Hartsfield-Jackson maps recovery path: W, square root or Nike swoosh?

A man uses a hand sanitizing station located in the domestic terminal at Hartsfield-Jackson International Airport in Atlanta, Wednesday, May 20, 2020. (ALYSSA POINTER / ALYSSA.POINTER@AJC.COM)
A man uses a hand sanitizing station located in the domestic terminal at Hartsfield-Jackson International Airport in Atlanta, Wednesday, May 20, 2020. (ALYSSA POINTER / ALYSSA.POINTER@AJC.COM)

Hartsfield-Jackson officials have diagrammed potential trajectories for the world's busiest airport's recovery from the pandemic. Among the shapes it could take: a W, a square root, a Nike swoosh or an L.

The airport is formulating its budget for the next fiscal year and basing its projections on a slow 5% climb in passenger counts monthly. Travel was down more than 95% at the lowest point, in April.

Meanwhile, a decline in the national unemployment rate raised hopes Friday among some analysts for a rapid V-shaped recovery of the economy.

Airlines are among the hardest hit sectors of the coronavirus pandemic, as people and businesses remain concerned about the risks of traveling. Some officials expect it could take two to five years for a full recovery of the airline industry.

Based on those latest projections, the Atlanta airport now projects about $78.4 million in parking revenue and $50.9 million in concessions revenue in the next fiscal year starting July 2020, down from normal collections of more than $147 million and more than $120 million, respectively.

“Georgia depends on our airport tremendously,” said Atlanta city council member Marci Collier Overstreet. “This is just a really hard hit.”

During a budget briefing, airport officials showed a slide with four different paths recovery might take.

Hartsfield-Jackson’s slide on potential trajectories for recovery of passenger counts. Source: Hartsfield-Jackson
Hartsfield-Jackson’s slide on potential trajectories for recovery of passenger counts. Source: Hartsfield-Jackson

“One scenario that we are starting to look at a little bit more closely is what is referred to as the square root,” said Atlanta airport chief financial officer Greg Richardson. That would bring passenger growth to a “new normal… then it would grow at a normal rate moving forward.”

While some have forecast a slow L-shaped recovery, Delta Air Lines CEO Ed Bastian said this week: “I don’t like the letter L because it never picks up again. … I’ve been more in the camp of the Nike swoosh.”

Richardson said another potential scenario is the W — in which "we would see a more immediate return of passengers," followed by another sharp decline due to a resurgence of the virus and restrictions in the fall or winter. "And then all of a sudden we would be falling back."

“We don’t want to lose sight of the impact that those scenarios could have on us,” he said.

Hartsfield-Jackson has closed Concourses B, E and parts of Concourses T and C. But a gradual recovery has begun, and the airport's plan for the return of passengers includes employee mask requirements and employee temperature scans.

The airport is preparing for the reopening of Concourse B based on Atlanta-based Delta Air Lines’ plans to resume operations there on June 25, said Hartsfield-Jackson general manager John Selden.

He said with Delta planning to return to as much as 50% of its previous level of domestic flying in Atlanta in July, the airport could have 800 or 900 flights a day.

That would still be down from an average of about 2,700 flights a day pre-COVID-19. Selden said the airport plans to defer airline rent for April-June 2020 until January-May 2021.

Hartsfield-Jackson has qualified for $338.5 million in federal stimulus funding from the CARES Act over a period of up to four years.

Richardson said the airport plans to use about $163 million of that over the current and upcoming fiscal year, leaving $175 million to use if conditions are worse than expected or to use in fiscal year 2022.

Hartsfield-Jackson, by the numbers

Total passengers, per July-June fiscal year

FY 2018: 105.2 million

FY 2019: 109.1 million

FY 2020, projected: 78.6 million

FY 2021, projected: 48.2 million

Source: Hartsfield-Jackson

In Other News