwest Michigan, and its importance 

will continue to increase. AZO has a large close-in population compared to other 

airports of its size with a population over 1.7 million within 50 miles. Within AZO’s 

catchment area are several major employers including a number of Fortune 500 

companies such as Kellogg Company, Whirlpool Corporation, Stryker 

Corporation, Parker Hannifin, Pfizer and Eaton Corporation. Southwest Michigan 

is home to Western Michigan University, Kalamazoo College, Kalamazoo Valley 

Community College, Kellogg Community College, Southwestern Michigan 

College and other local educational institutions with over 45,000 college students 

in the local area. A link between AZO and Dallas will meet the needs of these 

sectors including businesses, educational institutions and other enterprises.

Use of Funds in a Timely Fashion

The public-private partnership has a solid schedule and strategic plan to ensure 

timely use of the funds. Meetings have been held with American in anticipation of 

this grant application, and the route is under consideration.

Currently the route is 

under review by 

American Eagle, and 

they continue to 

express interest. 
Proposal under the Small Community Air Service Development Program

Kalamazoo/Battle Creek International Airport Air Service Environment

4

Air Service Environment

ZO is a county-owned non-hub airport serving Southwest Michigan. AZO 

is vital to the economic future of Southwest Michigan, and its importance 

will continue to increase. This section shows the broad segment of the 

traveling public, including businesses, educational institutions and other 

enterprises that will benefit from the proposed Strategic Plan.

Market Reach and Potential

AZO has a large close in population compared to other airports of its size. Within 

a 25-mile radius is a population of approximately 455,000; expanded to 50 miles 

the population increases to over 1.7 million. 

AZO’s primary catchment area, shown in 

Exhibit 3.1, has a population of almost 

540,000 residents and covers 2,562 

square miles.

Population is expected to grow six percent 

from 2010 to 2020 while household income is 

anticipated to grow by 51 percent.

Comparatively, the state of Michigan 

population is projected to grow by 

four percent.

While AZO enplaned over 141,000

passengers in 2010, an estimated 68 percent 

of local travelers diverted from the area and 

used other surrounding airports including 

Detroit, Chicago O’Hare, and Grand Rapids.

Table 3.1 shows an estimated drive time from

the Kalamazoo community to each of these 

airports. The primary diversionary airport is 

Detroit with 28 percent of the catchment area 

making the almost two-hour drive. At a 

reimbursable rate of 55 cents per mile, this is 

costly to local businesses adding almost $140 

per trip and a loss of employee productivity.

A

TABLE 3.1 DRIVE TIME TO ALTERNATE AIRPORTS

DIVERSION 

AIRPORT MILES

ESTIMATED 

DRIVE TIME

% DIVERSION 

FROM AZO

Grand Rapids 59 1.0 hour 12

Lansing 79 1.2 hour 1

South Bend 82 1.3 hour 1

Detroit 124 1.9 hour 28

Chicago O'Hare 162 2.6 hour 17

EXHIBIT 3.1 AIRPORT CATCHMENT AREA

This section contains:

Description of the 

Kalamazoo/Battle Creek

communities in relation to 

air service to demonstrate 

the benefit to a broad 

segment of the traveling 

public.
Proposal under the Small Community Air Service Development Program

Kalamazoo/Battle Creek International Airport Air Service Environment

5

Large and Diverse Employers

The AZO catchment area has a dynamic and growing local business community 

with significant air travel demand. Within AZO’s catchment area are several 

major employers with extensive travel requirements. Southwestern Michigan is 

home to a number of Fortune 500 companies including: Kellogg Company, 

Whirlpool Corporation, Stryker Corporation, Parker Hannifin, Pfizer and 

Eaton Corporation.

• Kellogg Company: Kellogg’s home town and world 

headquarters located in the “Cereal City” of Battle 

Creek is a 30-minute drive to AZO. Kellogg is the 

world’s largest producer of cereal and convenience 

foods.

• Whirlpool Corporation: The World headquarters for 

Whirlpool Corporation, an appliance manufacturer, is 

located in Benton Harbor, Michigan and is a 60-

minute drive to AZO.

• Stryker Corporation: Stryker Corporation’s World 

Headquarters is within walking distance to AZO’s 

terminal, and Stryker’s Instruments and Medical 

Divisions are only minutes away. With four of 13 

divisions located within five miles of AZO this leader 

in the design and manufacturing of medical device 

products employs more than 2,500 employees in the 

area.

• Parker Hannifin: Parker Hannifin is a diversified 

manufacturer of motion and control systems and 

hydraulic systems. Both Parker Aerospace –

Hydraulic Systems Division and Parker Pneumatic 

Division are headquartered 10 minutes from AZO.

• Pfizer: Pfizer, pharmaceutical research and 

development and manufacturing, has its third largest 

presence in North America with 4,300 local 

employees. The Kalamazoo area is the global 

headquarters for Pfizer – Animal Health Division and 

is located 10 minutes from AZO.

• Eaton Corporation: The headquarters, research 

and engineering for Eaton Vehicle Group, Americas 

is located just 15 minutes from AZO. Eaton designs 

and produces transmissions, clutches and hybrid 

systems for trucks and commercial vehicles.

Other major employers include Denso Manufacturing, Perrigo Company, and 

MPI Research. Denso Manufacturing is less than 30 minutes from AZO 

“It’s so convenient to be 

right across the street.

Within a worldwide 

operation, we need to 

have access to a good 

airport.” 

(J. Patrick Anderson, 

VP of Strategy and 

Communications for 

Stryker)
Proposal under the Small Community Air Service Development Program

Kalamazoo/Battle Creek International Airport Air Service Environment

6

employing approximately 3,100. Denso Manufacturing is a leader in design and 

production of advanced automotive heating and cooling components and 

systems. Perrigo’s world headquarters are located in Southwest Michigan and is

the world’s largest manufacturer of over-the-counter pharmaceutical and 

nutritional products for the store brand market. Perrigo employs 2,500 residents 

less than 45 minutes from AZO. MPI Research’s world headquarters is also 

located in the area. MPI focuses on the non-clinical research needs of the 

pharmaceutical, biotechnical, chemical, agricultural and related industries and 

employs 1,500 just 20 minutes from AZO.

Improving air service at AZO will enhance future regional economic development 

efforts. Southwest Michigan companies (including Fortune 500 corporations like 

Pfizer, Whirlpool, Stryker, and Kellogg) rely on commercial air transportation in 

order to conduct business in our global economy, and they consider the quality of 

AZO’s air service as a determining factor for location or expansion in the 

Southwest Michigan region. These companies and other major regional 

employers have significant ties to locations beyond the Midwest. 

Higher Education

Expanded service at AZO will benefit colleges and universities throughout 

Southwest Michigan. Each year, thousands of students travel back and forth from

domestic and international locations to attend Western Michigan University, 

Kalamazoo College, Kalamazoo Valley Community College, Kellogg Community 

College, Southwestern Michigan College and other local educational institutions.

There are over 45,000 college students in the local area and 220,000 students 

within a 75-mile radius.

• Western Michigan University: US News & World Report lists Western 

Michigan University as one of the nation’s Top 100 public universities. 

Approximately 25,000 students attend the University from over 110 

countries, and the University has more than 4,500 faculty. The 

University is 15 minutes or less from AZO.

• Kalamazoo College: Kalamazoo College was ranked 52nd in Forbes 

Magazine’s second annual list of America’s Best Colleges. In 2010 

1,369 students from 40 states and 25 countries attended the college.

• Kalamazoo Valley Community College: Located in downtown 

Kalamazoo, enrollment in the last fiscal year exceeded 17,000 students.

• Kellogg Community College: Kellogg Community College is located in 

Battle Creek with enrollment nearing 14,000 students. 

• Southwestern Michigan College: The Dowagiac campus is less than 

50 miles from AZO, and the Niles campus is just 60 miles from AZO. 

Annual enrollment is approximately 3,000 undergraduates.

Over 45,000 students 

attend schools in 

AZO’s service area, 

and 220,000 students

are within a 75-mile 

radius.
Proposal under the Small Community Air Service Development Program

Kalamazoo/Battle Creek International Airport Air Service Environment

7

Tourism

Tourism is Michigan’s number two industry. Successful tourism initiatives in 

Southwest Michigan require that travelers have the ability to move in and out of 

the region efficiently and cost effectively. Air service improvements at AZO will 

help attract more visitors to the state for meetings, vacations and conferences.

