Airlines Are Retrenching, and Alternatives Are Slim

[DET63]

THE coming year will be a time of reckoning in business travel, as airlines reduce service at many airports and prospects fade for practical alternatives to flying, including the long-term promises of high-speed rail. 

Consider the new realities of air travel. Competition is decreasing, fares are rising and airlines are adjusting routes (and charging extra fees) in ruthless calculations to extract the greatest possible revenue per mile flown.

 

Michael Boyd, the president of the consulting company Boyd Group International, sums up the phenomenon succinctly. “The cost of flying airplanes across the sky has eclipsed the ability to support it at many communities,” he said in a recent forecast. In 2012, he predicts, airlines will accelerate the mothballing of smaller 50-seat jets, the workhorses for connecting service between many midsize airports, and even some big ones.

 

[jis]

Airlines are basically going through the motions similar to what the freight railroads went through after the failure of Penn Central resulting in the 4R Act and then Staggers Act. They are basically evolving to a economically sustainable fare level through inventory reduction and reduction/elimination of service to non-sustainable stations unless someone picks up part of the tab. Maybe the equivalent of "Short Line" railroads in the airline business will evolve, if sustainable. Otherwise it will be an opportunity for ground transport. But the fact that ground transport fares are also not quite a long term sustainable levels makes it impossible at present for a major push to take place into the territory vacated. There is some reason to believe that overall people have gotten used to having transportation available to them at non-sustainable costs, and will simply have to get used to somewhat less travel at somewhat higher cost.

BTW, I am curious why a new thread on this subject is needed when another one is already floating around? See: http://discuss.amtraktrains.com/index.php?/topic/45071-airlines-retrenching/page__pid__337012__st__20