Pre-Summit Optional Events & Workshops

The 2018 International Aviation Forecast Summit

Delivering Insight Even Before It Begins!

As our regular attendees will tell you, the IAFS™ is the most valuable annual event in aviation. That’s because it delivers more data, insight and futurist perspectives. Period.

One of the unique features are the pre-Summit events and Workshops, which in themselves deliver more data, information and insight than any other aviation event in its entirety.

Our attendees are already ahead of the competition even before the start of the Summit itself.

Plan on arriving in Denver early this year. Here’s the current schedule, which is subject to additions and revisions:

The New Air Access Paradigms & The Need For A New Approaches

We’re In The 21st Century – But Air Service Planning Is Still In The 1980s

If you are involved in any way with air service access planning, don’t miss this Workshop.

Chances are your competition will be there.

Using Typewriters Instead of Computers. In a world of instant messaging, Skype meetings across continents, e-mail, and digital communication, the approach to developing air service access in America is the equivalent of using pay phones, snail mail and typewriters to communicate. And to top it all off, the message and the objectives are often completely obsolete.

The Workshop will be based on the key findings new BGI White Paper – The New Air Transportation Paradigm – Time For New Thinking. As with all of our work, it pulls no punches.

America is falling behind in assuring that all regions of the nation have access to and from the global economy. The reason is simple: most “air service development” programs are founded on trying to bring back an air transportation system that’s long since been dead.

Just doing “studies” to “lure” more unnamed airlines is one example of assuming that the 1980s are still in full swing… and these types of programs will leave whole regions behind because they assume an airline industry that no longer exists.

Be Ready To Take Notes & Ask Questions. This is the Workshop that every airport director and air service professional should attend…it outlines how airports and communities need to completely change their entire perspectives on air access, lest they end up cut off from the global economy.

The complete White Paper will be published on August 19, concurrent with this Workshop, and registered Workshop attendees will be provided with a complimentary copy.

More information on the White Paper and what will be covered can be reviewed by clicking here.

_____________________________

Workshop:  Emerging Criticality Of The FBO In Airport Revenue Streams
FBOs will increasingly be an important part of the economic competitive structure at all airports. But they are facing a future that will demand major business changes.

For example, the hurdles to pilot instruction are going up. Not only is the potential demand in the profession being challenged, but the raw costs of entry into the world of leisure and general aviation are going up. The shift from 100LL to diesel technology engines will affect revenue streams. Plus, competition to attract business aviation is going up.

There are a range of open issues that airports need to address in the coming years, such as whether it’s more productive to own or contract out FBO concessions. Projections of changes in fuel sales due to changes in GA and leisure fleet mixes.

For this Workshop, Boyd Group International is excited to bring in Mr. Mike Dye, President of FBOsForSale, an industry expert on the subject of fixed base operators. Mr. Dye has assisted dozens of airports in analyzing and planning the structure of their FBO program, and will be outlining the factors and dynamics that airports will need to consider in the future.

_____________

Workshop: Basics of Air Cargo & Logistics… Potentialities & Opportunities

Shipping goods by air is a very specific communication channel… and like passenger transportation, the basic foundations of air cargo have materially shifted in the past 15 years.

For example, scheduled airline belly cargo capability has been materially diminished by use of smaller jet aircraft, revised security requirements, and the primary focus of attempting to “turn” passenger flights as quickly and labor-efficiently as possible.

Too often, communities are misled into thinking that they can transform the local airport into an air cargo facility. But just having a runway, and even access to a strong highway system are not the main requirements for successful air cargo operations.

But there are new trends in global logistics that point to expansion opportunities – both within the fully-integrated sector as well as traditional air cargo.

This Workshop is designed to deliver and discuss the range of factors that can support air cargo at local airports. We will start with the economic foundations of moving goods by air – which starts with time-efficiency.

We’ll look at other emerging channels that involve air cargo and how airports can “plug in” to them.

This Workshop delivers an outline of what is necessary to determine if an airport has potential for adding air cargo as a revenue stream, either as a hub-truck terminal or direct integrated or non-integrated air service.

_____________

Blockchain – A Coming Disruption To Information Channels

It might be pretty “out there” and esoteric, but so at one time was the concept of the internet.

In the next 3-5 years, blockchain technology and applications are going to alter how data is collected, distributed and analyzed.

Airlines are already looking at using it to eliminate or diminish reliance on retail distribution systems. Think about the challenges this will represent in accessing data that today is readily available in regard to air travel patterns.

That means that how air travel is sold, analyzed and planned will be shifting to different channels. It also means that airport and airline strategies will be developed from new data sources… sources that will be completely separate from channels such as DOT and BTS.

We will be exploring this and the ramifications it has for airports, aviation planners and airlines.

_____________

Workshop: The China Opportunity – Strategies For Communities and Airports

Over $14 billion in industrial and business investment across the US. More than 20 million leisure visitors over the next five years, with an average “spend’ of over $6,000 each.

That’s the scope of the emerging traffic from China. And it’s coming to all parts of the USA. Folks from places like Beijing, Zhengzhou, Tienjin and Shanghai eager to see places like New York State’s Thousand Islands, The River Walk in San Antonio, the Florida Keys, and Little Big Horn… all of America.

Investment? It’s already in full swing… in places like Louisviille and Saginaw and Edgecomb County – from companies with facilities in places like Hefei and Mianyang and Weihai. The opportunities are incredible.

But the advantage will be going to be US cities and airports and businesses that invest now in aggressively posturing for this new investment and travel. It means having an effective China-Welcome program not only locally but in China, too.

This Is More Than Information – It’s A How-To Program. Boyd Group International and its partner China Ni Hao, LLC, have been busy this past year assisting client airports and communities in developing and honing programs to capture more of this incoming business.

Be ready to take notes. This is a functional workshop. We’ll be covering not only how to accommodate Chinese visitors, but also how to build an aggressive and cost-effective digital presence in China.

The Workshop delivers how-to expertise – establishing your professional business-registered WeChat app… managing your message in China on Baidu and other channels. Building your profile by letting the China market know that you understand the importance of things like acceptance of things like UnionPay, Alipay, and WeChat Pay.

We’ll also be outlining how your airport and community can easily develop local China Kits(tm) to assure visitors from China can be seamlessly made to feel welcome.

And we’ll help you avoid some pitfalls… hint: if your current website has an instant Google translate function, disable it as fast as you can… at the Workshop we’ll explain.
___________________

Special! – Get A View of The Supersonic Future!

Saturday, August 18, 2018 – Special Reception – Boom Supersonic

The 55-seat Boom Supersonic airliner is on target for entering service in 2023. It will change the structure of intercontinental travel – materially.

That’s the reason we are excited that Boom has invite Summit attendees are cordially invited to a special reception at the company’s new headquarters and research center, located at Centennial Airport, the company that is building a new airliner that will completely change intercontinental travel.

The reception will include a tour of the company’s new headquarters, including the mock-up of “Baby Boom” – the one-third size concept model, which is scheduled to fly next year.

If you want to see the future,  get to Denver a day early and join us!

The 21st Century Air Access Imperatives

We’re In A Digital World…

… But Air Service Planning Is Stuck In The 1980s

The New Air Access Paradigms & The Need For A New Approaches

We’re In The 21st Century – But Air Service Planning Is Still In The 1980s

This is the Workshop that every airport director would do well to attend… at this Workshop, Boyd Group International will be discussing a new study it is publishing of the air transportation system that’s emerging in America… and how it’s being totally missed – and in some cases intentionally ignored.

In a world of instant messaging, Skype meetings across continents, e-mail, and digital communication, the approach to developing air access in America is the equivalent of using pay phones, snail mail and typewriters to communicate. And to top it all off, the message and the objectives are often completely obsolete.

According to a new comprehensive study by Boyd Group International, the communication channel represented by air transportation has completely changed in structure, economics, consumer preferences and comparative value. But instead of adjusting and optimizing and recognizing these dynamics, the air service planning has recognized none of these fundamental changes.

The 100-page White Paper – The New Air Service Paradigm – Time For New Thinking – pulls no punches.  It’s been developed based on the need to discard current obsolete thinking regarding how air transportation will shape the future.

If the US is to plan for the future, it demands that future realities be accepted, addressed and optimized. But today, that’s not the case.

We can start with how our regulatory system is still firmly rooted in the 1970s… Take just a cursory look.

… The FAA still ranks airports in “hub” categories when most have no such relationship to any activities represented by that term. Nobody is hubbing or connecting in Bangor or Charleston.

… The FAA still thinks there is an independent regional airline system, when it’s been gone for two decades. Go try and book a seat on Air Wisconsin, or SkyWest or Envoy.

… The FAA – and most other forecast sources – still believe that enplanements are the direct result of simple econometric factors. The spikes in enplanements delivered by sudden ULCC entry into several markets have zero to do with GDP or any of the other ancient methodologies used by the FAA.

… FAA data collection is out of date.  But it’s consistent with the computer power that was available when Laugh-In was still on TV.

… O&D and other metrics represent the past, but not the future. Increasingly, there is a complete disconnect between historic airline planning and what is represented by the new mission applications of airliners delivering discretionary consumer products, in addition to “air service.”

… Bogus Studies To “Lure” Airlines To Town. It’s gotten to be the modern version of cargo cults, only they cost a lot more.

Just do a search… the number of small airports getting taken for a ride, with “studies” to find more airlines, when the targets are already as obvious as a blemish on prom night… or, simply not there. And how ’bout those “true market analyses” sold to small airports, showing a “catchment area” only slightly smaller than the Louisiana Purchase.

In the meantime, reality marches on. New fleets are changing airline strategies.

Time to look for regional solutions that fit the realities and economics of air transportation.

It’s time to call these things for what they are. Obsolete fantasy that relates little to the air transportation system of the future.

Not Just Information, But A Planning Document. The White Paper is a working document that goes beyond data and into functional planning changes that airports, community planners and financial institutions need to consider if they want to match the trajectory of change taking place in the air transportation system.