The following is a list of just some of the events drawing visitors to 

Southwest Michigan.

• International Food Protection Training Institute (IFPTI): In 

collaboration with the US FDA this non-profit organization located in

Battle Creek trained 300 food protection specialists from 30 states in 

2009. This increased to 1,000 in 2010 and 2-3,000 in 2011.

• USTA Boys National Championships: Boys championships held in 

August in Kalamazoo for the last 67 years brings more than 400 junior 

(18s and 16s) tennis stars and their families from all over the nation.

• The International Congress on Medieval Studies: The conference 

begins in May each year but lasts through the summer. Typically the 

conference brings in more than 3,000 people from all over the world.

• Girls Big League Softball World Series: ESPN covers this 

competition every August with regional teams from the US, Canada, 

Latin America, Asia-Pacific and Europe.
Proposal under the Small Community Air Service Development Program

Kalamazoo/Battle Creek International Airport Air Service 

– Existing and Historical

8

Air Service – Existing 

and Historical

his section provides an overview of existing air service at AZO. Carriers 

providing service, service frequency, nonstop destinations and equipment 

types are included in the discussion. A summary of historical air service is 

also included with destinations, traffic levels, service providers, average 

airfares and an overview of extenuating factors that have affected air service. A 

description of air service development efforts concludes the section.

Existing Air Service

Despite steady increases in population and a 

stable economy, air service offerings from 

Southwest Michigan have decreased steadily 

since the mid 1990s, and as a result, many 

local travelers are currently forced to drive 

more than an hour to distant airports in order to 

obtain adequate air service. This problem has 

been compounded by the fact that Southwest 

Michigan Regional Airport (BEH), located 40 

miles west of AZO, has been without 

commercial airline service since August 2000, 

leaving AZO as the only airport in the region 

supporting scheduled passenger 

airline service. 

AZO enjoys scheduled airline service to hubs

throughout the upper Midwest including 

Chicago, Detroit, and Minneapolis and less 

than daily service to Florida markets including 

Orlando and Punta Gorda with seasonal 

service to West Palm Beach (Exhibit 4.1 and

Table 4.1). Detroit and Chicago together 

account for 86 percent of the AZO flights to 

Network hubs and are each less than a threehour drive from Southwest Michigan. Because 

the majority of AZO’s connecting hubs are 

geographically constrictive, they cannot be 

considered market-critical flight destinations 

by themselves.

T

TABLE 4.1 AZO EXISTING AIR SERVICE

NONSTOP

DESTINATION

MARKETING 

CARRIER AIRCRAFT

WEEKLY 

DEPT

WEEKLY 

SEATS

Chicago, IL (ORD) American ERJ (jet) 26 1,144

ERJ-145 (jet) 7 350

Detroit, MI Delta CRJ-200 (jet) 42 2,100

Minneapolis, MN Delta CRJ-200 (jet) 12 600

Orlando, FL (SFB) Direct Air B737-400 2 298

Punta Gorda, FL Direct Air B737-400 2 298

Total 91 4,790

Source: apgDat, July 2011

This section contains:

• Existing air service

• Historical air service

• Air service development 

efforts

EXHIBIT 4.1 AZO EXISTING AIR SERVICE
Proposal under the Small Community Air Service Development Program

Kalamazoo/Battle Creek International Airport Air Service 

– Existing and Historical

9

Historical Air Service

The number of airlines serving AZO, daily scheduled flights, and nonstop 

destinations offered from AZO have decreased significantly over the past 10 

years. This subsection summarizes AZO’s air service history including: 

destinations, traffic levels, service providers and airfares. Extenuating factors that 

have affected air service over time is also reviewed.

Destinations, Service Providers and Traffic Levels

Annual airport passenger enplanements, which peaked at 282,348 in 1998, have 

decreased by 40 percent since 2001, despite population growth of approximately 

four percent since 2000. Exhibit 4.1 shows the significant decrease in 

enplanements, departures and seat capacity that AZO is experiencing. AZO’s 

decline in passenger enplanements is largely due to fleet shifts, decreasing seat 

capacity and the overall economic health of several legacy carriers. 

EXHIBIT 4.1 HISTORICAL DEPARTURES, SEATS AND ENPLANEMENTS

Source: apgDat; Airport records

Table 4.2, next page, provides average weekly departures and seats by 

destination and airline from 2001 through 2011. In 2001, AZO had 235 weekly 

departures and 10,702 average weekly seats. Departures and, for the most part,

seats have declined every year thereafter reaching an 11-year low in 2011 of 91 

departures. Overall departures decreased 61 percent and seats have decreased 

55 percent. 

0

50,000

100,000

150,000

200,000

250,000

300,000

350,000

400,000

450,000

0

1,000

2,000

3,000

4,000

5,000

6,000

7,000

8,000

9,000

2001200220032004200520062007200820092010

Seats/Enplanements

Departures

Calendar year

Departures Seats Enplanements

Annual airport 

passenger 

enplanements have 

decreased by 40 

percent since 2001 

despite population 

growth.
Proposal under the Small Community Air Service Development Program

Kalamazoo/Battle Creek International Airport Air Service 

– Existing and Historical

10

TABLE 4.2 HISTORICAL DESTINATIONS AND SERVICE PROVIDERS

DESTINATION AIRLINE ITEM

MONTH OF JULY

2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011

Atlanta, GA Delta Dept 7 7

Seats 350 280

Chicago, IL 

(ORD)

American Dept 34 35 26 27 28 28 35 34 33 33 33

Seats 1,700 1,708 1,252 1,332 1,400 1,400 1,666 1,658 1,578 1,536 1,494

United Dept 35 34 21 28 28 28 21 20

Seats 1,372 1,700 1,050 1,400 1,400 1,400 1,050 1,000

Cincinnati, OH Delta Dept 28 28 35 35 35 20 18 17

Seats 1,400 1,148 1,372 1,120 1,750 800 666 798

Cleveland, OH Continental Dept 18 23

Seats 342 437

Detroit, MI Delta/

Northwest

Dept 66 54 56 52 48 42 41 41 54 52 42

Seats 3,547 3,175 3,635 3,215 2,556 2,176 1,826 2,738 2,492 2,296 2,100

Minneapolis, MN Delta/

Northwest

Dept 14 14 14 14 14 7 7 7 13 7 12

Seats 1,243 700 700 833 966 350 350 350 650 350 600

Orlando, FL 

(SFB) Direct Air Dept 2 2 2

Seats 300 300 300

Pittsburgh, PA US Airways Dept 27 27

Seats 864 864

Punta Gorda, FL Direct Air Dept 2 2

Seats 300 300

Toronto, Canada Air Canada Dept 13

Seats 234

Average weekly departures 235 192 175 156 153 132 129 119 102 96 91

Average weekly seats 10,702 9,295 8,446 7,900 8,072 6,476 5,838 6,544 5,020 4,782 4,794

Source: apgDat

Historical Average Fares

Over the last five calendar years, AZO’s average fares have far exceeded

Chicago, Detroit, Grand Rapids, Lansing, and South Bend airports in each year 

(Table 4.3). In 2010, AZO’s average fares exceeded these surrounding airports 

by 46 to 48 percent with the exception of Lansing that was a 14 percent variance. 

AZO’s average fare exceeded the average for the state of Michigan by 46 

percent and the US national average by 52 percent. This clearly indicates that 

AZO is significantly overpriced and in need of additional service in the market.

TABLE 4.3 AVERAGE ONE-WAY FARE PAID

AVERAGE FARE AZO % 

2006 2007 2008 2009 2010 DIFF

AZO $195 $198 $221 $210 $240 

Chicago (ORD) $148 $148 $164 $147 $164 47

Detroit $146 $140 $154 $143 $162 48

Grand Rapids $176 $177 $196 $172 $165 46

Lansing $164 $164 $179 $190 $210 14

South Bend $160 $156 $166 $150 $165 46

Michigan $151 $146 $162 $149 $165 46

US $149 $149 $160 $144 $158 52

Source: Data Base Products, Inc.
Proposal under the Small Community Air Service Development Program

Kalamazoo/Battle Creek International Airport Air Service 

– Existing and Historical

11

Extenuating Factors that have Affected Air Service

A lack of nonstop air service to high-demand business destinations outside the 

upper Midwest and substantially higher comparative airfares than surrounding 

airports, remain two major obstacles, preventing legitimate competition between 

AZO and other surrounding and similar sized airports. This also prevents the 

development of the Southwest Michigan market as a whole. 

