Case Study

Name: Worcester Regional Airport, City of Worcester,     Massachusetts   Date: 2004-Present   Project: Strategic Business Planning and   Air Service Marketing

Summary: IMG was retained by the City of Worcester to prepare the airport’s Strategic Business Plan and provide air service marking assistance to Worcester Regional Airport (“the Airport”). 

The object of the strategic business plan was to determine the most effective managment strategy for the Aiport.  The initial study included an evaluatioin of the City's options to reduce the Airport's operating deficit, determine future management alternatives, identify revenue opportunities and determine the finanical impacts of potential operational scenarios. IMG assessed the market dynamics of the central New England region, reviewed the airport’s operational requirements including commercial and general aviation facilities, examined development opportunities, and modeled the airport’s business and overall financial situation.   As a follow-up task, IMG was asked to assist the City in carrying out the recommended strategies.

After being awarded marketing grant funds by the Department of Transportation (DOT), the City asked IMG to support its efforts in effectively promoting the Airport to restore commercial air service at the Airport.

Issue: In the 1990s Worcester Regional Airport was a prosperous commercial airport.  In 2001 the Airport served approximately 130,000 passengers; however, the events of September 11, 2001 severely reduced the demand for air travel globally, nationally, and within the New England region.  As a result, the airlines serving the Worcester community halted air service to the Airport, leaving Worcester without commercial passenger service.  As a result, ORH lost its Primary Airport status with the FAA and virtually all of its entitlement funding.  The loss of funding coupled with high operating costs, debt service obligations (for which the City was responsible), and lack of funding source(s) for development/improvements left little hope for the future of ORH. 

Solution: IMG evaluated the City’s options and based on financial projections of various operating and governance scenarios/alternatives developed a Strategic Business and Marketing Plan for the governance and marketing of the facilities to restore service.  The city reached an agreement with the Massachusetts Port Authority (“MassPort”) on a joint operating agreement. IMG was asked to continue the engagement and implement the Strategic Business and Marketing Plan. 

Value Created: IMG and Worcester were successful in attracting an airline in 2005, which served the airport for a period of 12 months with service to Orlando. Since the carrier’s departure in late 2006, IMG has continued to provide air service marking support and is advising the airport in its negotiations with prospective air carriers. IMG is also supporting the City of Worcester in its continued negotiations with MassPort over a new extended operating agreement whereby Massport would assume operating control of the airport and relieve the city of most of the airport’s annual deficit.