The White Paper will cover the hot button issues, including:

The New Foundations of Air Service... Obsolete Government Data & Related Systems… Government Programs Aimed At Reversing The Calendar..Regionalization of Air Access..Internationalization… New Fleets & New Missions… Developing New Planning Programs.

Again, attendees be ready to take notes. And for a lot of Q&A

Complimentary Copy… IAFS attendees who register and attend this Workshop will receive a complimentary copy of the new study.

The 2018 International Aviation Forecast Summit

Optional Pre-Summit Schedule

As our regular attendees will tell you, the IAFS™ is the most valuable annual event in aviation. That’s because it delivers more data, insight and futurist perspectives. Period.

One of the unique features are the pre-Summit events and Workshops, which in themselves deliver more data, information and insight than any other aviation event in its entirety.

Our attendees are already ahead of the completion even before the start of the Summit itself.

Plan on arriving in Denver early thjs year. Here’s the current schedule:

Special! – Get A View of The Supersonic Future!

Saturday, August 18, 2018 – Special Reception – Boom Supersonic

The 55-seat Boom Supersonic airliner is on target for entering service in 2023. It will change the structure of intercontinental travel – materially.

That’s the reason we are excited that Boom has invite Summit attendees are cordially invited to a special reception at the company’s new headquarters and research center, located at Centennial Airport, the company that is building a new airliner that will completely change intercontinental travel.

The reception will include a tour of the company’s new headquarters, including the mock-up of “Baby Boom” – the one-third size concept model, which is scheduled to fly next year.

If you want to see the future,  get to Denver a day early and join us!

The Sunday Afternoon Workshop Schedule

Session One:  Emerging Criticality Of The FBO In Airport Revenue Streams

FBOs will increasingly be an important part of the economic competitive structure at all airports. But they are facing a future that will demand major business changes.

For example, the hurdles to pilot instruction are going up. Not only is the potential demand in the profession being challenged, but the raw costs of entry into the world of leisure and general aviation are going up. The shift from 100LL to diesel technology engines will affect revenue streams. Plus, competition to attract business aviation is going up.

There are a range of open issues that airports need to address in the coming years, such as whether it’s more productive to own or contract out FBO concessions. Projections of changes in fuel sales due to changes in GA and leisure fleet mixes.

For this Workshop, Boyd Group International is excited to bring in Mr. Mike Dye, President of FBOsForSale, an industry expert on the subject of fixed base operators. Mr. Dye has assisted dozens of airports in analyzing and planning the structure of their FBO program, and will be outlining the factors and dynamics that airports will need to consider in the future.

Session Two: The China Opportunity – Strategies For Communities and Airports

Over $14 billion in industrial and business investment across the US. More than 20 million leisure visitors over the next five years, with an average “spend’ of over $6,000 each.

That’s the scope of the emerging traffic from China. And it’s coming to all parts of the USA. Folks from places like Beijing, Zhengzhou, Tienjin and Shanghai eager to see places like New York State’s Thousand Islands, The River Walk in San Antonio, the Florida Keys, and Little Big Horn… all of America.

Investment? It’s eager investment in places like Louisviille and Saginaw and Edgecomb County – from companies in places like Hefei and Mianyang and Weihai. The opportunities are incredible.

But the advantage will be going to be US cities and airports and businesses that invest now in aggressively posturing for this new investment and travel. It means having an effective China-Welcome program not only locally but in China, too.

Boyd Group International and its partner China Ni Hao, LLC, have been busy this past year assisting client airports and communities in developing and honing programs to capture more of this incoming business.

Be ready to take notes. This is a functional workshop. We’ll be covering not only how to accommodate Chinese visitors, but also how to build an aggressive and cost-effective digital presence in China. Establishing your professional business-registered WeChat app… managing your message in China on Baidu and other channels. Building your profile by letting the China market know that you understand the importance of things like acceptance of things like UnionPay, Alipay, and WeChat Pay.

Aviation DataMiner – Undergoing Updates

Aviation DataMiner Clients:

Aviation DataMiner will be temporarily unavailable for system upgrades starting Thursday, May 3 at 4pm thru 8pm MDT Friday, May 4

During this time, you will not have access to the system. Please plan for this by printing any information, Flight Schedules and Reports, you may need during those down hours.

This Short Period Will Deliver Major System Updates & Enhancements

We regret this short downtime, but we’re upgrading and expanding our server to support additional features of Aviation DataMiner.

We’ll be able to deliver much faster report response time and a faster end user experience. Aviation DataMiner has always been almost 100% zero downtime since its inception, and these new upgrades will continue that track record.

We apologize for any inconvenience this may cause you.

Please call 303-674-2000 or email Bill@aviationdataminer.com if you need assistance. We appreciate your support!

 

Pre-Summit Optional Events & Workshops

The 2018 International Aviation Forecast Summit

Delivering Insight Even Before It Begins!

As our regular attendees will tell you, the IAFS™ is the most valuable annual event in aviation. That’s because it delivers more data, insight and futurist perspectives. Period.

One of the unique features are the pre-Summit events and Workshops, which in themselves deliver more data, information and insight than any other aviation event in its entirety.

Our attendees are already ahead of the competition even before the start of the Summit itself.

Plan on arriving in Denver early this year. Here’s the current schedule, which is subject to additions and revisions:

The New Air Access Paradigms & The Need For A New Approaches

We’re In The 21st Century – But Air Service Planning Is Still In The 1980s

If you are involved in any way with air service access planning, don’t miss this Workshop.

Chances are your competition will be there.

Using Typewriters Instead of Computers. In a world of instant messaging, Skype meetings across continents, e-mail, and digital communication, the approach to developing air service access in America is the equivalent of using pay phones, snail mail and typewriters to communicate. And to top it all off, the message and the objectives are often completely obsolete.

The Workshop will be based on the key findings new BGI White Paper – The New Air Transportation Paradigm – Time For New Thinking. As with all of our work, it pulls no punches.

America is falling behind in assuring that all regions of the nation have access to and from the global economy. The reason is simple: most “air service development” programs are founded on trying to bring back an air transportation system that’s long since been dead.

Just doing “studies” to “lure” more unnamed airlines is one example of assuming that the 1980s are still in full swing… and these types of programs will leave whole regions behind because they assume an airline industry that no longer exists.

Be Ready To Take Notes & Ask Questions. This is the Workshop that every airport director and air service professional should attend…it outlines how airports and communities need to completely change their entire perspectives on air access, lest they end up cut off from the global economy.

The complete White Paper will be published on August 19, concurrent with this Workshop, and registered Workshop attendees will be provided with a complimentary copy.

More information on the White Paper and what will be covered can be reviewed by clicking here.

_____________________________

Workshop:  Emerging Criticality Of The FBO In Airport Revenue Streams
FBOs will increasingly be an important part of the economic competitive structure at all airports. But they are facing a future that will demand major business changes.

For example, the hurdles to pilot instruction are going up. Not only is the potential demand in the profession being challenged, but the raw costs of entry into the world of leisure and general aviation are going up. The shift from 100LL to diesel technology engines will affect revenue streams. Plus, competition to attract business aviation is going up.

There are a range of open issues that airports need to address in the coming years, such as whether it’s more productive to own or contract out FBO concessions. Projections of changes in fuel sales due to changes in GA and leisure fleet mixes.

For this Workshop, Boyd Group International is excited to bring in Mr. Mike Dye, President of FBOsForSale, an industry expert on the subject of fixed base operators. Mr. Dye has assisted dozens of airports in analyzing and planning the structure of their FBO program, and will be outlining the factors and dynamics that airports will need to consider in the future.

_____________

Workshop: Basics of Air Cargo & Logistics… Potentialities & Opportunities

Shipping goods by air is a very specific communication channel… and like passenger transportation, the basic foundations of air cargo have materially shifted in the past 15 years.

For example, scheduled airline belly cargo capability has been materially diminished by use of smaller jet aircraft, revised security requirements, and the primary focus of attempting to “turn” passenger flights as quickly and labor-efficiently as possible.

Too often, communities are misled into thinking that they can transform the local airport into an air cargo facility. But just having a runway, and even access to a strong highway system are not the main requirements for successful air cargo operations.

But there are new trends in global logistics that point to expansion opportunities – both within the fully-integrated sector as well as traditional air cargo.

This Workshop is designed to deliver and discuss the range of factors that can support air cargo at local airports. We will start with the economic foundations of moving goods by air – which starts with time-efficiency.

We’ll look at other emerging channels that involve air cargo and how airports can “plug in” to them.

This Workshop delivers an outline of what is necessary to determine if an airport has potential for adding air cargo as a revenue stream, either as a hub-truck terminal or direct integrated or non-integrated air service.

_____________

Blockchain – A Coming Disruption To Information Channels

It might be pretty “out there” and esoteric, but so at one time was the concept of the internet.

In the next 3-5 years, blockchain technology and applications are going to alter how data is collected, distributed and analyzed.

Airlines are already looking at using it to eliminate or diminish reliance on retail distribution systems. Think about the challenges this will represent in accessing data that today is readily available in regard to air travel patterns.

That means that how air travel is sold, analyzed and planned will be shifting to different channels. It also means that airport and airline strategies will be developed from new data sources… sources that will be completely separate from channels such as DOT and BTS.

We will be exploring this and the ramifications it has for airports, aviation planners and airlines.

_____________

Workshop: The China Opportunity – Strategies For Communities and Airports

Over $14 billion in industrial and business investment across the US. More than 20 million leisure visitors over the next five years, with an average “spend’ of over $6,000 each.

That’s the scope of the emerging traffic from China. And it’s coming to all parts of the USA. Folks from places like Beijing, Zhengzhou, Tienjin and Shanghai eager to see places like New York State’s Thousand Islands, The River Walk in San Antonio, the Florida Keys, and Little Big Horn… all of America.

Investment? It’s already in full swing… in places like Louisviille and Saginaw and Edgecomb County – from companies with facilities in places like Hefei and Mianyang and Weihai. The opportunities are incredible.

But the advantage will be going to be US cities and airports and businesses that invest now in aggressively posturing for this new investment and travel. It means having an effective China-Welcome program not only locally but in China, too.