Past Air Service Development Efforts 

AZO has taken a proactive approach to improving air 

service. The airport’s marketing plan contains a number of 

initiatives related to increasing the use of AZO and its 

existing carriers, while providing opportunities for new 

carriers to enter the market. AZO has worked to fill the three 

main air service needs of Southwest Michigan:

1. Add new routes with existing carriers

2. Add additional airline carriers as demand warrants

3. Secure low-fare service

Table 4.4 provides an overview of the air service 

development efforts since 2005.

TABLE 4.4 PAST AIR SERVICE DEVELOPMENT 

EFFORTS

YEAR INITIATIVE

2005

Task Force meetings

Route forecast - AA/DFW

SCASDP grant - DL/ATL service initiation

2006

ACI-NA JumpStart Conference - Met with 

DL/F9/G4/NW

Headquarters meeting with Frontier Airlines for 

DEN service 

2007

Submitted response to Frontier Airlines' Request 

for Proposals

Network USA Conference

Developed Air Service Retention and Expansion 

Committee

ACI-NA JumpStart Conference

Headquarters meeting with Continental Airlines 

for CLE service

2008

ACI-NA Air Service Planning and Data Seminar

ACI-NA JumpStart Conference

Airline Incentive Program finalized and published

Business Travel Survey

Network USA Conference

Passenger Demand Analysis - retention/diversion 

study

2009

Air Service Marketing Brochure

ACI-NA JumpStart Conference

Passenger Demand Analysis - retention/diversion 

study

2010

Airfare monitoring

Network USA Conference

ACI-NA JumpStart Conference

True Market Estimate - updated 

retention/diversion study

2011

Airfare monitoring

Route forecast - F9/MKE

Network USA Conference

ACI-NA JumpStart Conference
Proposal under the Small Community Air Service Development Program

Kalamazoo/Battle Creek International Airport Air Service Needs and Deficiencies

12

Air Service Needs and 

Deficiencies

he Air Service Needs and Deficiencies section identifies the issues at 

AZO that have limited the growth of commercial air service to the 

community. This section provides a detailed analysis to demonstrate that 

the average airfares are excessively high in this community compared to 

other communities and that AZO is underserved.

Higher Than Average Fares

The lack of competitive service at AZO has led to airfares significantly higher 

than surrounding airports. Table 4.3 showed that average airfares have generally 

been 50 percent higher than most airports in the region. Table 5.1 illustrates the 

fare inequities to AZO’s top markets that would flow over Dallas compared to

Detroit, Chicago and Grand Rapids where passengers frequently drive for 

greater travel options or due to airfare differentials.

TABLE 5.1 AIRFARES AT TOP DOMESTIC AZO-DFW CONNECTING MARKETS 

RANK

TOP 

DESTINATION

AVERAGE ONE-WAY FARE AZO PREMIUM OVER

AZO DTW GRR ORD DTW GRR ORD

1 Dallas, TX (DFW) $222 $183 $186 $191 $39 $36 $31 

2 Orange County, CA $243 $184 $210 $192 $59 $32 $51 

3 Sacramento, CA $265 $179 $197 $210 $86 $68 $55 

4 Las Vegas, NV $207 $148 $145 $174 $59 $62 $33 

5 Los Angeles, CA $254 $201 $167 $202 $53 $87 $52 

6 Phoenix, AZ (PHX) $214 $168 $169 $167 $47 $45 $48 

7 Albuquerque, NM $240 $140 $171 $155 $99 $69 $85 

8 San Jose, CA $282 $162 $218 $192 $120 $64 $90 

9 San Diego, CA $265 $194 $204 $189 $72 $62 $77 

10 Tucson, AZ $208 $156 $181 $170 $52 $27 $38 

11 Houston, TX (IAH) $283 $200 $211 $168 $82 $72 $114 

12 Austin, TX $218 $181 $189 $166 $37 $29 $52 

13 San Francisco, CA $286 $231 $185 $222 $55 $101 $65 

14 Seattle, WA $270 $210 $195 $195 $60 $74 $74 

15 San Antonio, TX $285 $172 $170 $167 $113 $115 $119 

16 El Paso, TX $245 $172 $250 $183 $73 ($4) $62 

17 Ontario, CA $288 $166 $224 $172 $122 $64 $117 

18 Baton Rouge, LA $234 $154 $180 $160 $79 $54 $73 

19 Jackson, MS $297 $203 $239 $157 $94 $59 $141 

20 Killeen, TX $297 $201 $246 $166 $97 $51 $131 

21 Fort Walton Beach, FL $405 $158 $143 $135 $248 $262 $271 

22 Shreveport, LA $350 $271 $282 $250 $79 $68 $100 

23 Amarillo, TX $245 $206 $216 $180 $39 $29 $65 

24 Lubbock, TX $289 $147 $199 $150 $142 $90 $139 

25 Corpus Christi, TX $327 $234 $240 $210 $93 $87 $117 

All Domestic Markets $240 $162 $165 $164 $78 $75 $76 

Source: Data Base Products, Inc.

T This section contains: 

AZO’s air service needs 

and deficiencies

AZO is significantly 

overpriced when 

compared to other 

airports where 

catchment area 

passengers look for 

reasonable airfares.
Proposal under the Small Community Air Service Development Program

Kalamazoo/Battle Creek International Airport Air Service Needs and Deficiencies

13

On average to the top 25 AZO-Dallas destinations, AZO’s fares are $84 higher 

one-way than Detroit, $68 higher than Grand Rapids, and $88 higher than 

Chicago. Nonstop Dallas service will help to alleviate these extremely high fare 

differentials by increasing available seats and creating new connecting options.

On a market by market basis, AZO fares are higher than alternate airports 

typically used by Kalamazoo area passengers. Local Kalamazoo companies 

prefer to originate travel at AZO and understand the need for reasonable 

premiums over hub airfares; however, the premiums are so high that they 

continually have to compare this additional cost to the lost time required to drive 

to an airport outside the catchment area.

Underserved Market Driving High Diversion

AZO has an estimated true market of almost 825,000 

origin and destination passengers annually; however, 

current air service only meets the needs of 32 percent of 

those travelers. Sixty-eight percent of travelers are 

making the costly drive to alternate airports to obtain 

sufficient air service. Table 5.2 provides AZO’s true 

market and retention for top markets and AZO in total. 

Diversion to alternate airports is even worse in several of 

the top 15 markets. AZO retains only 10 percent of the 

passengers destined for their top international market, 

Cancun, Mexico. In Florida markets such as Tampa and 

Orlando (MCO) AZO retained 23 to 25 percent of 

travelers. These low retention rates are a strong indicator 

of the need for improved air service and additional 

options for air travel in the Kalamazoo community.

Unmet Business Travel Demand

AZO’s catchment area is home to several major employers with extensive travel 

requirements. Stryker Corporation’s World Headquarters is within walking 

distance to the AZO terminal and other divisions are minutes away. The World 

Headquarters of Kellogg Company, Whirlpool Corporation, Perrigo Company and 

MPI Research are all within a short drive to AZO and support the local airport. 

Parker Hannifin, Pfizer, Eaton Corporation and Denso Manufacturing each have 

major divisions and presence within the catchment area. The reduction in AZO 

air service has had a significant impact on these companies.

In recent years AZO’s air service has been impacted by airline bankruptcies, 

mergers and strategic shifts in capacity designed to lower carrier costs as fuel 

prices peaked and carriers were forced to realign or eliminate fleets and hubs. 

