Flyers Sour On Air Travel; Koslosky Reacts

June 9, 2008
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GRAND RAPIDS — A new Travel Industry Association survey reveals a high level of frustration among air travelers has caused them to forgo some 41 million trips over the past 12 months at a cost of more than $26 million to the U.S. economy and $9 billion to the airlines.

“The air travel crisis has hit a tipping point. More than 100,000 travelers each day are voting with their wallets by choosing to avoid trips,” stated Roger Dow, president and CEO of TIA. “This landmark research should be a wake-up call to America’s policy leaders that the time for meaningful air system reform is now.”

Kent County Aeronautics Director James Koslosky said fixing the system is going to take three things: the development of a coherent national energy policy; financing reform and modernization of the Federal Aviation Administration; and the return of efficiency and customer service to the aviation security system. All of those changes would have to be made by the federal government.

The federal government has failed to develop a national energy policy, even though the Bush administration has made efforts over the last several years, he said.

“We need to reduce our dependence on oil, particularly foreign oil,” Koslosky said.

“How are we going to do that? What sources of energy are we going to build the future of this country on? That all has to happen, and until it does we’re going to be in crisis mode.”

Koslosky pointed out that the structure and funding mechanisms that support the FAA expired last September, and Congress failed to reauthorize the program to fund the modernization of the air traffic control system and capital improvement of the national airport system. Congress has kept the money flowing through “continuing resolutions.” But those are only temporary. According to Koslosky, the situation is impacting the safety, capacity and customer friendliness of the country’s air traffic control and aviation system. 

“Congress needs to fully reauthorize a new program and funding mechanism for the FAA to move forward over the next five to 10 years so that we can get with what the FAA has designed as a modern satellite air traffic control system,” Koslosky remarked. “That would solve a lot of our air capacity problems.”

To improve the customer experience, the federal government needs to invest heavily in research and development to advance technologies that will enhance the aviation security experience while maintaining the efficiency and accuracy of the system, he added.

The entire travel community took a hit in revenues over the past year as a result of travelers’ cutbacks in flying: Hotels lost nearly $6 billion and restaurants more that $3 billion in revenues. Federal, state and local governments lost more than $4 billion in tax revenue due to reduced spending by air travelers, according to survey results.

Peter D. Hart Research Associates and the Winston Group polled 1,003 air travelers for the survey conducted May 6-13. Among the findings:

** 78 percent of air travelers believe the system is either “broken” or in need of “moderate correction.”

** 62 percent believe the air travel system is deteriorating.

** 33 percent of air travelers (48 percent of frequent flyers) are dissatisfied with the system.

** 39 percent of all air travelers feel their time is not respected in the air travel process; 51 percent of frequent flyers feel the same.

** 28 percent of flyers avoided at least one trip over the past year, or 2.1 trips on average, due to problems in the air travel process.

** 21 million business trips and 29 million leisure trips were avoided in the last 12 months.

The pull-back on the business side is reflected in a recent UBS survey of 80 companies, half of which spend more than $10 million on air travel annually. Some 42 percent of companies polled indicated they are reducing air travel expenses this year, up from 26 percent last fall.

In its report, TIA says the issues the federal government can address are delays, cancellations and inefficient security screening, which are the top three complaints among of flyers. 

TIA plans to host an emergency summit of travel leaders on June 17 in Washington, D.C., and talk to policymakers about what can be done to improve air travel. TIA has also called on major presidential candidates to commit to addressing the issue. Meanwhile, the International Air Transport Association predicts the global airline industry will lose $2.3 billion this year — based on an average oil price of $106.5 per barrel of crude oil.

At IATA’s annual meeting and World Air Transport Summit in Istanbul, Turkey, last week, IATA General Director and CEO Giovanni Bisignani warned that the cost of jet fuel in the United States could run even higher this year — possibly up to $6.1 billion —  given an oil price of $135 per barrel for the remainder of the year. He called on governments, industry partners and labor to address the fuel crisis.

“Airlines are struggling for survival and massive changes are needed,” Bisignani stated. “Governments must stop crazy taxation, change the rules of the game and fix the infrastructure. Labor must understand that jobs disappear if costs don’t come down.”

According to the association, air transport is a global catalyst for $3.5 trillion in business and 32 million jobs.

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