This Is More Than Information – It’s A How-To Program. Boyd Group International and its partner China Ni Hao, LLC, have been busy this past year assisting client airports and communities in developing and honing programs to capture more of this incoming business.

Be ready to take notes. This is a functional workshop. We’ll be covering not only how to accommodate Chinese visitors, but also how to build an aggressive and cost-effective digital presence in China.

The Workshop delivers how-to expertise – establishing your professional business-registered WeChat app… managing your message in China on Baidu and other channels. Building your profile by letting the China market know that you understand the importance of things like acceptance of things like UnionPay, Alipay, and WeChat Pay.

We’ll also be outlining how your airport and community can easily develop local China Kits(tm) to assure visitors from China can be seamlessly made to feel welcome.

And we’ll help you avoid some pitfalls… hint: if your current website has an instant Google translate function, disable it as fast as you can… at the Workshop we’ll explain.
___________________

Special! – Get A View of The Supersonic Future!

Saturday, August 18, 2018 – Special Reception – Boom Supersonic

The 55-seat Boom Supersonic airliner is on target for entering service in 2023. It will change the structure of intercontinental travel – materially.

That’s the reason we are excited that Boom has invite Summit attendees are cordially invited to a special reception at the company’s new headquarters and research center, located at Centennial Airport, the company that is building a new airliner that will completely change intercontinental travel.

The reception will include a tour of the company’s new headquarters, including the mock-up of “Baby Boom” – the one-third size concept model, which is scheduled to fly next year.

If you want to see the future,  get to Denver a day early and join us!

The 21st Century Air Access Imperatives

We’re In A Digital World…

… But Air Service Planning Is Stuck In The 1980s

The New Air Access Paradigms & The Need For A New Approaches

We’re In The 21st Century – But Air Service Planning Is Still In The 1980s

This is the Workshop that every airport director would do well to attend… at this Workshop, Boyd Group International will be discussing a new study it is publishing of the air transportation system that’s emerging in America… and how it’s being totally missed – and in some cases intentionally ignored.

In a world of instant messaging, Skype meetings across continents, e-mail, and digital communication, the approach to developing air access in America is the equivalent of using pay phones, snail mail and typewriters to communicate. And to top it all off, the message and the objectives are often completely obsolete.

According to a new comprehensive study by Boyd Group International, the communication channel represented by air transportation has completely changed in structure, economics, consumer preferences and comparative value. But instead of adjusting and optimizing and recognizing these dynamics, the air service planning has recognized none of these fundamental changes.

The 100-page White Paper – The New Air Service Paradigm – Time For New Thinking – pulls no punches.  It’s been developed based on the need to discard current obsolete thinking regarding how air transportation will shape the future.

If the US is to plan for the future, it demands that future realities be accepted, addressed and optimized. But today, that’s not the case.

We can start with how our regulatory system is still firmly rooted in the 1970s… Take just a cursory look.

… The FAA still ranks airports in “hub” categories when most have no such relationship to any activities represented by that term. Nobody is hubbing or connecting in Bangor or Charleston.

… The FAA still thinks there is an independent regional airline system, when it’s been gone for two decades. Go try and book a seat on Air Wisconsin, or SkyWest or Envoy.

… The FAA – and most other forecast sources – still believe that enplanements are the direct result of simple econometric factors. The spikes in enplanements delivered by sudden ULCC entry into several markets have zero to do with GDP or any of the other ancient methodologies used by the FAA.

… FAA data collection is out of date.  But it’s consistent with the computer power that was available when Laugh-In was still on TV.

… O&D and other metrics represent the past, but not the future. Increasingly, there is a complete disconnect between historic airline planning and what is represented by the new mission applications of airliners delivering discretionary consumer products, in addition to “air service.”

… Bogus Studies To “Lure” Airlines To Town. It’s gotten to be the modern version of cargo cults, only they cost a lot more.

Just do a search… the number of small airports getting taken for a ride, with “studies” to find more airlines, when the targets are already as obvious as a blemish on prom night… or, simply not there. And how ’bout those “true market analyses” sold to small airports, showing a “catchment area” only slightly smaller than the Louisiana Purchase.

In the meantime, reality marches on. New fleets are changing airline strategies.

Time to look for regional solutions that fit the realities and economics of air transportation.

It’s time to call these things for what they are. Obsolete fantasy that relates little to the air transportation system of the future.

Not Just Information, But A Planning Document. The White Paper is a working document that goes beyond data and into functional planning changes that airports, community planners and financial institutions need to consider if they want to match the trajectory of change taking place in the air transportation system.

The White Paper will cover the hot button issues, including:

The New Foundations of Air Service... Obsolete Government Data & Related Systems… Government Programs Aimed At Reversing The Calendar..Regionalization of Air Access..Internationalization… New Fleets & New Missions… Developing New Planning Programs.

Again, attendees be ready to take notes. And for a lot of Q&A

Complimentary Copy… IAFS attendees who register and attend this Workshop will receive a complimentary copy of the new study.

The 2018 International Aviation Forecast Summit

Optional Pre-Summit Schedule

As our regular attendees will tell you, the IAFS™ is the most valuable annual event in aviation. That’s because it delivers more data, insight and futurist perspectives. Period.

One of the unique features are the pre-Summit events and Workshops, which in themselves deliver more data, information and insight than any other aviation event in its entirety.

Our attendees are already ahead of the completion even before the start of the Summit itself.

Plan on arriving in Denver early thjs year. Here’s the current schedule:

Special! – Get A View of The Supersonic Future!

Saturday, August 18, 2018 – Special Reception – Boom Supersonic

The 55-seat Boom Supersonic airliner is on target for entering service in 2023. It will change the structure of intercontinental travel – materially.

That’s the reason we are excited that Boom has invite Summit attendees are cordially invited to a special reception at the company’s new headquarters and research center, located at Centennial Airport, the company that is building a new airliner that will completely change intercontinental travel.

The reception will include a tour of the company’s new headquarters, including the mock-up of “Baby Boom” – the one-third size concept model, which is scheduled to fly next year.

If you want to see the future,  get to Denver a day early and join us!

The Sunday Afternoon Workshop Schedule

Session One:  Emerging Criticality Of The FBO In Airport Revenue Streams

FBOs will increasingly be an important part of the economic competitive structure at all airports. But they are facing a future that will demand major business changes.

For example, the hurdles to pilot instruction are going up. Not only is the potential demand in the profession being challenged, but the raw costs of entry into the world of leisure and general aviation are going up. The shift from 100LL to diesel technology engines will affect revenue streams. Plus, competition to attract business aviation is going up.

There are a range of open issues that airports need to address in the coming years, such as whether it’s more productive to own or contract out FBO concessions. Projections of changes in fuel sales due to changes in GA and leisure fleet mixes.

For this Workshop, Boyd Group International is excited to bring in Mr. Mike Dye, President of FBOsForSale, an industry expert on the subject of fixed base operators. Mr. Dye has assisted dozens of airports in analyzing and planning the structure of their FBO program, and will be outlining the factors and dynamics that airports will need to consider in the future.

Session Two: The China Opportunity – Strategies For Communities and Airports

Over $14 billion in industrial and business investment across the US. More than 20 million leisure visitors over the next five years, with an average “spend’ of over $6,000 each.

That’s the scope of the emerging traffic from China. And it’s coming to all parts of the USA. Folks from places like Beijing, Zhengzhou, Tienjin and Shanghai eager to see places like New York State’s Thousand Islands, The River Walk in San Antonio, the Florida Keys, and Little Big Horn… all of America.

Investment? It’s eager investment in places like Louisviille and Saginaw and Edgecomb County – from companies in places like Hefei and Mianyang and Weihai. The opportunities are incredible.

But the advantage will be going to be US cities and airports and businesses that invest now in aggressively posturing for this new investment and travel. It means having an effective China-Welcome program not only locally but in China, too.

Boyd Group International and its partner China Ni Hao, LLC, have been busy this past year assisting client airports and communities in developing and honing programs to capture more of this incoming business.

Be ready to take notes. This is a functional workshop. We’ll be covering not only how to accommodate Chinese visitors, but also how to build an aggressive and cost-effective digital presence in China. Establishing your professional business-registered WeChat app… managing your message in China on Baidu and other channels. Building your profile by letting the China market know that you understand the importance of things like acceptance of things like UnionPay, Alipay, and WeChat Pay.

Monday Update Archives – 2nd Half 2017

Monday Update Archives…

___________________

December 25, 2017….

The Update Will Be Posted Tuesday, January 2…

We’ll Be Covering 2018 Aviation Predictions….

In The Meantime, Merry Christmas &

Happy Holidays From The Staff at Boyd Group International!

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Update: December 18, 2017

Before We Start…

Congratulations To Missoula…  in gaining first-ever nonstop flights to American’s global hub at Dallas-Ft. Worth. The schedule is now loaded.

Boyd Group International is proud to have worked with the community in capturing this new access for Montana. This follows our earlier work with Bozeman in gaining DFW/AA service.

In 2018, Boyd Group International will be assisting communities in pursuing new-concept approaches to air access… and in using our advanced forecast capability to identify changes in the air transportation system that will affect future air service potential.

In the future, ferreting out historical travel data via massive “market studies” will be of rapidly-declining value in matching air access within the fundamentally-evolving air transportation system.

We’ll be talking more about this in the 2018 Aviation Forecast Predictions, to be issued January 2.

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The Atlanta Outage Fiasco

One More Wake-Up Call…

Security Is Protecting The Operation of Our Systems. But We’re Still Looking For Liquids & Gels

Atlanta was completely shut down for several hours on Sunday, December 17, 2017.

Dark. Nothing worked. Stone age with dead computer terminals. The fallout was not only that the ATL airport was down, but the entire air transportation system was affected.

The cause: an electrical failure across the entire facility, caused reportedly by a (relatively) small fire that knocked out some switching equipment, as well as the redundant systems that just happened to be located adjacent to the faulty equipment.

