October 4, 2013

Horry County on track to owe airliner $570,000

Agreement with WestJet also netted $6.6 million in first-time visitor boost to economy

Horry County is on track to owe Canadian airliner WestJet about $570,000 because of a lackluster first year of twice-weekly flights to and from Toronto and Myrtle Beach.

However, a survey taken by the Myrtle Beach International Airport found that the nearly 2,000 first-time visitors to the Grand Strand had an estimated $6.6 million impact on the economy.

In May, WestJet began serving Myrtle Beach twice weekly in an agreement that runs through Oct. 23. In that agreement, called a Revenue Guaranty Agreement, it ensures the carrier would receive a 15 percent profit margin on operations directly related to service on WestJet to Myrtle Beach International Airport for a period of six months, with a maximum exposure to the county not to exceed $1 million.

Based on internal forecasting by the Horry County Department of Airports released Friday, it is currently projected that the county will owe WestJet about $570,000 under the agreement. The official tabulation of the amount due WestJet will not be available until late December 2013, according to a press release issued by the county.

“Although this first season was not as strong as we had hoped, WestJet did open Myrtle Beach to new markets across Canada,” said Chris Eldridge, Horry County Administrator, in a press release. “The relationship between MYR, WestJet and the Myrtle Beach Area Chamber of Commerce is one that can be used to enhance the diversification of our tourism base and flight services. Horry County is currently exploring alternate means of funding the agreement with the Myrtle Beach Area Chamber of Commerce. Any future financial arrangements will be directly between WestJet and the Chamber.”

Based on passenger numbers, as reported to the airport by WestJet, the airline has flown over 3,200 passengers to the Grand Strand from May through August. During August 2013, the airline flew more people to the market than any previous month; almost 1,060 passengers, according to the press release.

The relationship between the airline and the airport did sprout first-time visitors. About 60 percent of those who flew from Toronto to Myrtle Beach on WestJet were first-time visitors. About 63 percent of those first-time visitors stayed in the Grand Strand for more than seven days, and more than half of them reported having a household income of more than $100,000, according to figures provided by Myrtle Beach International Airport.

The largest figure on the report is the estimated $6.64 million impact the first-time visitors had on the Horry County economy.

"Our community has benefited immensely through WestJet's promotion of our destination brand as well as the incremental economic impact, which is substantial,” said Brad Dean, President and CEO of the Myrtle Beach Area Chamber of Commerce, in a press release. “We continue to work with WestJet to optimize their 2013 passenger count and have begun the planning process for what we expect will be even better results in 2014."

“Despite the slow start we are optimistic WestJet will return for its second season starting May 2014,” said Pat Apone, Interim Director of Airports for Horry County Department of Airports said in the release. “While WestJet has not confirmed it will return, we believe the airline will be back as tickets for May 2014 service are now available for purchase at westjet.com.”

Brie Ogle, media relations advisor for WestJet, said in a Sept. 18 interview with The Sun News that WestJet has not decided what it will do for the 2014 season.

“As it stands we are happy with the collaborative efforts of our Myrtle Beach partners to help build the service in its first season,” she said. “It looks as though the route has strengthened month-by-month as awareness increases, and July/August were no exception. Since it is a seasonal route, we will take time over the winter to review its overall performance as we plan for summer 2014 service.”

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