United Airlines CEO: No need for O’Hare expansion, new airport
BY FRAN SPIELMAN City Hall Reporteremail@example.com April 19, 2012 1:30PM
Chicago Mayor Rahm Emanuel and United Continental Chairman Jeff Smisek are shown in a file photo from June 2011. | John H. White~Sun-Times
Updated: May 21, 2012 8:53AM
Mayor Rahm Emanuel’s plan to forge ahead with construction of a fourth new runway at O’Hare Airport ran into turbulence Thursday when the CEO of United Continental Holdings said there’s not enough passenger demand to justify either more “concrete” at O’Hare or a third airport at Peotone.
Jeff Smisek, president and CEO of the mega-company formed after the merger of United and Continental Airlines, made the comments during and after an appearance before the City Club of Chicago Forum.
“The project we have under way [at O’Hare] now is more than sufficient for any reasonable demand we might expect in the near future,” forum sponsor Crain’s Chicago Business quoted Smisek as saying after the speech.
Financially strapped airlines would benefit more from modernizing air traffic control systems than “pouring concrete,” Smisek said.
Pressed on what type of expansion is needed to meet passenger demand at O’Hare, he replied, “None.” He argued that expansion work already completed at O’Hare was “more than sufficient” to meet “any reasonably foreseeable demand.”
Similarly, Smisek told Crain’s there is “no demand” for construction of a third airport at Peotone. He warned that any benefits from U.S. Rep. Jesse Jackson Jr.’s signature project would be “vastly overshadowed” by the damage done to O’Hare.
Emanuel is pushing construction of a fourth new runway — and moving up the timetable for negotiations by one year — to reduce delays by 80 percent, boost capacity by 300,000 passengers a year by 2015, and eliminate the need for a third airport.
“That’s batting [.500] because I agree with him about Peotone,” the mayor joked Thursday.
“Jeff represents United Airlines. I represent the people of the city of Chicago, whose economy depends on a modernized airport. I want to begin those discussions. He says today [demand is] not there. The runway wouldn’t be built today. But, I want to begin that process of discussion about what’s necessary.”
How can the city forge ahead with construction of a fourth new runway that the airlines say they don’t need and cannot afford?
“Because he says we don’t need it now doesn’t mean we won’t need it in the future. He’s making a comment about now. He’s making an observation. But, we will get it done. And the process of starting will happen,” the mayor said.
“Jeff Smisek has a responsibility to United Airlines and its shareholders. I have a responsibility to the people of Chicago who work there whose economy depends on it. . . . I’m gonna see through our responsibility to modernize O’Hare and stay there. That’s the beginning of a process — not the end of a process, I’d like to remind you guys.”
Last year, a $155 million infusion of federal funding and concessions by retiring Mayor Richard M. Daley convinced United and American Airlines to drop their unprecedented lawsuit against the city so construction could resume on $1.17 billion in O’Hare expansion work, including a far south runway that was supposed to be completed last.
Daley agreed that a new western terminal the airlines don’t want would be developed only if demand requires it. City Hall also agreed to negotiate — not dictate — construction of a north runway.
The $2.23 billion in remaining O’Hare projects were to be the subject of a new round of negotiations slated to begin no later than March 1, 2013.