The whole enchilada at the nation’s number one passenger airport went cold. And nobody had a clear plan on how to remediate the situation in regard to the thousands of people inside the terminal. ATL was simply unplugged.

The total loss of electrical power, and insufficient redundancy is serious enough. The real wake-up call is that there was no clear contingency plan to handle the disaster.

But it’s not an Atlanta issue. Airports are complex operations, and in the current global environment, they face threats that were never anticipated before 9/11. But those threats are here now. The potentiality of thousands of people being trapped inside an airport represents a security and safety issue, regardless of the cause.

It’s another indication that when it comes to clear and anticipative security and safety planning, the US is still in the 1950s. Yes, a complete electrical failure is an incredibly difficult event to deal with. But that is the very nature of security. It’s anticipating the worst, and in the event it does happen, having contingency and remediation plans. These cannot address all potentialities, but they can assure that at least there are pro-active planning options that have been reviewed.

At best, we have security “silos,” but no comprehensive national program to anticipate threats to our infrastructure…. and “threats” go way beyond crazy people strapping on explosives, or trying to screen for people carrying more than 3 ounces of Grecian Formula through screening points.

The Fake News Is Rampant Regarding Aviation Security. No, we are not more secure than before 9/11. Forget the inevitable stupid, suck-up stories on the 6PM news from the usual-suspect network correspondents who want to posture themselves as experts because they got a statement from some PR hack at Homeland Security. Forget the dumb comments from the very top honchos at the TSA – most are just political appointees, not security experts.

Let’s say it again: we are not more secure than before 9/11. The ATL experience proves it. Lots of eyewash. Lots of political posturing. Billions spent. But when the lights went out in Georgia’s biggest airport, it was anybody’s guess on what to do.

Zero Contingency Planning. “Pandemonium” was the most repeated term in regard to what people in the airport experienced. Anything operated with electricity was dead as a dodo. Vending machines kaput. Nothing doing at concessions because the point-of-sale computers may as well have been lumps of lead. Electrically-operated exit doors not working. Airplanes stuck for hours, just yards away from the terminal, because jet bridges didn’t work.

Obviously, there was no contingency plan whatsoever. Pandemonium is the opposite of security when an event such as this takes place. Pandemonium is a threat to safety.

Security Is About Protecting Our Way of Life. “Security” – among other things,  is to protect the safety and functionality of facilities. That’s a light year or two from what we saw at Atlanta. But don’t expect any of the usual suspects in the Fifth Estate to tumble to what the ATL blackout represents.

And as for the dragons at the top of the travel and aviation alphabet groups in Washington, expect no comment whatsoever.

ATL Is Just One Example. Sure, nobody got shot. Nothing got blown up. It supposedly just cancelled and delayed hundreds of flights. But it also left the entire airport without juice – and any semi-sober high school dropout could figure out what that meant in regard to consumer safety and security.

In the context of assuring the viability of the US air transportation system, this was a material security failure. No excuses. This very clearly shows that in the event of an actual terror-related event, thousands of people in the terminal would be threatened.

Let’s stop this charade. There is no comprehensive, pro-active AVSEC in place across the US.

Relax. The Experts Tell Us All Is Well. But, please don’t be concerned. The very people who should be doing a conga line into the Homeland Security Administrator’s office are doing nothing.

We’d again point out that there were zero – none, zip, nada, mei-you – negative comments a few weeks ago from the main Beltway alphabet groups when it was reported that airport screener tests has as high as an 80% failure rate. But they sure came out with kudos to the TSA for smooth operations over the Thanksgiving week-end.

Pathetic.

We Have Completely Forgotten 9/11. Before 9/11, the FAA leadership under Administrator Jane Garvey (then in charge of aviation security) were warned time and again of security vulnerability at US airports. Red Team Inspectors consistently reported major security shortfalls. Actually, a May 2001 report warned of the possibility of multiple hijackings at Boston Logan Airport

They were ignored – not just by the FAA, but by political mannequins like Senator Kerry and Rep. Markey – both of Massachusetts.

Then, when the 9/11 Commission produced its dishonest political conclusions, the testimony of Red Team Inspectors was completely left out. Not important, according to the life forms running this corrupt embarrassment.

Funny, the network correspondents who tell us that we’re oh-so-safe, don’t cover any of this – past or present.

Learning? The good news is that this ATL event gives a new perspective on hardening airport security. Airports can learn from this event and can now begin to plan to anticipate what two days ago was unthinkable. It’s a wake-up call.

Unfortunately, the folks in Homeland Security inside the Beltway are still sound asleep.

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Update: December 11, 2017

The 2018 International Aviation Forecast Summit

It’s on! August 19-21, in Denver!

Last year, we set records.

This year, we’re going to do it again. In addition to delivering insights and business intelligence that go way beyond any other event, we’re also going to hear from the aviation leaders that will be shaping the future.

For more information on the IAFS™ just click here. Register today for super early-bird rates.

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Rearview Mirror Forecasting.

Trendy. Safe. And Economically-Dangerous

Take a look back 25 years.

The structure and dimensions of the air transportation system are materially different today.

And in 2025, the nature, structure, and utility of air travel will again be nothing like we see today.

But then take a look at most aviation trend forecasts – it makes no difference whether they’re formal documents from federal sources, or just occasional rambling babble from some media types. They almost always take what they see in the rearview mirror of history, and just project it into the future.

Sloppy forecasting. What shapes the future are disruptive events and disruptive technologies… and disruptive thinking that dares to step out of the mainstream.

At the 2016 Boyd Group International Aviation Forecast Summit, we showcased a new entrant to the aircraft manufacturing sector – Boom Technology.

Boom outlined their new concept 50-55 seat 2.2 Mach airliner, capable of doing New York to London in just over three hours. The plan was to have an aircraft that was aimed directly at the core revenue streams of international travel – i.e., the front-cabin business-class segment.

The concept is that if the business-class customer could pay the same fare to get to the destination in half the time, then that all those perks on the 777 – that lovely duvet, 180-degree seat, and the ability to lounge about drinking fine champagnes during the pre-arrival breakfast, etc., would not be competitive.

The All-Knowing Rearview Mirror Says It Can’t Work. Naturally, the inhabitants of Ludditesville – consultants, media, etc., immediately came back in a chorus about how the Concorde failed, or how “there’s no engine,” or how major airlines would never consider such a silly concept.

The only thing they focused on was the word “supersonic” – and then proceeded to trumpet how such speeds were a near-impossible goal for a commercial airliner. And the size – just around 50 seats – could never be financially-viable. “Everybody knows” that you need volume to make long haul flights work.

In 99.9% of the cases, none of these back-alley gurus bothered to look beyond their main forecasting tool, which is the rearview mirror. Just about none considered the market and revenue applications the Boom aircraft represented.

No, the verdict was in before the jury was empaneled. Summary judgment: this is not going to work. Yeah, supposedly Richard Branson had 10 options for Virgin Atlantic, but this is never going to be anything that a mainstream airline will touch with a barge pole.

Get Ready For Some Changes of Tune. Last week, Japan Airlines entered into an agreement to invest $10 million into Boom Technologies and option 20 of their aircraft.

JAL obviously sees that they could dominate much of the Pacific Rim front cabin traffic sector with this airliner.

Instead of 50 business class seats on a (comparatively) lumbering 777 between Tokyo and Singapore, or Manila, or Hong Kong, or Taipei, or Bangkok, or Kuala Lumpur, those seats could be on Boom airliners, and in the process making the competition look like cave-dwellers.

The point is that this new Boom airliner represents a new and very disruptive set of challenges to intercontinental airlines. For example, it’s going to change the distribution of travel between airliners, and will represent challenges in re-structuring cabin real estate on existing-generation airliners.

The potential variations are enormous in regard to the service products that these carriers will offer.

… Could there be a de-bundled business class for these slower airliners?

… Does this spell trouble for WOW or Norwegian, allowing incumbents to suddenly have lots of new low-frills capacity?

… What does this represent for demand for new twin-aisle airliners, what with lots of new capacity already being created as premium seats migrate to Boom airplanes, leaving lots of additional capacity on current wide-body fleets?

… What to watch for in the coming months are the effects of raised eyebrows at JAL’s competitors, and what actions they may take in regard to Boom.

Hint: join us at the Boyd Group International Aviation Forecast Summit, and we’ll be exploring these and other dynamics.

One thing is certain: the intercontinental air travel mix will be very different in ten years from what it is today.

The Japan Airlines order will start to change the tune of the “experts” – bank on it, particularly as other airline commitments come into play. It’s easy to “forecast” after things like this take place.

Boyd Group International is proud to have assisted Boom in the development of global demand forecasts for the new airliner. The Japan Airlines event buttresses our findings.

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Update: December 4, 2017

To Start, Some Air Access News…

We’re excited to note that our client Bangor International has gained year-round AA service to Charlotte, as well as week-end American flights to Chicago.

Also, American will be operating from Traverse City Cherry Capital Airport to the Big Apple this summer, with week-end nonstops to LaGuardia. These join the seasonal TVC-DFW flights that were facilitated by a SCASD grant crafted by Boyd Group International.

Stand by. More to come…

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Congratulations, McCarran. 

One Year As The First Functional China-Welcome Gateway

On December 2, 2016, the first nonstop flight from Beijing arrived at Las Vegas.

A notable event, one year ago.

But even more notable was that this was the implementation of the  first truly in-depth, functional and comprehensive China-Welcome™ program at any US airport.

It was also notable to the arriving passengers. A year later, it remains so.

From the welcome they receive in Mandarin at the  jetway from a team of uniformed 欢迎大使 – Huanying (Welcome) Ambassadors – all the way through the customs processing, right through to ground transportation, these important customers are supported every step of the way into Las Vegas, and back to China, too.

Signage and wayfinding in Chinese is deployed at all communication touch points, and the Ambassadors are ready to assist these important visitors as they processed into the US.

At the FIS, they’re guided by new signage in simplified Chinese characters. The unfortunate fact is that at most US gateways, even the official US Customs signage is still in “traditional” Chinese – and that hasn’t been used in mainland China since Chiang Kai-shek skedaddled out of town. It borders on insulting to visitors. That’s not the case at McCarran.

