=20 ---------------------------------------------------------------------- This article was sent to you by someone who found it on SFGate. The original article can be found on SFGate.com here: http://www.sfgate.com/cgi-bin/article.cgi?file=3D/n/a/2009/07/08/financial/= f104644D79.DTL --------------------------------------------------------------------- Wednesday, July 8, 2009 (AP) Traffic drop doesn't worry Atlanta airport boss By HARRY R. WEBER, AP Airlines Writer (07-08) 10:47 PDT ATLANTA (AP) -- The world's busiest airport doesn't believe declining traffic, financial challenges and concerns raised in the past by its main tenant will scuttle an ongoing project to build a new international terminal, a top airport official said Wednesday. Ben DeCosta, general manager of Hartsfield-Jackson Atlanta International Airport, told reporters during a news conference he is confident the airport will secure the necessary funding to complete the $1.35 billion project, and that airlines that do business at the airport will see the value in maintaining a strong presence there. "We believe the airline business is rational, and if you are going to do business this is the place to do it," DeCosta said, asserting that the airport's lease and landing fees are low, its credit rating is solid and its operations are efficient. The comments came amid some sobering numbers. International traffic at the Atlanta airport is down more than 5 percent year-over-year, while overall traffic is down 3 percent, according to DeCosta. The situation isn't expected to improve anytime soon, as airlines cut capacity due to weak demand for air travel. Delta Air Lines Inc., the world's biggest airline operator and the biggest tenant at the Atlanta airport, plans to cut its overall international capacity by 15 percent starting in September. DeCosta seemed unfazed. "I am not concerned whatsoever about people moving flights from this airport somewhere else," he said. Spokesman John Kennedy said the airport still projects the number of international passengers that go through the Atlanta airport annually will increase to 13 million in 2015, compared with 9 million last year. Airlines that do business at the airport are playing hardball in talks over new lease agreements, threatening to move some flights to other airports if they can't maintain competitive costs on fees they pay. Earlier this year, Atlanta-based Delta threatened to move some flights to other airports if it couldn't maintain competitive costs at the Atlanta airport. AirTran Airways, a unit of Orlando, Fla.-based AirTran Holdings Inc., said it would consider doing the same if suitable new lease agreements can't be reached at Hartsfield-Jackson. The two carriers represent roughly 93 percent of the traffic at Hartsfield-Jackson. The other 7 percent of traffic there is split between other carriers including AMR Corp.'s American Airlines, US Airways Group Inc., Continental Airlines Inc., UAL Corp.'s United Airlines and several foreign carriers. The master lease agreements that apply to airlines at Hartsfield-Jackson do not expire until September 2010, but talks between the sides have been ongoing for months. According to the airport, all the airlines that do business at the facility are expected to generate about $160 million in airport revenue in 2009, including property leases and landing fees. One of Delta's concerns has been the price of the terminal project and h= ow that might factor into the amount of the airline's future costs for using the airport. Last year, Delta's vice president of corporate real estate sent a letter to prospective underwriters of the airport's bond financing stating that Delta opposed the airport's capital improvement program, which includes the terminal project. Delta's stance could factor into the underwriters' decision because the airline is the majority tenant of Hartsfield-Jackson. The airport, which has a good credit rating, said in January that it believed that because of tight credit markets at the time it would not have been able to go to market for the bonds regardless of Delta's position. While credit is still tight, the airport believes it will get the financing it needs. The Atlanta City Council recently approved an $800 million bond deal to = be used to complete the international terminal project. The bonds still must go out to bid, and Delta's position could factor in= to what interest rate the city-run airport must pay. Two Delta spokespersons did not immediately respond to an e-mail Wednesd= ay seeking comment. In the past, Delta has said that its success in Atlanta is based on a foundation of a collaborative relationship that it has had with the city. Construction work on the international terminal project at the Atlanta airport began last summer and is scheduled to be completed by 2012, airport officials have said. The project was previously projected to cost more than $1.6 billion, but the airport has cut is projection to $1.35 billion. The airport said it was able to cut materials and labor costs. The plan for the Maynard H. Jackson International Terminal was part of a broader expansion project at the airport that included a fifth runway. The runway was completed in May 2006. -----------------------------------------= ----------------------------- Copyright 2009 AP <<<<<<<<<<<<<<<<<<<<<<<<<<<<<<<<<<<<<<>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>> If you wish to unsubscribe from the AIRLINE List, please send an E-mail to: "listserv@xxxxxxxxxxxxxxxxx". Within the body of the text, only write the following:"SIGNOFF AIRLINE".