TABLE 5.2 KALAMAZOO AIRPORT'S TOP 15 CATCHMENT 

AREA TRUE MARKETS

RANK MARKET

RETENTION 

%

TRUE 

MARKET 

SIZE

1 Orlando, FL (MCO) 25 24,550

2 Newark, NJ 26 23,841

3 Las Vegas, NV 25 22,571

4 New York, NY (LGA) 32 22,557

5 Atlanta, GA 32 21,905

6 Los Angeles, CA 35 21,560

7 Orlando, FL (SFB) 100 19,794

8 Phoenix, AZ 29 19,654

9 Minneapolis, MN 34 19,424

10 Denver, CO 21 18,492

11 Dallas, TX (DFW) 34 18,467

12 Washington, DC (DCA) 45 17,679

13 Tampa, FL 23 17,173

14 Cancun, Mexico 10 13,244

15 Philadelphia, PA 30 13,235

All markets 32 824,703

Source: Mead & Hunt Passenger Demand Analysis 2010
Proposal under the Small Community Air Service Development Program

Kalamazoo/Battle Creek International Airport Air Service Needs and Deficiencies

14

AZO service to Atlanta that was inaugurated with the help of a SCASDP grant 

was lost as fuel prices increased and carriers looked to avoid overflying hubs 

when they could connect via closer hubs like Cincinnati. AZO also lost service to 

Pittsburgh, Cleveland and Cincinnati hubs as carriers merged or realigned their 

operations. As capacity was removed from many other markets the carriers were 

rewarded with the expected higher load factors. The strong business market at 

AZO needs frequencies and good connections throughout the country. As 

network capacity and options were reduced the business passengers were 

forced to drive to other airports to satisfy their travel needs. Connections to the 

South have been a particular problem.

Nonstop service from AZO to the American Airlines Dallas hub creates online 

single connections to 77 cities not currently served through Chicago, Detroit, or 

Minneapolis including 27 international cities in Mexico, Central and South 

America. The 50 new US connecting destinations span the southern US from 

Florida to California where there are key cities that are only well served from 

hubs in the south. The local nonstop market to Dallas has also been a top 

destination for AZO travelers who will benefit from nonstop service.
Proposal under the Small Community Air Service Development Program

Kalamazoo/Battle Creek International Airport Strategic Plan 

– Air Service

15

Strategic Plan – Air 

Service

he Strategic Plan proposed by AZO will achieve the community’s goals 

and reduce its air service deficiencies. This Strategic Plan section 

provides a detailed description of the goals of the project and a primary 

and alternate plan for attaining those goals.

Project Goals

The project goal of this SCASDP grant application is to improve air service to 

high demand markets in the Southern part of the US, Mexico, Central and South 

America and to create new connecting opportunities to smaller markets not 

currently available from AZO. By meeting this goal airfares will be reduced and 

the need for air travelers to drive long distances to access adequate air service to 

many important destinations will be mitigated.

Proposed Air Service

AZO is only retaining 32 percent of catchment area passengers because air 

travelers are driving long distances, primarily to Detroit and Chicago, to access 

the national air transportation system. With limited service to Northeastern hubs, 

AZO lacks online single connect service to many key destinations in the 

Southern part of the United States as well as international service to Mexico, 

Central and South America.

This plan will achieve the project goals by:

• Adding nonstop service to Dallas, one of the largest destinations for 

local air travelers

• Reducing the need for air travelers to drive to Detroit and Chicago for 

affordable and competitive airfares

• Adding online single connection service to up to 50 cities in the 

Southern part of the US as well as 27 international destinations, 

primarily to Mexico, Central and South America

Airline Participation

In recent years, AZO has engaged in discussions with American Eagle regarding 

improving overall service and adding nonstop service to their Dallas hub. Recent 

discussions with American Eagle have been positive and have centered 

on Dallas.

T This section contains: 

• Strategic Plan for 

meeting AZO’s air 

service needs and 

deficiencies

• Alternate plan to meet 

the goal
Proposal under the Small Community Air Service Development Program

Kalamazoo/Battle Creek International Airport Strategic Plan 

– Air Service

16

Market Analysis

A financial analysis and pro forma route forecast have been developed for 

American Airlines/American Eagle service to their Dallas hub. Results of the 

American/American Eagle service analysis is summarized below. The complete 

analysis for Dallas service for both a one and two roundtrip schedule is included 

as Appendix C, Detailed Market Analysis.

Forecast Assumptions

Pro forma route forecast projections were completed for a one and two roundtrip 

schedule on a 44-Seat Embraer ERJ-140. The analyses include the operating 

and marketing assumptions listed below:

• Existing passengers will be divided between American/American Eagle 

and Delta Air Lines based on the number of reasonable connections 

available in the market.

• The Dallas local market will be stimulated 25 percent for one roundtrip 

and 50 percent for two roundtrips.

• American/American Eagle will capture a share of the passengers that 

are driving to competing airports (i.e. Detroit and Chicago) to travel to

Dallas and cities beyond Dallas.

Mature Market Results

Table 6.1 provides a summary of 

the American/American Eagle 

Dallas market analysis for one 

roundtrip per day on the 44-seat 

Embraer ERJ-140. Passenger 

projections were based on a 

mature market (i.e., passenger 

projections would be at 100 

percent on the first day of 

service). It is estimated that one 

roundtrip per day will generate $7.7 million in annual revenue for 

American/American Eagle. Projected system profit surpasses $2.0 million.

Airline Risk Ramp-Up Risk

It is estimated that American/American Eagle will earn a system profit of over 

$2.0 million after the market matures. Although this market is projected to be selfsustaining in the long-run, American/American Eagle will not generate this 

amount of revenue or margin at start-up. Airlines typically incur losses in new 

markets during the first year of the ramp-up period. Adding to initial economic risk 

in the market is the challenge of changing existing travel habits and airline 

TABLE 6.1 AZO-DALLAS MARKET ANALYSIS

ITEM STATISTICAL CATEGORY

MATURE 

MARKET

1 Seats per departure 44

2 Segments per day 2

3 Onboard Passengers 25,926

4 Load Factor 81%

5 Average Fare (all markets) $287

6 System revenue $7,671,146

7 System profit $2,109,209

Source: Mead & Hunt, Inc.

The Strategic Plan 

is critical in 

American Eagle’s 

decision whether 

or not to serve 

AZO to Dallas/Fort 

Worth.
Proposal under the Small Community Air Service Development Program

Kalamazoo/Battle Creek International Airport Strategic Plan 

– Air Service

17

allegiance which will take time. This could cause a longer than normal ramp-up 

period and lead to significant losses in the short-term.

Table 6.2 provides an adjustment to passenger projections to account for rampup to a fully mature market and breaks down the passenger projections for the 

first 12 months. At service initiation, it is conservatively estimated that 

American/American Eagle will realize 70 percent of the potential revenue in a 

mature market. The market will mature during the first year. The ramp-up period 

is highly dependent on service awareness and the community’s support of the 

new service. Table 6.2 also provides the estimated loss by month and in total for 

the first 12 months of service. AZO-Dallas segment revenues adjusted for the 

ramp-up period for the first year of service total $3.8 million. The total shortfall is 

expected to be $526,034 for the first year of service.

TABLE 6.2 SERVICE RAMP-UP

MONTH SEASONALITY

RAMPUPLOAD 

FACTOR REVENUE

COST 

PER 

MONTH

NET 

SURPLUS/ 

SHORTFALL

April-12 8.6% 70% 59% $265,952 $356,400 ($90,448)

May-12 8.0% 73% 56% $260,388 $368,280 ($107,892)

June-12 8.0% 76% 60% $268,601 $356,400 ($87,799)

July-12 8.3% 79% 62% $289,947 $368,280 ($78,333)

August-12 9.7% 82% 76% $353,468 $368,280 ($14,812)

September-12 8.7% 85% 73% $329,107 $356,400 ($27,293)

October-12 9.2% 88% 77% $358,357 $368,280 ($9,923)

November-12 8.7% 91% 78% $351,330 $356,400 ($5,070)

December-12 7.9% 94% 71% $331,179 $368,280 ($37,101)

January-13 7.2% 97% 66% $309,523 $368,280 ($58,757)

February-13 6.9% 100% 73% $306,335 $332,640 ($26,305)

March-13 8.7% 100% 83% $385,979 $368,280 $17,699 

Total 100.0% N/A 67% $3,810,166 $4,336,200 ($526,034)

Source: Mead & Hunt, Inc.