More Than Fluff Greetings – Mining Important Strategic Planning Info, Too. The program is not only a marketing success, but a strategic one as well.

At each departure, circulating in the lounge area, the Ambassadors politely ask passengers if they would share information on their trip, including for Chinese citizens where they are going and what part of China they are from. The process conveys the perception that the airport recognizes the value of their business.

While anecdotal, the information is also very valuable in collecting basic demographic information on this emerging international visitor sector. .

LAS – Leader In Innovative China Outreach. In addition to this local program, LAS has also implemented an aggressive digital presence in China.

McCarran stands out in having the most comprehensive WeChat app of any US airport. WeChat is the most widely used – and most flexible – mobile app in China, with over 500 million Chinese subscribers.

The McCarran WeChat app puts the airport literally into the pockets of thousands of Chinese travelers before they leave China. And once at LAS, the app serves as a navigational as well as a digital forum for airport concessionaires to offer Chinese menus and special promotional offerings.

It’s a tool not only for visitors on flights directly from China, but for the over 340,000 Chinese who pass through the airport on other flight routings. The QR code to download the app is also conveniently provided in signage across the airport, including on the inter-terminal transit trains.

In fact, the sophistication of the McCarran WeChat app is the equal of those at Beijing Capital and Shanghai Pudong airports. That’s natural – it was designed by the same team, a team that’s now associated with Boyd Group International.

There’s Veneer China-Prep, And Then There’s China-Welcome™. A lot of US airports will claim they are “China ready,” but Las Vegas McCarran is the only one to have a truly functional and pro-active outreach that goes beyond a couple of signs, a Mandarin speaker on hand, and “cultural” awareness programs.

At LAS, Chinese visitors are proactively made to feel that the airport respects and values their business. The uncertainty and anxiety of Mandarin-only speakers are aggressively addressed.

That is not the case at most other US airports. To be blunt, Mars probably has better Chinese wayfinding and welcome than at most US international gateways.

Interested In Gaining More of This Traffic? We’re Ready. With an expected 26 million visitors expected from the Middle Kingdom in the next five years, it is aggressive airports such as McCarran that have the eye of the new Chinese airlines seeking to enter the US.

Boyd Group International is proud to have worked with McCarran in establishing their China-Welcome™ program. And across the US, we’re working with a number of airports – of all sizes – in crafting programs tailored to their specific China opportunity.

If your airport or community is interested in developing a China-Welcome™ program, let us know. From full-featured systems such as at LAS, down to informational brochures available and ready, we can craft a program that puts your facility ahead of the competition.

Yes, Some Airports Will Claim, Our Website Already Has A Chinese Translation. Yikes! If your local website has one of those automated google-type “translations” into foreign languages, including Chinese, we’d suggest you stop right now – run, don’t walk – and get it off your site as soon as possible.

Those machine translations are insultingly inept and make the airport look stupid to Chinese visitors. They randomly translate words in raw form, with the result being laughable and embarrassing. One we found to translate “stay with us in XXX” to “leave yourself stationary.” And that was typical of the entire site. Lots of web designers think this is the latest advancement. It’s simply sloppy work.

Instead, let us assist in implementing a web strategy, from a simple professional Chinese tab on your existing site all the way up to hosting a full-featured website in China, created in Chinese, not translated from English..

For more information on the range of cost-effective China-Welcome™ channels we offer, click here to the China Ni Hao website.

In the meantime, congratulations to Las Vegas McCarran.

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Update: November 27, 2017

TSA Fails 80% of Screening Tests…

Silence From The DC Cognoscenti

It was reported a couple weeks ago that tests of screening at airports across the nation fell flat in detecting dangerous objects.

The failure rate was estimated to be near 80%.

One might think that this would have the aviation and travel industries all frothy and indignant. Heck, some of these folks have claimed that so much as a ban on a couple of countries which have poor internal security and which generate near zip tourists to the US is a giant threat to our travel economy.

One might think that the news that our airport security stinks would be a major factor in deterring visitors to the USA, and there would be calls for some immediate remediation.

Nope.

Not a peep from any of the alphabet organizations inside the Beltway. Remember the labor union that a few weeks ago so loudly denounced the plan at PIT to let non-ticketed people in to the main terminal, calling it a threat to security? Not a word from them, either.

Think About How Incompetent The Rest of The TSA Programs May Be. Here’s a fun thought. If the simple stuff like identifying pointy objects isn’t being done, it’s a lead pipe cinch that the more sophisticated and difficult security aspects – such as perimeter and AOA screening, not to mention complete threat-identification and event-mitigation programs – are also being ignored. You can make book on it.

There were hopes that the Trump Administration would clean house at the Department of Homeland Security and the TSA. Apparently, not. Or, at least not yet.

Take The Easy Way Out. Blame The Folks In The Blue Shirts. Take a look at the media coverage… virtually all of it discusses how the front-line screeners supposedly aren’t doing their jobs. It’s their sloppy work, according to the veneer “experts” and zipper-brained network reporters.

Wrong. The actual slop in work product is at the media outlets that spew out this shallow-fact garbage.  What they generally duck from is any criticism of the people at the top of the TSA – the ones who are planning and running the show.

Here’s a fact that’s being missed: the people in the blue shirts at US airports are doing an excellent job.

That’s because they are doing exactly what the management of the TSA directs them to do. They are working within the rules, oversight, supervision and direction of TSA management.

The only real problem with the front line at the TSA is that they are stuck  working for people at the top who are simply unaccountable, unqualified and inept. A 96% failure rate two years ago, and now an 80% flop score illuminates that it’s not the front line that’s got the problem. It’s the kiddie-table expertise at the very top of the TSA that needs to be canned.

Unfortunately, however, these people are not in line for any criticism from the media.  Any major outlet that would legitimately cover this clown show knows that they might not again get direct access to the TSA Administrator or the head of Homeland Security. Those suck-up oh-so-cordial B-roll walk-and-talk pieces with the TSA administrator are great for the 6PM news.

If there’s an 80% failure rate, it means that the system is faulty and the management at the top are incompetent and the entire front offices of this gong show need to go.

Say it again… the system is the failure, not the people staring at semi-effective baggage screening devices all day, or trying to nicely explain that, no, grandpa, your Swiss Army knife can’t go through.

But, it seems that the Washington fraternity is holding tight, circling the wagons around the clowns who are  mismanaging airport security.

Having an airport security system that doesn’t work is apparently not a big deal to them, compared to making sure they have the connections they need at the top.

That may seem a bit rough. But this is pretty much the same situation as in 2001, when FAA Red Team inspectors tried to warn the people at the top about bad aviation security.

Politics and the need for access to “pull” took priority then, too.

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And Finally…

Thanks to the many folks who commented on last week’s discussion of how a lot of traditional “air service development” schemes simply mislead small communities into the planning weeds.

As we’ve pointed out to our clients, all channels of communication have fundamentally changed in the past 20 years, and that includes the applications and effectiveness of air transportation. Most traditional ASD programs simply pander to small communities’ natural desire for scheduled flights at the local airport, instead of candidly outlining new realities.

To be sure, that’s probably not a popular position in a lot of circles.

But, then again, maybe it’s a lot more understood than it may appear, judging from the positive input we’ve received from professionals across the industry spectrum.

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Update: November 20, 2017

Keeping America Connected To The Globe…

Accept It… It’s An Inter-Modal Future. 

American Airlines is dropping flights to Laughlin-Bullhead City.

It sounds like a minor adjustment in a big airline system. But it’s a lot more than that: it’s indicative of the new realities of air service access for small communities, and is just the latest example of how small community air service access needs to move beyond 1980’s planning.

Initiated last year and supported by a federal Small Community Air Service development grant plus a reported $250K in local marketing, the flights to the American Airlines hub at Phoenix clocked in at something like a 44% load factor.

There was nothing wrong with the AA Eagle service. The two segments had great connections to AA flights at Phoenix. But it failed miserably.

Actually, this shouldn’t be a surprise. The service was simply not competitive for consumers, even though they were the only scheduled flights at the airport. The fact is that consumers had other scheduled air service options that were qualitatively and quantitatively vastly superior. The difference was that these options are at Las Vegas – 90 minutes away.

This is a poster child for the need to rethink all air access planning at small communities. Here’s a hard question for small communities: do you want “flights” at the local airport, or do you want air access. The two are not always the same.

Yeahbutt, We Need It. It’s natural for communities to believe that service at the local airport is an economic necessity. But that’s sometimes neither possible, nor beneficial. The shame is that most current “air service development” approaches pushed onto small airports focus on keeping small communities locked into outdated planning and obsolete approaches that don’t have a snowball’s chance in Miami of connecting them to global economy. In fact, a lot of this thinking is based on an airline system that no longer exists.

Reality: air transportation isn’t economically possible or “consumer-possible” at many small community local airports. This is anathema to even suggest to the local mayor, but it is a reality that needs to be dealt with in economic planning. In many cases, it is a dead-end in regard to accomplishing the main reason for scheduled air service, which is having access that consumers can use from – yes, from – the rest of the globe

It’s About Access. Not Just Local Flights. It’s not that there isn’t traffic generated at Laughlin-Bullhead City. The hard fact – ignored in most small-community ASD “studies” – was failure to understand that just having flights at the local airport often isn’t necessarily more consumer-convenient than other options.

In this case, the 90 minute drive to Las Vegas, which hosts nonstop flights around the globe, is far more valuable than low-frequency local flights that connect to a single airline system at Phoenix. The total travel time for consumers to most destinations was likely far less at Las Vegas, even with the drive to McCarran International. And the flight options at LAS are galaxies beyond the AA hub at PHX.

(In fact, Las Vegas McCarran International has more nonstops to more cities than any other US airport.)

Point: local connective air service at small communities can be successful only if it is superior to other consumer options. It isn’t possible at Laughlin-Bullhead City. It isn’t at places like Topeka, Naples, or Youngstown, either. It’s the nature of airline business and airline economics. Consumers in these places are fortunate – they have great air service access… it’s just can’t be viable from the local airport in contrast to other, better options. Even with a longer drive to the gateway airport.

