A Model For Forecasting Future Air Travel Demand On The North Atlantic

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ISBN 13 :
Total Pages : 47 pages
Book Rating : 4.:/5 (944 download)

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Download or read book Predicting the Impact of New Technology Aircraft on International Air Transportation Demand written by and published by . This book was released on 1981 with total page 47 pages. Available in PDF, EPUB and Kindle. Book excerpt: Introduction: A desire to see new places, meet different people, and perhaps conduct some business on the side has been an enduring feature of civilization. However, international travel remained largely the province of the adventuresome or the very rich until the advent of modern aircraft. The second half of this century has seen a steady expansion of the jet set as international air travel to and from the United States has risen from 1.1 million passengers (1950) to 32.8 million (1978). While in 1950 half the overseas visitors went by ship, by 1978 the ocean liner customers had decreased to less than five percent of the total travelling public. International travel is still small compared to the domestic air travel market. In 1938, when domestic trunks carried 1.2 million passengers, the airlines had two percent of the 27 billion intercity common carrier passenger miles. In 1950 airlines had increased their share to 14% (of 56 billion) and by 1978 the air share had risen to 84% (of 218 billion). In 1978, 120 million round trips by air were taken in the U.S., compared to 7.8 million U.S. citizen departures for an overseas destination. Both domestic and international traffic statistics clearly surpass growth in population from 1950 to 1980 (152 million to 223 million) and Gross National Product ($534 billion to $1,481 billion, 1972 dollars). What was responsible for this surge of travel? First of all, a reasonably safe and convenient vehicle was needed. "Most of the people who traveled on planes in the early 1930s 'had damn good reason to travel, ' said C.R. Smith [President of American Airlines]. 'Their son fell off a horse, or they had to go to Mayo's --that kind of thing. There wasn't much discretionary about that kind of travel.' "The well-to-do flew. Since flying cost more, air travel was elite travel all through the 1930s. And of these, only the brave flew. A few might take a trip 'to see what it was like.' Others flew for the exaltation earthlings were still discovering in the sky. "But the dominating motive for the 474,000 passenger-flights taken in 1932 was speed. It could not have been anything else, Fortune said, because planes were not as safe as trains, and far less comfortable. One in every 2,200 who travelled that year was involved in a flying accident. Still, in 1932 a $5,000 insurance policy for a plane trip cost $2; for a train journey, twenty-five cents. Wives were still a powerful influence--they swayed men to stay off airplanes after every crash. "Manufacturers' representatives were the backbone of air travel in the 1930s. These were men who had to travel to sell, and the airlines sought their patronage." (Solberg, 1979: 220-221) In the U.S., the DC-3 revolutionized airline travel. On the Atlantic, it was the DC6-B and DC-7 and the introduction of tourist class. When growth in 1951 had fallen to only 8%, it appeared that the limit of people who were willing to pay $711 for a round-trip ticket had been reached, and Pan Am introduced tourist flights--followed shortly by planes that were operated in part as first class and in (large) part as tourist." ... tourist class brought a fantastic upsurge in Atlantic air traffic --up 17% by 1953, 9% more by 1954, then up 19% in 1955, and 20% more in 1956. By 1958 low-fare air travel constituted two-thirds of the North Atlantic business, and Pan Am found that between 67 and 77% of those flying tourist had never been in the air before." (Solberg, 1979: 347-348) In fact, Juan Trippe, Pan Am's president, said later "that the introduction of air coach ranks after Lindbergh's flight and the onset of the jetliner as the third major milestone of airline history." "The importance of that change, which preceded the arrival of jets, was that for the first time the ordinary man began to fly with us," Trippe said. (Solberg, 1979: 345) "The increase in population, in the moneyed class, in overall income played its part in this swift growth ... Tremendous promotion by the airlines and travel agents of economy fares and package vacations also had their effect." (Solberg, 1979: 406) The arrival of the jets, starting with the Boeing 707 -in October 1958 from New York to Paris and ending witwide bodiesbodies, did indeed result in a tremendous increase in travel. At last airplanes were able to fly-over the weather and, combined with dependable fan jet engine power, the reputation of air travel for reliability, comfort, and safety became firmly established. Able to purchase economy class tickets, the public rushed in to fill the seats. By 1972, according to Gallup, half the people in the United States had flown at least once. But even in the early days of jet travel, it was the business traveller who was the dominant passenger. The PANYNJ estimated in 1969 that 5% of the passengers took 40% of all air trips. Across the Atlantic, as late as 1965, the full-fare paying passenger still exceeded the discount and promotional passenger. By 1972 this percentage had decreased to 16%, as the total of all air passengers went from 3 million to 13 million. (The International Air Transport Association [IATA] surveys indicate that 70% of business passengers pay full fare, compared to 20% of vacationers.) Thus, the big upswing in international travel has been in the pleasure travel class, while business travel has increased only slightly in the last decade. The industry is still relatively young and dynamic. Across the North Atlantic, the primary international travel market, going through the air surpassed travelling on water only in 1957. Even in this relatively well established market, trends are subject to rapid change. Growth had been positive from year to year (averaging 18% from 1957 to 1973, with annual increases ranging from 9% to 27%) until 1973, when the total traffic topped out at 14 million passengers. It was 1977 before 1973 levels were reached again. Did the factors that caused growth reverse themselves, or did new factors appear and overwhelm past causes? Do the aggregate numbers hide differing cause and effect relationships? This report is an attempt to explore questions of this nature.