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(c) Elliott Publishing.

FAA Forecast
Kirby's Korner · December 29, 2000

If you think the recently announced merger of American Airlines and Trans World Airlines represents a change in the American airline industry landscape, you should see what the Federal Aviation Administration is expecting during the next 25 years.

As do all good government bureaucracies, the FAA -- in its report, Long-Range Aerospace Forecasts: Fiscal Years 2015, 2020 and 2025 -- buried the lead. Based on FAA statements and projections -- not on the highlights of its report -- if I was investing in the airline industry of the future, I'd put my money on regional and commuter carriers.

"The extended range and greater speed offered by [larger high-speed turboprop and regional jet] aircraft are expected to expand the market potential for the regional industry and continue to blur the distinction between regional/commuters and the large commercial operators," the FAA said on page eight of a 20-page report.

Later, it predicted an "expanded use of regional jet aircraft," fueled by the trend toward larger yet more efficient small-aircraft reaching as-yet untapped markets.

It makes you think that United Airlines' acquisition target USAirways -- formed from such smaller carriers as Piedmont Airlines and Allegheny Airlines but still my favorite air carrier from the Washington, D.C., market -- was a decade or two before its time. Why become a big guy if the expansion -- and the smart money -- is with the smaller guys?

For us non-investors but simpler travelers, the word is not so good. Expect larger aircraft but the same percentage of passengers filling those seats. Domestic flights will increase from 141 to 149 seats between 1999 and 2025, while international flights will increase from 232 to 265 seats.

No word from the FAA on how many flight attendants we'll see in the coming years, though the agency doesn't seemed worried about the number of pilots.

Speaking of pilots, the number is expected to increase from 640,000 in 1999 to 1 million in 2025 total, including general aviation pilots. Only 309,000 (in 1999) and 464,000 (in 2025) of those are commercial pilots.

The FAA projections are based on a fairly conservative economic evaluation: 2.7 percent annual gross domestic product (GDP) increase; 2.8 annual consumer price index (CPI) increase; a fuel price increase comparable to the CPI; and an interest rate increase of 7 percent a year during the next 25 years.

The FAA is strangely silent on how it expects ticket prices and customer service to evolve in the next 25 years. Without considering passenger improvements, however, the FAA expects U.S. passenger "emplanements" to increase from 575 million in 1999 to 1,370 million in 2025; international "emplanements" will increase from 132 million in 1999 to 469 million in 2025.

As an "emplanement," I promise to let my voice be heard -- and at the time -- about long delays at the check-in counter and at the boarding gate. What other "emplanements" will join me?

(I have a sudden need for a certain bumper sticker. The first person who guesses the sticker wins a free one.)

David Kirby is the Director of Travel Intelligence for iJET Travel Intelligence and was the founding editor of Interactive Travel Report. His column appears on Friday. You can reach him at david@ticked.com.