It’s called total air access time. But it’s one dynamic that’s steadfastly left out of most of the air service development studies delivered to small airports.

Always Sunshine Results. Funny. It seems that just about every “study” done for very small communities to “find more airlines” always comes back with a positive conclusion, but one that assures that more consulting work will be needed… like maybe a “diversion study,” or a “catchment analysis,” or other efforts.

But in most cases, the actual airline – the one or ones that are potential viable targets – are usually not mentioned. It’s implied that there are lots of airlines out there – and connectivity levels from the rest of the globe aren’t really mentioned much.

It’s hard to find any of these projects that ever even hint that there may not be “another airline” even vaguely interested, or that there are better consumer options that may be lethal to potential service at the local airport. Or that illuminate the potential for air access strategies other than non-viable flights at the local aerodrome.

Keeping The Blinders On & Hoping For The Best. Usually, the only factors focused on in most traditional “air service development” programs are things like the “needs” of the community, or the glowing results of a recent unscientific online survey, or a grand “catchment study,” accessorized by lots of expensive point-of-sale data that isn’t particularly comprehensive, but looks great on that heat map illustration. And, usually, no identification of whether the community fits into any existing airline’s strategy.

Air transportation is all about better travel options. In many cases, the service that a small community can support can’t meet that standard.

Again, the future is in assuring air access – and often the local airport won’t be in the play. Yet most ASD schemes simply keep communities focused on the past, instead of crafting plans that adjust to the new air transportation economic realities.

In 2018, we’ll see fleet changes in the major network airline systems that will accelerate regionalization of air access.

And this will accelerate the need for regions to re-think air access strategies. Traditional ASD studies will only divert energies from finding regional solutions.

Bank on it.

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Update – November 13, 2017

Starting Out This Week…

“US Airports Would Do Well To Become China-Friendly”

Travel Weekly Acknowledges BGI China-Welcome Programs

Boyd Group International and its partner, China Ni Hao, LLC., have been working with a number of airports and communities in developing tailored programs that will put them ahead of the competition in gaining a larger share of the burgeoning Chinese leisure traffic and Chinese business investment in the USA.

Posturing to have a higher profile in the China sector will be important for communities of all sizes, and BGI/CNH are at the forefront of providing professional and very functional outreach systems.

From China Kits for episodic visitors from the Middle Kingdom, to China-Welcome programs for airports, through full-function digital and website presence in China, we have the expertise to make sure that when Chinese visitors and businesses look to come to America, our clients are ahead of the pack.

By the way, don’t get too comfortable if your website has a machine Google translation… you look really foolish to Chinese visitors and web designers who include this aren’t doing you any favors.

We are honored that Travel Weekly just posted an article on this subject.

Take a look.

And for more information on how we can get your airport and community in front of Chinese consumers and businesses, check out www.ChinaNiHao.com.

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Aviation DataMiner Takes A Look:

Cuba: Vapor Demand Materializes

Sun Country Latest To 86 Cuba Plans.

Last December, Boyd Group International’s trend predictions for 2017 included the forecast that US airlines would rapidly find out that all the travel industry’s panting and drooling about the huge “pent up demand” for Cuba travel would look pretty amateurish by the fourth quarter of the year.

A few months ago, BGI also noted that any increase in restrictions on Cuba access coming from the Trump administration would be a perfect smoke screen excuse for carriers to cut back and save face… not to mention saving a lot of money from not running semi-empty airliners to places that most US consumers have never heard of.

And that is exactly what’s taken place. The traffic demand to Cuba is a dud.

And what traffic that has been developed is likely to be mostly the kind of group tours that were in place before Obama went to Havana and basically apologized to the  dictator who’s running the place.

Standby For More Exits. Spirit, Frontier, Silver, Spirit, and now Sun Country have taken a pass on Cuba.

American has cut way back, and can be expected to do more in the first half of 2018. A 56% load factor, CLT-HAV isn’t going to cut it.

Southwest experienced ghastly load factors in markets like FLL-Matanzas, and FLL-Santa Clara.

Masking this, a couple of carriers, according to sunshine reports in the media, have requested more rights to Cuba.  The stories conveniently leave out that they’re asking for Havana and mostly from SE Florida – which, looking at the load factors so far, is still very iffy. But nobody is lining up to add service to Camaguey or Cienfuegos.

No Infrastructure. No freedom. No Economy – What Does That Say About Air Travel?. It’s not a surprise. Ray Charles could have seen this one coming.

As a vacation destination for US consumers, Missoula and Bangor and Santa Fe have more value to offer than Cuba… actually, a whole lot more.

And now, right on the fake news cue, some in the media are implying that these airline cuts are due to the Trump Administration’s revisions, making it harder for individuals to visit the Worker’s Paradise 90 miles off our coast, and making it difficult for US companies to sell lots of products to the eager Cuban economy.

You bet… we’re told that the “people to people” thing was a sure winner… bringing citizens together and building new friendships between our two countries. We were told that the Cuban economy was going to be a demand bonanza for US goods.

Somebody lost chain of custody of these folks’ last drug test.

People-to-people? Super… if they could talk freely, the Cubans could tell us all about how they have no right to vote, that they have shortages of key goods, their pay rates are at the subsistence level, and that they can’t travel freely out of the country.

Fact is that we can talk to Cuban citizens all we want. They can’t talk to their own government, so only people incredibly naïve could buy into that dishonest “people-outreach” garbage lauded by the last administration.

Oh, yeah. All that great business opportunity? Except for a hotel deal or two, or a highly-publicized deal where some company will supply hand-tractors to the primitive farming system in Cuba, there is no business base.

And, by the way, the US embargo has nothing to do with this. Cuba can buy whatever they want from the rest of the world. Their economic system has trashed the place to the point where they can’t.

Worse, most of the companies that do exist are run by the same Cuban military that makes sure there is no dissent among the populace. Message: doing business with them won’t help the Cuban people, but just enrich the thugs running the Cuban military.

These are just a couple of points that won’t be on the 6PM news. Not politically-correct, see.

But they are core reasons that any major level of US-Cuba air travel demand simply does not exist.

Airlines Should Be Thanking Trump. For the airline industry, however, all the media drivel about new restrictions killing off demand (that was never there in the first place), is a super excuse to get out of a lot of cash-burning flying,

In point of fact, the hard truth is that whatever Trump may have done or might do in regard to Cuba policy, it is a total non sequitur in regard to the traffic levels that airlines have experienced long before such actions were taken.

Other than Havana, most of the traffic is nonsense.

And even there, plan on more US-HAV markets dropped like a baby grand out of the 8th floor in the coming months.

Let’s Look At Some Numbers. As for Sun Country, they had the rights to fly from MSP to Santa Clara and Matanzas/Varadero.

Facts be known, most folks in the Twin Cities wouldn’t know these places from a medianoche sandwich.

So, accessing Aviation DataMiner, let’s take a look at the stellar demand from the US to these points through the end of April:

Point: if American and Southwest can’t make these markets a go from SE Florida – where over 60% of Cuban-Americans are located, the chances of Sun Country Airlines getting walk-up, individual demand  or even group movements, from MSP are right up there with winning the national lottery on Mars.

Here are a few other stellar examples of how the Cuba market is tanking… and, again, it’s likely that the yields  on these flights are not warming the hearts of airline CFOs, and the costs of doing business at Cuban airports probably are no bargain, either.

And, then there’s Havana….

Better load factors, but not anywhere near system averages, and you can take it to your bookie that the yields are close to bargain-basement and the costs of Cuba operations are in the stratosphere.

Bottom line: Until there are changes inside the cleptocratic Cuban government, and until  Cubans are allowed more freedom than inmates at a minimum security prison, and until the business base (such as it is) gets out of the control of the totalitarian Cuban military, US airlines can just sit and wait.

Trend Forecasts…The Advantage For Our Clients. We’d again point out that BGI forecasts outlined this situation in a comprehensive study in 2009, and an updated one two years ago. Somehow, we didn’t see any of the rest of the players in the aviation consulting business come out on this subject.

Also, our work was not well accepted by the travel industry, which by and large totally ignored most of the hard realities of Cuba, and instead trumpeted how Cuba was the Next Big Thing.

Now that the Cuban vapor hole is  as obvious as Osama Bin-Laden showing up at a Bar Mitzvah, watch for the “reports” and studies coming out in early 2018 from the Usual Suspects in the consulting sector, “predicting” a decline in expected performance of US-Cuba  markets.

It’s always safe to predict what’s already happened.

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Update – November 6, 2017

Airline Marketing Alliances… Nothing’s In Stone

Last week, China Southern let it be known that they’re looking at moving out of the SkyTeam alliance, in light of American’s minority share purchase in the Guangzhou-based airline.

With the opening of the huge new Daxing airport in Beijing in 2019, China Southern is expected to have a substantial connecting operation – which would compete with the one expected to be established by co-SkyTeam member China Eastern.

So, plan on China Southern joining the oneworld alliance, which will finally give American a true Chinese airline partner, above and beyond what’s already in place with Hong Kong based Cathay Pacific. This will open China-US traffic access to new levels.

Cathay’s oneworld membership, however, may not be one to make book on the next time you’re in ‘Vegas. Seems that Qatar Airlines, recently, has bought a nearly 10% share of Cathay, which does have some presence for code-sharing with AA to points in SE Asia. Nevertheless, a China Southern code-share at PEK outshines by far what AA could lose from CX potentially pulling out of oneworld.

And speaking of Middle Eastern carriers Etihad has announced that they are dropping service to DFW, because of, they say, AA’s decision to cancel their  code-share agreement.

The point is whether yields made any sense. Film at 11.

(Note: thanks to the folks who corrected our mixing Etihad and Qatar in the initial posting!)

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The “Pilot Shortage” – Choking Air Service?

It is a clear fact that airlines are having difficulty attracting candidates to the pilot profession. The need to accumulate a now-required 1,500 hours of experience is a huge financial barrier to attracting candidates for the profession.

