FAA air traffic forecast predicts more crowding, smaller fare hikes - Expect more flights crowding the nation's busiest airports, FAA says

FAA air traffic forecast predicts more crowding, smaller fare hikes - Expect more flights crowding the nation's busiest airports, FAA says
By John Hilkevitch
Copyright © 2010, Chicago Tribune
Tribune staff reporter
7:21 a.m. CST, March 9, 2010
http://www.chicagotribune.com/business/ct-biz-faa-forecast-air-travel-forecast-mar09,0,7769297.story


Passengers on U.S. airlines will pay relatively small increases in airfares over the next 20 years, but they should expect more flights crowding the nation's busiest airports, including O'Hare International, the Federal Aviation Administration said today.

Travelers hoping to stretch out across an empty seat next to them will likely be out of luck. And the small regional jets that are so unpopular among a significant segment of passengers are here to stay, although the commuter airlines will begin retiring their 50-seat jets in favor of somewhat larger aircraft.

Those are a few snapshots of life at 38,000 feet in the years to come, or at least as far as the FAA can prognosticate based on economic indicators and airline industry trends.

It all can change, without warning, like clear-air turbulence. All bets are off in the event of a terrorist attack, a pandemic disease or various other mayhem, officials said.

The government's revised aviation forecast, which is scheduled for release at a conference in Washington, D.C., on Tuesday, backs away from a prediction made five years ago--before the recession--that more than 1 billion passengers a year will travel by air in 2015.

The FAA now says it will take until 2023 to hit the 1 billion mark, indicating modest annual growth from the 704 million passengers carried in 2009 by U.S. airlines, on both domestic and international flights. Total passengers will rise to 1.21 billion by 2030, the agency said. "There is no rapid recovery in demand predicted, no snapback,'' said Nan Shellabarger, director of aviation policy and plans at the FAA.

Coming off 2009, when U.S. airlines lost $8.1billion, the total number of commercial flights is forecast to decrease 2.7 percent this year, the FAA said. Flight volumes will then grow at an average annual rate of 1.5 percent by 2030, the FAA said.

Passenger volumes will also track a narrow climb, forecast at only a 0.5 percent increase this year and then grow an average of 2.5 percent a year through 2030, the FAA said. The modest increases will "force the industry to be more judicious in adding (flight) capacity than what we have seen in the past,'' Shellabarger said.

Jetliners, which are nearly full on most flights today as the carriers try to prop up airfares, will stay that way, leveling out at 82 percent of all seats occupied on flights over the next 20 years, the FAA said.

The benefit for consumers is that competition among the airlines, particularly the pressure supplied by low-cost carriers such as Southwest Airlines, will "keep prices in check,'' Shellabarger said, adding that new discount airlines are expected to emerge to provide "fare discipline.'' The domestic yield that airlines make, which is based on revenue passenger miles, is projected to be 30 percent lower on average in 2030 than it was in 2009, she said.

While most passengers will continue to fly on the big, mainline airlines, that segment of the industry will grow the slowest over the period covered by the forecast, officials said. The biggest percentage gains will occur on international flights, followed by regional commuter airlines that operate smaller aircraft. Those regional airlines bucked the negative industry trend by turning a profit in 2009, FAA officials noted.

Twenty-nine large hub airports are projected to handle the bulk of the increased flights, growing at an average of 3 percent a year in landings and takeoffs through 2030, the FAA said. It means that to prevent aviation gridlock, the FAA must successfully complete its ambitious transformation of the nation's air-traffic system, dubbed NextGen, to a satellite-based system that replaces the current ground-based radar, officials said.

In addition, airports will need to keep pace by building new runways, passenger terminals and ground transportation improvements such as expanded roadways, officials said.

Yet if the overall slower growth for U.S. air travel is sustained, it could help buy time for the city of Chicago's controversial O'Hare expansion. The $15 billion airfield project is approaching a crossroad, as the major airlines serving O'Hare continue to refuse to help pay for the all-important completion phase, which includes planned runways expected to provide added flight capacity to keep the airport competitive for at least several decades, city aviation officials say.

Mayor Richard Daley said he believes the entire project still can be completed by 2014, with or without the airlines' help. But the mayor's aviation commissioner, Rosemarie Andolino, has declined to say even when the next planned runway will open.

A slow rebound in air traffic, especially if the airlines continue to lose money, will ultimately dictate the course of O'Hare modernization, experts say.