Alternate Plan

If AZO fails to obtain American Eagle service to Dallas, alternate carriers will be 

approached with the intent of obtaining nonstop service to another major hub that 

would provide improved air service to high demand markets in the Southern part 

of the US, Mexico, Central and South America. Alternate carrier service would 

fulfill the goals of this grant application.

Previous Grant Recipient - New Project and Goals

In 2004, the US Department of Transportation (DOT) awarded the County of 

Kalamazoo a SCASDP grant. The 2004 grant included the following goals:

• Collaborate with Delta Air Lines to promote current service.

• Introduce new nonstop service on Delta Air Lines to Atlanta.

• Improve access to Atlanta, Orlando and Tampa.

• Allow for additional low-fare seating.
Proposal under the Small Community Air Service Development Program

Kalamazoo/Battle Creek International Airport Strategic Plan 

– Air Service

18

The US DOT’s portion of the project budget, $500,000, included partial funding of 

a revenue guarantee, partial airport marketing, air service proposals, 

administrative costs related to new nonstop route negotiations and related 

studies to evaluate the service and pilot program. The previous application’s 

goals focused on Atlanta and Florida while the goals of this application are 

specific to the local Dallas market and connections to the entire Southern US as 

well as Mexico, Central and South America. As demonstrated, this application 

qualifies as a new project and meets the requirements of the SCASDP.

The County of Kalamazoo was successful in attracting Delta Air Lines’ service to 

Atlanta using funds made available through the US DOT grant. The service was 

successful and the grant was closed with only a small portion of the US DOT 

funds required because revenues exceeded expectations. Delta Air Lines 

continued the Atlanta service until the end of 2007 when rising fuel prices led to a 

restructuring of hubs where AZO and several other airports in the region lost 

Atlanta service in favor of connecting service over Cincinnati. 
Proposal under the Small Community Air Service Development Program

Kalamazoo/Battle Creek International Airport Strategic Plan 

– Implementation and Funding

19

Strategic Plan –

Implementation and

Funding

his section, Strategic Plan - Implementation and Funding, provides the 

detailed incentive and support plan required to implement the Strategic 

Plan. A legal sponsor responsible for administering the program has been 

designated, and a public-private partnership has been formed to actively 

participate in implementing the proposed project. In addition, this section 

identifies self-sufficiency of the service as an integral part of the community’s 

goals and provides a description of the community’s plan to continue with the 

project if it is not self-sustaining after the grant award expires. A detailed 

description of the funding necessary for implementation of the Strategic Plan, 

including federal and non-federal contributions, is included.

Public-Private Partnership

The County of Kalamazoo, the

owner/sponsor of AZO, has been 

designated as the sponsor of this grant 

application. The County of Kalamazoo 

has formed a public-private partnership 

with two private entities (refer to 

community support letters in Appendix 

B). Collectively, the partnership is 

committed to completing the Strategic 

Plan. Private partners in the publicprivate partnership include:

• Southwest Michigan First

• Kalamazoo County Convention & Visitors Bureau

All partners in the public-private partnership will be fully involved in the execution 

of the Strategic Plan (Table 7.1). The County of Kalamazoo will execute all 

federal grant offers, process all associated reimbursement requests and oversee 

grant administration. The County of Kalamazoo will also administer the revenue 

guarantee. AZO will be responsible for administering the $240,000 marketing 

campaign in conjunction with Southwest Michigan First and Kalamazoo County 

Convention & Visitors Bureau. Together these partners form a team committed to 

improving air service at AZO.

T

TABLE 7.1 PUBLIC-PRIVATE 

PARTNER ROLES

PUBLIC-PRIVATE 

PARTNER ROLE

County of 

Kalamazoo/AZO

Grant and revenue 

guarantee 

administration and 

assist with the local 

marketing efforts

Southwest Michigan 

First; Kalamazoo 

County Convention & 

Visitors Bureau

Assist with local 

marketing efforts, 

coordination of the 

marketing program

This section contains: 

• Description of the publicprivate partnership

• Legal sponsor

• Funding for the Strategic 

Plan

• Sustainability 
Proposal under the Small Community Air Service Development Program

Kalamazoo/Battle Creek International Airport Strategic Plan 

– Implementation and Funding

20

Incentive and Support Plan

In today’s airline environment, community 

support packages have become 

increasingly important and virtually required 

for most new service. To be effective, 

support packages must be structured to 

address the issues of new airline entry and 

ensure that the market responds quickly.

The public-private partnership proposes a 

community support package that has been 

tested and proven to be successful. To 

reduce American Eagle’s breakeven period 

and offset the risk during start-up, the 

public-private partnership proposes the 

following incentives (refer to Exhibit 7.1): marketing campaign (create service 

awareness for the American Eagle Dallas hub); revenue guarantee (reduce 

airline risk); and fee waivers (reduce airline start-up costs).

Marketing Campaign

Any marketing campaign must be targeted toward aggressive promotion of the 

service to make the new service successful and sustainable. The public-private 

partnership understands and agrees with the US DOT that a thorough 

understanding of the target market is essential for the success of new air service.

The 2012-2013 Marketing, Public Relations and Communications Plan created 

by Lam & Associates is included as Appendix A. Elements included in the

Marketing, Public Relations and Communications Plan include:

EXHIBIT 7.1 INCENTIVE PLAN

Airline Risk 

Mitigation

> Revenue 

guarantee

> Fee 

waivers

> Marketing

U.S. DOT

Airport

Community

Funding Service initiation

$

It is anticipated that 

American Eagle

would require a 

$500,000 revenue 

guarantee to initiate 

service to Dallas.
Proposal under the Small Community Air Service Development Program

Kalamazoo/Battle Creek International Airport Strategic Plan 

– Implementation and Funding

21

• Television and radio 

advertising

• Print advertising (e.g. 

newspapers, 

magazines)

• Outdoor advertising

• Social media

• Direct mail

• Trade show and 

marketing

Table 7.2 provides the marketing budget for the first and second years of 

service. AZO has established an extensive partnership agreement with many

media outlets. This $240,000 marketing campaign will be funded by non-airport 

sources ($110,000 cash and $30,000 in-kind) and AZO ($100,000 cash).

TABLE 7.2 MARKETING BUDGET

MEDIA OUTLET

YEAR 1 YEAR 2

CASH TOTAL

INKIND CASHINKIND

Television $30,000 $0 $5,000 $0 $35,000 

Print Advertising $30,000 $10,000 $7,500 $2,500 $50,000 

Outdoor Advertising $30,000 $5,000 $7,500 $2,500 $45,000 

Radio $10,000 $2,500 $5,000 $2,500 $20,000 

Social Media/Web $10,000 $2,500 $5,000 $2,500 $20,000 

Direct Mail $15,000 $0 $7,500 $0 $22,500 

Trade Show & Marketing $5,000 $0 $2,500 $0 $7,500 

Production fees $30,000 $0 $10,000 $0 $40,000 

Total $160,000 $20,000 $50,000 $10,000 $240,000 

Revenue Guarantee

To reduce airline risk and provide incentive to American Eagle to provide nonstop 

service to Dallas, this Strategic Plan includes a revenue guarantee as part of the 

community support package. Although pro forma projections for Dallas service 

are positive (Appendix C), service ramp-up and breakeven can take up to 12 

months, particularly in a market with significant barriers-to-entry. It is anticipated 

that American Eagle would require at least a $500,000 revenue guarantee to 

initiate service to Dallas. Exact terms of the revenue guarantee agreement are 

subject to further negotiations.

Fee Waivers

The air service support program includes a waiver of landing fees, apron fees 

and passenger boarding bridge fees. As part of AZO’s standard rates and 

charges, signatory airlines are charged a landing fee assessed at $1.34 per 

1,000 pounds of gross landed weight. AZO will waive landing fees for the first six

months of any new, nonstop service, including Dallas. Landing fees for the first 
Proposal under the Small Community Air Service Development Program

Kalamazoo/Battle Creek International Airport Strategic Plan 

– Implementation and Funding

22

six months are estimated at $11,170 assuming the use of the Embraer ERJ-140

with one roundtrip daily. The landing fee waiver may vary depending on aircraft 

type used and the number of roundtrips offered. Total fee waivers are estimated 

at $12,820.