But, according to the dogma behind the rule, this will make us all safe from the tragedy of flight 3407, which crashed on approach to Buffalo in 2009.

Declare Anyone Who Disagrees A Heretic. News stories have illuminated that a proposed appointee to the NTSB has gone on record that the 1,500 hour rule, passed  after the Continental/Colgan crash, does little by itself to avoid what happened that night.

The media response was like lightening – this guy wants to cut back on safety! Facts not necessary, by the way.  Wider discussion not needed.

At the congressional hearings to vet this appointee, several  politicians grabbed their soap boxes to denounce this candidate’s refusal to accept the wisdom of the rule.

He correctly pointed out, however, that the NTSB findings faulted training and oversight at the operator, not pilot time.

He also had the audacity to point out that this 1,500 hour rule – which is so zealously defended as the lynchpin of safety by certain lobbyist sectors and in the me-too media – wouldn’t have kept either of the incompetent pilots out of that cockpit.

The fact is that they both had more than this supposed sliver-bullet minimum. The fact is, then, that this sacred rule isn’t a solution to the issues that caused loss of life.

Do Not Even Suggest Alternative Solutions. Here’s the bottom line: open discussion and exchange of ideas on this subject are closed.

“The science has been decided,” as it were, and anybody who dares suggest that the pilot time rules put into effect  need to be reviewed, is attacked and pilloried like heretics  during the Inquisition who didn’t fully agree with the Pope.

It’s actually unsafe to even suggest alternatives.

Airport Input?  That brings us to the airport industry. Airports are losing air service access due to this rule – which, again for clarification, would not have prevented the Buffalo accident – then maybe the airport industry may want to take a more aggressive stand. To be fair, there are efforts, but they are drown out by cheap politicians playing to emotion, and dishonest media that postures the 1,500 rule as a not-to-mess-with rule.

Maybe a call for additional scrutiny of what can be done to keep skies safe and air transportation un-choked is now in order. And, indeed, consistently responding to these political mediocrities and special interests that their love for an arbitrary rule, instead of comprehensively improved training and oversight, it not making the skies any safer.

There are solutions that can be explored in regard to increasing safety.

But the 1,500 rule by itself doesn’t eliminate the causes of 3407.

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Update – October 30, 2017

Southwest – A Snapshot of Fundamental Changes

We thought it might be interesting to take a look at where Southwest is today v the year 2000.

Using Aviation DataMiner, we compared the key metrics for the top 10 WN airports in 1Q 2017 v those in 1Q 2000.

Very revealing – it’s an airline that, other than its core focus on customer service, isn’t much the same as it was back then.

Note that two of the 2017 top ten – Denver and Orlando – weren’t on the Southwest top ten route map in 2000. They are now lynchpins in Southwest’s traffic flows.

The percent change in key metrics indicate an airline with a route system fundamentally different than in 2000…

The real metric of interest is the change in average passenger trip at each city, showing how the reach of Southwest has expanded. It’s not a short haul airline, despite some veneer media lore. In fact, the average passenger LOH has gone from 546 miles to just over 900 between 2000 and 2017.

This also indicates the criticality of connecting traffic for Southwest. Point-to-point is important, but its revenue streams are increasingly reliant on connecting passengers across its operations at MDW, PHX, HOU, STL, etc.

Just One Example of The Insights Delivered By Aviation DataMiner. In aviation planning, access to hard, analytical data such as this is critical – and that means going beyond what comes off of raw BTS websites. Aviation DataMiner delivers the analytical firepower that gives industry professionals the competitive edge.

With hundreds of immediate reports -analyzing fares, yields, traffic flows, capacity, load factors, route performance and forecasts, Aviation DataMiner outshines any other source.

For a free trial, click here. We can have you on line literally in minutes!

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And, as a reminder…

It’s Now On The DOT Docket

The 2017 Small Community Air Service Development Grant Program

The docket is issued… not much change from last year… $10 million allocated. The same qualifications and filing requirements.

If your airport and community are interested in exploring whether a SCASD grant is the right approach, we’ve put together a free comprehensive guide that explains the program, and candidly discusses the pros and cons of whether to apply.

Unlike other consultants, BGI is very careful to work with our clients to assure that they aren’t chasing dry air service holes with an application. The program since 2002 has been riddled with applications that, even if successful, led nowhere in gaining new air access.

So, we’d be delighted to talk regarding the potential of a SCASD.

While we’ve won more grant dollars under this program than any other consulting firm, in the past four years we have been very careful regarding accepting these projects. We focus on pursuing results for our clients.

Click here to request the SCASD Guide… we’ll get it right off to you. Then give us a call.

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The Update

Proposed ATC “Reform” & The Mob Approach To Management Change

Anybody remember Paul Castellano?

He was the Don of one of the most powerful “families” in New York.

Nevertheless, he got whacked by his underlings in a high-profile hit as he arrived at a Midtown restaurant in 1986.

It seems they disagreed regarding management issues, but had no disagreements about the underpinnings of the family activities themselves.

It resulted in a  management change in the front offices of the family. But at the end of the day, the rest of the family continued to do business just as it did before Big Paul met his untimely demise. Just new faces at the top.

“Reform” – Whacking The FAA… But Keeping The System. What took place long ago on New York’s eastside is pretty much along the lines of the current hoopla around whether to “reform” and privatize the air traffic control system, or leave it in the clumsy control of a bungling government agency.

That’s what’s on the table. Change of management. Not a change of fundamental direction. Not implementation of a system of accountability for results. No cleaning of house. Not any discussion of whether the failure to achieve material improvements in airline schedule performance may be due to the NextGen program itself.

The reform crowd, not to put too fine a point on it, only wants to clip the current ATC Don – the FAA – and take over the “family” – the air traffic control system.

And like the capos who wanted Big Paul out, the ATC reform folks have no quarrel with the core business activities of the current FAA Don. They intend to keep the current staff, structure and modus operandi that’s there already, i.e., the system that doesn’t produce results.

They just want control – in this case, that means control of the NextGen program.

Flaw: Confusing “Reform” With Results. As a factual matter, neither side in the ATC squabble have any quarrel with what the FAA is actually doing… they have no criticism whatsoever on NextGen. it’s just the management style they disagree with.

Nothing personal – it’s strictly business. And will lead strictly to non-results, either way it plays out.

Sound & Fury Signifying The Wrong Direction. The noise surrounding whether the air traffic control system should be “reformed” or left in the blundering cloak of the FAA gets louder – and more irrelevant – with every press release from either side.

The “reform” crowd all contend that putting the ATC system under a semi-private structure will result in a new modernized system. These are sometimes accessorized with un-supported and frankly fruitcake predictions that “reform” will massively cut airline delays by double-digit amounts.

The anti-reformists are warning that privatizing ATC will be devastating to the air transportation system, as they claim it will turn it over to the evil airlines, who’ll certainly use to make more money at the expense of the consumer.

A key tenet of the anti-reformists is that privatization will result in small communities losing air service – a contention completely concocted and being nothing more than a desperation fear-grenade… not much different from the clowns that claim an end to EAS will close airports.

The point in all this is that neither side has a clue.

Neither side has a problem with the ATC NextGen “family business” – which is a fraudulent scandal that both want to continue to worship and retain.

Neither side has promulgated any fundamental changes in ATC modernization. Nobody has dared mention that NextGen has a rap sheet of failure longer than I-95. Nobody has suggested structural changes that address the bungling at the FAA for the last 30 years.

Both sides agree, apparently, that NextGen is the answer… they only differ on how it should be managed… or, mismanaged.

Now, It’s In The Airlines’ Court. What is becoming more and more clear is that the path to improving air transportation efficiency does not lie entirely within the FAA or the ATC system. It’s now the responsibility of the airlines themselves.

It’s clear that ATC – which is intended to maintain separation of aircraft – isn’t a solution to the entire range of issues and dynamics that have resulted in virtually no material improvement in “on-time” performance in the last decade.

GAO studies on ATC (the majority of which, by the way, do not blame funding for the mess the FAA has created with NextGen)  have noted that the actual causes of airline off-schedule operations are not fully understood. In some cases, the ATC system is the cause. In others, airport congestion. In others, sheer dimbulb operations management by airlines.

But one thing is now certain: this hype about “reform” fixing the system is based on bogus assumptions and PR doggerel. The anti-reform reactionists are even less credible – they don’t want to change a thing.

This is not to say that ATC modernization should not be taken away from the klutz-masters at the FAA. It just illuminates that whether “reformed” or remaining in the status-quo, there are no ATC-based solutions on the horizon.

So, rest assured that nothing is going to change. Both sides want to retain the problem, under different management systems.

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Update October 16, 2017

Selective  Security Outrage

One prime reason that, truth be known, AVSEC is still wallowing in a bureaucratic quagmire is that most of the aviation industry is loath to criticize the system.

Or, worse, mesmerized with the PR that comes out of the Department of Homeland Security.

The latest example is the strong objections of one flight attendant union to Pittsburgh International opening its shopping mall terminal to access from non-ticketed visitors.

The righteous outrage is well-scripted. This move by PIT will reduce security and threaten the flying public, is the claim.

But this same oh-so-concerned union never made any loud noises whatsoever when it was found two years ago that screener tests were being flunked at a 96% rate. Or, when other such information comes to light about the sloppy management of the TSA.

Whether or not PIT’s new policy will denigrate security is not the issue here.

The issue is that there are lots of aviation-related  and travel-related organizations whose credibility should be zero.

Taking on an airport is easy.

But daring to criticize the incompetents at the top of the TSA, well, that’s another story.

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Update October 9, 2017

Airline Financial Analyses  – Consider With Caution

Southwest just reported September results.  We came across a very interesting review of the carrier’s performance.

A couple of key measures declined Y-O-Y, such as load factor and revenue passenger miles, leading this source to declare that the airline’s performance as “disappointing.”

The report wallowed around, decrying a decline in RPMs of 4.5%, a lower load factor and other danger signs that were shown as prima face proof that Southwest was in decline in September.

