SIOUX CITY | Local officials view American Airlines as the favorite to win a new round of federal subsidies to keep flying at Sioux Gateway Airport.
American, the only carrier at the Sioux City airport, is required to offer at least 13 flights per week to and from Chicago's O'Hare International Airport, under a two-year Essential Air Service contract that expires next spring.
A holdover from the bygone era of regulated air travel, the EAS program guarantees service to rural areas and smaller airports.
The U.S. Department of Transportation on Oct. 5 formally invited carriers to offer bids for the Sioux City routes, beginning May 1. Carriers have until Nov. 5 to submit proposals. Following a public comment period, the DOT will evaluate the bids and award the new contract.
“We expect American will bid,” Sioux Gateway director Mike Collett said Thursday. “I do not know whether any of the other airlines will bid on it this time.
“We’re happy with their service, and they’re happy with the load they’re getting out of Sioux City.”
Collett said airport officials have not heard from United Airlines or Delta Air Lines, two carriers that formerly flew at Sioux Gateway and bid on previous EAS contracts.
Local officials said it may prove difficult for another carrier to dislodge American.
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“Fortunately, I think the numbers would support the success of the Chicago destination for American and us,” Airport Trustees President Darrell Jesse said. “I think they’ve been having good load factors.”
“If someone is going to bid, they have to be pretty competitive to match American," he added.
American, based in Fort Worth, Texas, started serving Sioux Gateway under the EAS program in April 2012, replacing the previous carrier, Delta, which flew connecting routes to Minneapolis-St. Paul.
American won its most recent EAS contract in April 2014 with a bid of $611,334 per year, down from a $1.51 million per year subsidy in its first two years. American's 2014 winning bid was nearly half that of the only other bidder that year, United, which requested a subsidy of $1.41 million per year.
“I think because American was so far under last time, the other ones will have to decide whether they’re willing to look at the cost structure that they did last time,” Collett said.
Jesse said he would like to see additional flights from American in the future, such as connections to its main hub in Dallas/Fort Worth.
The Sioux City airport has demonstrated a demand for westward flights, he said. Frontier Airlines flights to Denver were nearly 90 percent full last summer during the low-cost carrier's brief stay in Sioux City. Frontier ended the flights in October 2014 as it moved aircraft to other cities.
“Their flights were really full,” Jesse said. “It’d be nice to get that expansion. We’re not afraid to ask for that.”