Strategic Plan Funding

The public-private partnership is requesting US DOT assistance in funding 61

percent, or $500,000, of the Strategic Plan. Specifically, US DOT funding will be 

used to fund the revenue guarantee. AZO and the community will fund 39

percent of the total proposed air service program. Non-airport funding sources 

will provide 14 percent of the cash requirement and 17 percent of the funding for 

the total program including in-kind services (Table 7.3).

TABLE 7.3 STRATEGIC PLAN BUDGET

DESCRIPTION

FUNDING SOURCE

TOTAL

US DOT AIRPORT NON-AIRPORT

CASH CASH IN-KIND CASH IN-KIND

Airline incentive program:

 Marketing campaign

 Year 1 $100,000 $60,000 $20,000 $180,000 

 Year 2 $50,000 $10,000 $60,000 

 Revenue guarantee $500,000 $500,000 

 Fee waivers $12,820 $12,820 

Monitoring program $56,670 $56,670 

Airline meetings/negotiations $13,680 $13,680 

Total $500,000 $170,350 $12,820 $110,000 $30,000 $823,170 

Percent of total project 61% 21% 1% 13% 4% 100%

Percent of cash contribution 64% 22% N/A 14% N/A 100%

Project Continuation and Sustainability

Based on the positive pro forma projections for American Eagle service to Dallas, 

it is anticipated that service will be self-sustaining after the start-up period which 

can take up to 12 months or more. However, the public-private partnership 

understands that service failure is often due to the lack of awareness in the 

community. Because of this, the Strategic Plan includes a $60,000 second-year 

marketing program. In addition, should the revenue guarantee have remaining 

funds, the public-private partnership will use up to $100,000 for on-going 

marketing of the Dallas route. The Kalamazoo/Battle Creek business community 

and the public-private partnership understand the economic importance of this 

project to the region and the challenges associated with profitably operating air 

service to the Kalamazoo market and will work to ensure its long-term success.
Proposal under the Small Community Air Service Development Program

Kalamazoo/Battle Creek International Airport Schedule and Monitoring

23

Schedule and Monitoring

he public-private partnership has developed a realistic timetable for 

achieving the project goals. This section provides critical milestones to be 

achieved by the public-private partnership to timely execute this air 

service initiative. A monitoring program is also provided to track the 

progress of the project.

Milestones for Timely Completion of Project

The following target dates are proposed to track the progress of this air service 

initiative assuming a grant award by December 31, 2011:

TABLE 8.1 STRATEGIC PLAN SCHEDULE

DATE ACTION ITEM DESCRIPTION

January 1, 2012 Marketing campaign 

development

Development of the 

marketing campaign will be 

completed in January 2012 in 

order to begin the marketing 

campaign 60 days prior to 

new service initiation.

February 1, 2012 Marketing initiation

It is anticipated that the 

marketing campaign will 

begin by February 1, 2012 

and continue throughout the 

first year of new service.

April 1, 2012 Service initiation

The service start date is the 

critical date for the rest of the 

Strategic Plan. It is 

anticipated that American 

Eagle will initiate nonstop 

Dallas service in April 2012.

Air service initiation is

dependent on airline route 

planning, economics and 

availability of right-sized 

aircraft for AZO.

June 30, 2012 Alternate plan

If American has not 

committed to a date to

implement nonstop Dallas

service by June 30, 2012, 

AZO will contact other airlines 

that would meet the goals of 

this grant application.

March 31, 2013 Revenue guarantee 

contract completion

At the end of the first year of 

service, the revenue 

guarantee will be calculated 

based on the terms of the 

agreement. The revenue 

guarantee contract term will 

be based on the service 

start date.

T This section contains:

• Monitoring the project

• The plan/schedule for 

timely completion of the 

project
Proposal under the Small Community Air Service Development Program

Kalamazoo/Battle Creek International Airport Schedule and Monitoring

24

Strategic Plan Monitoring Program

The monitoring program includes service performance tracking, assessing the 

effectiveness of the campaign, impact on airfares and determining the influence 

of new service on retention at AZO. Table 8.2 provides the action items and 

frequency to monitor the Strategic Plan over a two-year period.

TABLE 8.2 STRATEGIC PLAN MONITORING

FREQUENCY ACTION ITEM DESCRIPTION

Monthly

Airline performance Load factors, enplanements, 

departures

Revenue guarantee 

indicators Ticket revenue, cost, drawdown

Quarterly

Airline performance

Load factors, enplanements, 

departures, revenue per available 

seat mile

Airfares

Compare US DOT airline reported 

average airfares on a quarterly basis, 

when available, to prior quarters

Published airfares will be monitored 

for the first three months of service 

then quarterly thereafter via one of the 

Global Distribution/Computer 

Reservations Systems (GDS/CRS)

9 Months Program assessment

Complete an overall assessment of 

the program to determine if additional 

community marketing support is 

needed beyond one year

12 Months Passenger Demand 

Analysis

Conduct a follow-up true market 

estimate to determine changes in 

passenger diversion after the first 12 

months of service. By comparing to 

the true market estimate conducted 

prior to service initiation, the true 

market estimate will determine the 

impact of the air service 

improvements on retention/diversion 

at AZO.
Proposal under the Small Community Air Service Development Program

Kalamazoo/Battle Creek International Airport Appendix A. Marketing, Public Relations and Communications Plan

25

Appendix A. Marketing, 

Public Relations and 

Communications Plan

he following is the 2012-2013 Marketing, Public Relations and 

Communications Plan prepared by Lam & Associates. This Plan is in 

direct support of and prepared for the proposed air service in the Strategic 

Plan, improved air service to high demand markets in the Southern part of the 

US, Mexico, Central and South America.

T This section contains:

The detailed marketing plan 

to support the service 

proposed in the Strategic 

Plan.
lam & associates

AUGUST 2011

2012-2013

MARKETING, PUBLIC RELATIONS 

AND COMMUNICATIONS PLAN
Situation Analysis/Background

The Kalamazoo/Battle Creek International Airport (AZO) revitalized its strategic marketing 

efforts in 2009 in concert with strategic efforts associated with the construction of the new 

airport terminal, which opened in April of 2011. In the same time frame, the airport has 

undertaken an update of its Master Plan.

The marketing, public relations and communications plans have been aligned not only 

with the strategic directives of the Aeronautics Board, but also with the overall community 

revitalization and economic development strategies. The strategic marketing plans highlight 

the airport’s role in a community which is designing its own future, in many ways uniquely. 

In very recent national rankings, Kalamazoo has been recognized among the “Best Cities 

for Recent College Graduates,” “Best Cities for Young People,” and “Best Places to Start 

Over.” The Center for Michigan, a respected “think-and-do tank,” will release data in 

September showing positive housing statistics “completely different” from the rest of the 

state, an obvious reflection of the effects of the Kalamazoo Promise, which translates into 

a quarter-billion-dollar investment in education that provides high school graduates free 

college tuition for nothing more than attending and graduating from Kalamazoo Public 

Schools.

On top of that, Western Michigan University has just received a $100 million gift to 

make possible the creation of a medical school in the community in the next few years, 

a project that is now well under way. Similarly, community investments through venture 

capitalists, Southwest Michigan First and others are resulting in the resurgence of the 

life sciences, capitalizing on the brainpower of a community with a legacy of medical 

and pharmaceutical excellence.

Kalamazoo has historically withstood the cyclical effects of downturns because 

of its diversified economic base, with unemployment rates running consistently 

and considerably below both the state and national averages (Upjohn Institute for 

Employment Research, June, 2011).

With the election of a new governor and the prospects of a more favorable business 

climate in Michigan, current economic projections remain a challenge, but Kalamazoo 

County “below-the-surface” trends make the community a fascinating market for 

business exploration and risk/reward.

Example: In an already-strong downtown setting, with high retail, 

commercial and residential occupancy rates, some $51 million in new projects 

are either near completion or on the drawing board, including a new eight-story 

building across the street from the four-diamond Radisson, where some $17 

million in improvements are scheduled through next fall. Moreover, the forces of 

community self-determination throughout Kalamazoo County continue to work 

together on several fronts, including the airport, to invest in future growth.

Example: “The Learning Network” just announced $11 million in new 

education grants, on the way to a $60 million community alignment project to 

improve the quality of life in the region. Specifically on the airport, the Chamber 

of Commerce, the Convention & Visitors Bureau (CVB) and Southwest Michigan 

First have contributed time and talent to efforts to grow and improve the airport.

The airport utilizes $50,000 a year of designated funds from the CVB to market 

itself at key events which attract travelers to Kalamazoo County, such as the USTA 

National 16-18 Boys Tennis Tournament.

2012-2013 MARKETING, PUBLIC RELATIONS AND COMMUNICATIONS PLAN / AUGUST 2011 / PAGE 2
Market Analysis & Response

The importance of the needs of the business community has never been lost on AZO. When 

Stryker Corp., with its 13 divisions, built new world headquarters literally on the doorstep of 

the airport in 2006, company leaders erased any doubt about their support of a facility that 

would be part of an overall economic revitalization plan. From a strategic marketing point 

of view, without adopting plaintive or defensive tones, the airport messages since 2009 

have prepared the business community for entry into a new era of prosperity.

Those messages were reinforced through virtually every communications vehicle aimed at 

the business community, including well-targeted business publications and a continuously 

updated mailing list of business leaders and community influentials. The underlying 

theme of “Safe. Simple. Convenient,” ties into an informal mantra of connectivity to this 

airport. The beauty of the timing, though, was the construction of the new terminal, a 

blessing that linked the airport’s “New Beginnings” message with a growing sense that 

Kalamazoo would be a player in leading Michigan out of the doldrums. 

At every possible turn, the airport is associating itself with the growing sense that 

community momentum -- by no means assured -- is real. Transferring that sense 

of momentum to the price-sensitive leisure and family travel community remains a 

significant task. Since 2009, AZO has sharpened its marketing focus by “coming 

clean” with the intention to compete head-on with worthy competitors, contrasting 

the safe, simple, convenient travel with road travel (icy and dark in winter and orange 

barrels in summer) associated with distant airports.

Without going all the way to direct “you’re worth it” messages, AZO has utilized the 

look and feel of the new terminal to open minds regarding the idea of “considering” 

and shopping Kalamazoo for the sake of paying a premium for convenience. The 

countervailing forces include the availability of direct flights from other airports -- 

which is being addressed in this grant application -- and the issue of “reliability.” 

When a flight is cancelled from Detroit or Chicago, the promise of convenience 

takes a direct hit.

This is an airline issue that every airport faces, but small- to medium-sized airports 

with fewer fallback options for the “next flight” are affected more dramatically.

THE MARKETING CHALLENGES FACING AZO ARE 

MANAGEABLE FOR THE FOLLOWING REASONS:

• Incredibly strong partnerships among business, education, civic, governmental 

and influential forces;

• The ability to target audiences with select, regionally focused media;

• Warm and welcome visitor response to the amenities, feel and layout of the 

new terminal; and

• Adequate resources to deepen important messages.

Demographically, an overall snapshot of the catchment area would not prove to 

be dissimilar to that of 20 years ago, but according to preliminary census figures, 

Kalamazoo and Allegan counties grew roughly 5 percent in the past decade, 

compared to a population drop in Michigan.

Worth noting is the buzz surrounding the area’s appeal to young families, 

combined with gap or spread between Kalamazoo and the state and nation -- 

increasingly younger by relative comparison. Those factors don’t yet speak to 

buying power, but to the underlying vitality associated with the trend. Kalamazoo 

is one of the few urban school districts, ostensibly because of the Promise, to 

buck the decline of enrollment. Something’s going on here.

2012-2013 MARKETING, PUBLIC RELATIONS AND COMMUNICATIONS PLAN / AUGUST 2011 / PAGE 3
Media Analysis & Response

Outside of the “business traveler” segment, for which AZO has a focused strategy, primary 

demographic segmentation is done by geography, age and income. Additionally, some 

assumptions regarding educational attainment can be made by conventional media. For 

example, it is fair to assume the proclamations by print media and public radio that they 

reach a more educated audience would appear to hold true. 

Media alignment by geography is favorable. Geographic targeting is necessary because 

in many markets the “spill” outside the catchment area can be a waste. Because the 

“Southwestern Michigan” area is in direct competition with Grand Rapids, and because 

there is little reason to believe that Grand Rapids media spending would be fruitful, AZO 

is particularly mindful that Grand Rapids, Kalamazoo and Battle Creek are in the same 

media market for network TV, with Kalamazoo having the CBS affiliate and Grand Rapids 

dominating ABC, NBC and Fox.

The good news is that “local” news for Kalamazoo County is primarily watched by 

Southwestern Michigan viewers, not Grand Rapids viewers. Additionally, Charter and 

Comcast distribution regions align beautifully with AZO’s catchment area. AZO can 

buy cable television, using income and geographic parameters, in combination with the 

Channel 3 news programming. In the print realm, the dominant dailies are the Battle 

Creek Enquirer and The Kalamazoo Gazette. In addition to having a reach in several 

counties, The Gazette also has regional editions. The best demographic match-ups 

for AZO -- slightly older, more educated and more affluent listeners -- happens to be 

with stations that also have news coverage. One of those feels a strong alignment to 

the airport and is offering in-kind matching dollars for this grant. The younger, lessaffluent audiences can be reached, but with less cost-effectiveness.

AZO uses outdoor advertising to reinforce other media to achieve “frequency,” and 

because it is a medium which, in essence, “can’t be turned off.” AZO also uses 

outdoors at select locations -- highways to other airports and as a reminder that 

AZO is nearby. Because of its scope and scale, outdoor also suggests that AZO is 

“in the game,” and can afford to compete with the larger airports.

Direct mail is used by AZO to reach high-income potential leisure travelers, as lists 

can combine income with geography, and post card messages, such as “Upgrade!” 

(referring to the new terminal), are attention grabbers. Electronic and social media 

strategies are evolving for AZO. HTML blast to select audiences, with an opt-out 

option could give way to facebook and Twitter, but the latter social media rely 

on news and updates, much of which in the airport world revolves around the 

airlines, not airports.

Additionally, the issues of cost and reliability, issues for AZO, are among the 

topics (security is another) that create the potential of “publish backlash,” and 

AZO is not currently in a position to assume the risk, but intends to carefully 

move forward on a social media strategy, particularly one that includes opt-in, 

opt-out and screening mechanisms. Like many airports, because of the Places 

feature and “community pages,” the airport has two community pages that have 

been used. So far, neither has been abused.

2012-2013 MARKETING, PUBLIC RELATIONS AND COMMUNICATIONS PLAN / AUGUST 2011 / PAGE 4
AZO continues to refine its message to influentials and 

business travelers, deepening the message that there is a 

link between economic prosperity and the use of the airport.

The assumption here is that such a message falls on deaf 

ears with the leisure traveler. Blessed with a new terminal, 

however, the airport is able to capitalize on the momentum 

created by the “New Beginnings” campaign that was used 

in conjunction with the opening of the new terminal and an 

open house which attracted some 8,000 area residents. The 

challenges facing AZO -- primarily set forth by very worthy 

competitors -- demand creativity associated with the critical 

choice of comparison shopping.

The issues of safety, simplicity and convenience do not 

always carry the day, but the message strategy is one of 

reinforcing those themes, primarily at opportune times. 

Relieving cognitive dissonance of the business traveler is 

most certainly a goal of message development, so little is 

done in terms of creative to highlight the differentiation. 

AZO, having studied virtually all marketing and advertising 

strategies of small, medium and medium-large airports 

across the country, is aware that “destination messages” are 

common, and for good reason.

The short hops to Detroit and Chicago, however, serve 

as a double-edge sword, and the message tends to be 

used on Internet banners (including on the AZO web site) 

highlighting more distant destinations, most notably Florida. 

AZO would greatly welcome the opportunity to promote 

Dallas/Ft. Worth, not only for the sake of that route, but as 

a signal of diversity and distance of original destinations. 

Public relations messages over the past two years have 

largely been associated with the construction of the new 

facility, traffic and enplanements at the airport, the new 

FAA tower and events and political decisions related to the 

airport.

The staff and advisory board members have utilized Letters 

to the Editor in The Gazette, where opinions regarding 

service, pricing and reliability occasionally appear. Creative 

development for promotions and advertising of AZO has 

been enhanced by the introduction of a new logo, timed to 

give the marketing effort the same type of “new” feeling 

that was generated by the new terminal itself. 

AZO was not in the market for a new logo, but Lam & 

Associates developed an option that gained instant 

approval, at the airport and in the community. The timing 

proved both intentional and ideal.

Prior to the opening of the new terminal, AZO “kept its 

powder dry” with messages aimed at holding the business 

community. Introduction of youth imagery in connection 

with the New Beginnings Campaign was largely subliminal 

in its starting over look. 

2012-2013 MARKETING, PUBLIC RELATIONS AND COMMUNICATIONS PLAN / AUGUST 2011 / PAGE 5

Upgrade!

Message Development/Content/Creative
Dallas and American-specific Message Development/Content

Marketing destinations for an airport is an excellent strategy in that it paints a picture 

that has a “window to the world” feel. The ability to promote Dallas/Ft. Worth should 

present tremendous creative opportunities that can surround the business-relationship work 

promoting the route and the uptick of traffic at the airport. Working with consultants (Mead 

& Hunt) and business partners, AZO has established a comfort level that Dallas/Ft. Worth 

and American are the best choices to develop the new route from a marketing and sales 

perspective. 

Southwest Michigan First, Discover Kalamazoo (CVB) and the Kalamazoo Regional 

Chamber of Commerce have excellent connections with the business community in 

Kalamazoo County.

Links with Battle Creek Unlimited, the Battle Creek Area Chamber of Commerce, the 

Battle Creek CVB, Kellogg and other regional business sources are also well established. 

Southwest Michigan First, for instance, has communications mechanisms with some 100 

businesses in the region, some of which are not included in the Chamber’s Kalamazoo 

Regional membership. Southwest Michigan First is an economic development force, 

recognized for leadership and success throughout the Midwest. AZO plans to take 

a collaborative approach with grantors, Dallas Ft. Worth, American and others to 

refine specific messages, with a strong emphasis on the launch of a new service, lest 

opportunities be missed.

A Dallas route significantly opens much-needed avenues to the West, the Southwest, 

Mexico and South America, and is a strong market for Battle Creek and Kalamazoo in 

its own right, according to research here. As noted above, the route also highlights 

greater diversity, frequency and distance of destinations, part of the “momentum” 

factor that fits so well into the plan to create momentum as part of a regional 

revitalization. 

2012-2013 MARKETING, PUBLIC RELATIONS AND COMMUNICATIONS PLAN / AUGUST 2011 / PAGE 6
Budget

A $240,000 budget to market this initiative, over and above the visibility associated with 

regular marketing, advertising and public relations efforts allows suitable impact in this 

media market. Radio and print sources have offered the equivalent of $30,000 in in-kind and 

leveraged advertising and communications, and the following table highlights a balanced 

spending plan in which the new offering should feel inescapable. 

 

Marketing Resources

A marketing-attuned staff and aeronautics board, in concert with advisory 

committees and key partners serve as excellent decision makers for marketing this 

initiative. 

AZO utilizes the services of Lam & Associates, a unique resource in Kalamazoo, 

specializing in community relations and marketing. Lam & Associates, in business 

for 24 years, has business, client, professional and personal relationships with 

virtually every stakeholder in the area. 

The principals -- Blaine and Bobbie Lam -- have been involved in volunteer and 

professional capacities with business organizations, foundations, nonprofits, 

governments and civic leaders at every level. Blaine Lam has served on an interim 

basis as chief administrative officer of eight different organizations, including the 

Kalamazoo Regional Chamber of Commerce, the Convention & Visitors Bureau 

(leading its reorganization) and the Arts Council of Grater Kalamazoo.

Lam has been and is involved in economic development, education and downtown 

development and was involved in the airport’s governance transfer to the County of 

Kalamazoo. With two designers on staff and the ability to work collaboratively with 

other organizations, Lam & Associates makes marketing the airport a top priority.

2012-2013 MARKETING COMMUNICATION / AUGUST 2011 / PAGE 7

Media Outlet Year 1 Year 2 Total

Television $30,000 $5,000 $35,000

Lay & Business Print $30,000 $7,500 $37,500

Print In-Kind/Leveraged $10,000 $2,500 $12,500

Outdoor Advertising $30,000 $7,500 $37,500

Outdoor In-Kind/Leveraged $5,000 $2,500 $7,500

Radio $10,000 $5,000 $15,000

Radio In-Kind/Leveraged $2,500 $2,500 $5,000

Social Media/Web $10,000 $5,000 $15,000

Web In-Kind/Leveraged $2,500 $2,500 $5,000

Direct Mail $15,000 $7,500 $22,500

Trade Show & Marketing $5,000 $2,500 $7,500

Creative/Production Costs $30,000 $10,000 $40,000

 Total $180,000 $60,000 $240,000
Proposal under the Small Community Air Service Development Program

Kalamazoo/Battle Creek International Airport Appendix B. Community Support

33

Appendix B. Community 

Support

ppendix B includes letters of support for the AZO application to the US 

DOT for improved air service to high demand markets in the Southern 

part of the US, Mexico, Central and South America. Support letters were 

submitted by participants in the public-private partnership and members 

of the Kalamazoo/Battle Creek communities. The letters of support are included 

on the following pages of this Appendix B and are listed below.

Government

United States Senate – Senator Carl Levin

United States Senate – Senator Debbie Stabenow

Congress of the United States – Congressman Fred Upton

Kalamazoo County Aeronautics Board of Trustees

Kalamazoo County Board of Commissioners

Public-Private Partners

Kalamazoo County/AZO (see cover letter)

Kalamazoo County Convention & Visitors Bureau (Discover Kalamazoo)

Southwest Michigan First

Local Businesses

Bronson Healthcare Group

Forum Communications Inc.

Kalamazoo Gazette

Kalamazoo Regional Chamber of Commerce

Midwest Communications, Inc.

Perrigo Company

PNC Financial Services Group

Stryker Corporation

A This section contains:

Letters of support from 

members of the publicprivate partnership, the 

local business community 

and state government.












MIDWEST COMMUNICATIONS, INC. 

and Affiliates 

 26 July, 2011 

The Honorable Raymond H. LaHood 

Secretary 

U.S. Department of Transportation 

1200 New Jersey Avenue SE. 

Washington, DC 20590 

Dear Secretary LaHood: 

I am pleased on behalf of Midwest Communications, Inc WKZO, WNWN, WQLR, WTVB, 

and WVFM) to announce our commitment to the Small Community Air Service 

Development Program. We strongly support the additional service proposal put forth by 

the Kalamazoo / Battle Creek International Airport. 

The Kalamazoo / Battle Creek International airport is vital to the continued economic 

development of not only the greater Kalamazoo / Calhoun county area, but also 

Southwest Michigan. 

Midwest Communications, Inc. will provide in-kind advertising and marketing support to 

promote the airport’s proposal. This spot advertising program would air on WKZO, WVFM 

and WQLR in Kalamazoo. The total value of this in-kind support is valued at $10,000. 

Additionally, our radio stations will share news and information as requested in both our 

news programs and in long form interviews. We will work to ensure our entire community 

understands the important impact this grant proposal will have on the greater Kalamazoo, 

Battle Creek area. 

Thank you for your consideration and your support of southwest Michigan. 

Sincerely, 

Peter F. Tanz, CRMC / CDMC

Vice President – Michigan Region 

Midwest Communications, Inc. 

___________________________________________________________________________________ 

Peter F. Tanz, CRMC / CDMC, Vice President – Michigan Region 269 . 350 . 3590 

4200 West Main Street . Kalamazoo, Michigan 49006 peter.tanz@wkzo.com 

 



Proposal under the Small Community Air Service Development Program

Kalamazoo/Battle Creek International Airport Appendix C. Detailed Market Analysis

50

Appendix C. Detailed 

Market Analysis

onfidential submission of the County of Kalamazoo.

C This section contains:

An in-depth analysis 

evidencing familiarity with 

the Dallas-Fort Worth 

market and ultimate 

success of the proposed 

Strategic Plan.