Summarizing the veneer understanding of the airline business, this financial report declared…

“…Load factor (the percentage of seats filled by passengers) decreased 250 basis points (bps) to 81.7% in September. The key metric fell since the contraction in traffic was more than that in capacity leading to empty planes…”

Yikes.

Read that again, dig the comments within the context of airline industry metrics, and consider this comes from a source that postures itself as a reliable reference for investors.

The first red flag is the term “250 bps” to describe the decline in load factor. Nobody awake, sober and with even a high-school knowledge of the airline business uses “basis points” to measure changes in load factor. That’s a financial term, not one used in airline data.

Then, there is the contention that’s lethal to the report’s credibility. “… leading to empty planes…”

Misleading, unprofessional, and stupid.

That can only be described as a sure sign the writer might not be expert in the airline industry, particularly where the airline had a nearly 82% system load factor.

The uninformed reader gets the impression from this posturing “expert” that WN routinely flew empty flights, which was not the case. It does not say that the average passenger load, system-wide, was 2.9 fewer passengers on a fleet with an average of 149 seats per flight.

It does not reveal that in September the average WN flight had just about 122 passengers on board v 125 last year. That’s not empty.

It does not say that a few more seats on average were unoccupied. They didn’t say “empty seats.”

It does no explanation of any shifts in the WN route system that could explain the change in these measures.

No running from it. The report states  clearly that Southwest was flying “empty planes” due to the decline in load factor.

That’s fake news. To the consumer, “empty”means nobody on the plane.

If one is taking investment advice, a whole lot more informational precision might be expected.

On the basis of this, the source advises investors to dump their Southwest stock.

A Couple of Airline Metrics Not Considered. Now, Southwest is a big boy airline and can certainly deal with this half-baked financial reporting for themselves.

But there have been changes in the WN fleet and route system over the past year, and there are no danger signs regarding out-of-control route expansion, over capacity, or consumer issues.

We’d maybe point out that just reading SEC documents and Form-41 data, without full analysis and understanding of what’s behind them, or of the airline’s known and expected strategic direction, is a veneer way to make determinations on whether the airline’s future is going in the right direction.

There are a lot of strong airline analysts out there. But…

Caveat Emptor.

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Update October 2, 2017

Travel Industry: Where’s The Leadership?

Here’s the brief but accurate outline of what has become the political football of choice.

The Trump Administration is planning  travel restrictions on several countries, all of which have been determined to be places with inadequate counter-terrorism programs. Eight of these have populations that are predominantly Muslim.

Now, the number of travelers from these places is miniscule, and has very little impact on the US travel industry. It’s strictly based on security issues. As far as the US as a destination goes, this should be a plus to attract more visitors.

Get Political. Make It Something It’s Not. Unless, of course, the program can be accused of being a wider scheme to keep foreigners across the board out of the US. It is a  crackpot and dishonest attempt to shift truth into political fantasy. But that defines a lot of what goes on within a lot of political entities.

Now, because there are Muslim countries involved, the ACLU and other groups have declared the program as being one of racial discrimination, and by association, anybody who does not oppose these new restrictions is a racist. So, just because the implication of racism has been made, the safe path is to not call it for what it is: garbage

The fact that these countries – which do not represent anywhere near  the majority of the global Muslim population –  have been determined not to have adequate anti-terrorism programs in place, is left out in the pathetic brown-shirt-like protests about “hate” and America being a land open to all. Including, it seems anybody who may want to come in.

This notwithstanding all of the Islamic terror over the past year, and the fact that at last we have an administration that recognizes the threat.

And, contrary to what the ACLU and their political supporters are spouting, and the media is parroting like a cheap tape recorder, this not a blanket ban on Muslims. To imply that is a lie. It’s as stupid as if the ACLU sued ISIS, claiming they discriminate against hiring Christians.

Travel Industry Organizations: Closet Supporters of The Fantasy? Now, enter the travel industry. Instead of working to counter these dishonest missives, they are side-stepping them, and don’t have the gumption to bring out the whole picture.

The message between the lines from these travel organizations: These restrictions are silly and unneeded and damaging. No attempt to investigate regarding whether there are security issues involved.

One group has urged the president to re-affirm to the nation that these actions are not meant to harm travel demand to the USA. Like, if the full facts were reported, or even illuminated by these travel organizations, that comment would be completely unneeded. They should be getting the full story out. They aren’t doing that.

But apparently these Washington travel groups buy into the dishonest party line that it’s all about dimbulb racial discrimination. They don’t want to tell the whole story – which is their job, by the way.

Create The “Message” – And Then Claim That It’s “World Opinion.” Another travel group has warned that these actions are sending messages to the world that foreigners are not welcome in the USA. The only “message” is the one being sent by these organizations themselves.

The “message” is coming directly from the travel industry – it’s an inside job.

Having the US restrict travel from a few places where there are indications of lack of proper security should be something that they would embrace as a positive factor to visit the USA.

Instead, they are tacitly (at the least) providing support to the dishonest sectors that are claiming these restrictions are racially-based, and are just smoke screens to discriminate against Muslims. That’s a complete failure in leadership on the part of the US travel industry.

Do a search. Not one travel industry leader has come out to even outline the reasons for the restrictions, but instead have cowardly tried to spit out milquetoast comments that assure that they get no criticism from places like the ACLU or others in Washington who put politics ahead of national security.

Shameful.

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Year 2018 Aviation Outlook

The 2018 Trend Outlook.

Looking Beyond The Consensus.

The 2018 Boyd Group International Aviation Trend Outlook is now available.

In the document, we cover several areas where evolutionary and episodic change can be expected in the coming year and beyond.

TitlePage2018650Boyd Group International has a track record of forecasting trends that are missed by other sources. The reason is simple: we do not accept at face value the “consensus” or what may be described as “ambient thinking.”

Those terms are just alternative descriptions of making sure that there are no risks taken and there’s no potential of challenging the entrenched thinking of the status-quo.

For more than three decades, Boyd Group International has built a track record of assisting clients from across aviation and across the globe in identifying new future opportunities. In doing so, we don’t go by the book. We write the future book.

Below are some basic subject synopses of the 2018 predictions and trend projections in this year’s BGI Aviation Trend Outlook. To view and download the complete document, just click here, and we’ll get it to you ASAP.

If you have any questions or input regarding this document, please let us know.

IAFS 350And, of course, if you need futurist aviation research, forecasting or consulting, we stand ready to assist.We would point out that many of the trends outlined herein are indicative of the scope and structure that will be delivered at the 23rd International Aviation Forecast Summit, August 19-23, 2018, hosted by Denver International Airport.

CEOs and senior executives from across the industry and across the globe will be here to openly discuss the future. No boring “panels.” Instead, direct discussion and exploration of the future from those who are shaping it.

To reserve your space and for more information: www.AviationForecastSummit.com Special New Year registration rates are now offered.

2018: Looking To A Strong, But Global 2018

Traffic Trend: Fundamental Growth… Plus More Impulse-Buy Capacity

Let’s put it on the line.

The hand-wringing from some in the financial world about airlines adding too much capacity in 2018 is strictly Chicken Little. Capacity discipline is firmly in control.

Look For @ 4% More Seats, But Less Than 3.5% More Flying. As of January 1, US carriers are scheduling a 3.9% increase in capacity for the first six months, compared to the same time period in 2017. Most of the reporting on this implies that carriers are simply adding flights on top of existing ones.

In some cases that is accurate, based on very high load factors, and particularly in cases where the carriers’ connecting hubs experience “hub-choke” – when there is demand for more feed through the hub, but the connecting banks to major destinations are functionally fully-booked.

But in other cases, much of the increase in capacity is based on network carriers (American, Delta, United and Southwest) adding new markets – particularly trans-border and international.[1]

Also adding to the capacity picture is the expansion of the “parallel airline universe” – ULCCs expanding and offering fares that transcend ambient market “demand” and establish the travel product as an alternative application of discretionary dollars.

Wildcard: In any case, the recent reduction in the corporate tax rate, could result in carriers adding more capacity to meet newly-generated demand in the fourth quarter of 2018.

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2018 Trend: Hub-Choke Increasingly To Affect Route Planning

For airlines, experiencing very high load factors in key major markets to and from the carrier’s hubsite operations are generally positive.

However, this dynamic also represents some traffic spill – where consumers in, say, Abilene find it difficult to find space on the connecting flights from DFW. In some cases, carriers will use sophisticated analytical systems to build highest and best use scheduling – in effect weeding out feed markets that are the least revenue-productive for limited hub capacity. Expect more of this in the coming year.

Enter New Fleets:  With the phase out of what turboprops are left at American and United, and upgrade to increasingly cost-inefficient but larger 50-seat jets, more planning pressure will be but on network carriers to again review which small-airport routes  make the most sense in light of the major routes to which they feed being at or near functional capacity.

Now add in the new dynamic of AA, DL and UA creating new “basic fare” buckets, which are applied mainly to retain and attract more nonstop O&D traffic in key major (read:  nonstop hub) markets. This will further put a strain on the availability of capacity for smaller communities that depend on connect access at the hubsite.

The result is that, in many small-community feed markets, a load factor of 65% to the airline’s hubsite is functionally a “full” flight. There simply are no more seats available through the connecting hub.

This will continue to be an issue for smaller communities dependent on air access through a fully-booked hubsite operation. In many cases, these airports will be more than able to support the additional capacity to the connecting hub. Some, however, may be facing a potential pull-down in service.

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2018 Trend: Small Community Air Access: Fantasy Is No Longer An Option

Many small communities need to come to grips with the three major and largely irreversible trends that are shaping air access from the globe.

  • Hub-Choke. This we cover above, but what should not be ignored is that there is often no alternative airline to enter the market from their connecting hub. When the distance to the UA/IAH hubsite represents more cost and more airplane time than the revenues that the market can generate, no amount of “market studies” will create more airlines or change economic realities.
  • Eclipsing Costs. The emerging “floor” for feed fleets to network systems is the 50-seat jet. It is being retired – slowly, now that fuel costs are where they are – but they do represent a higher revenue bar for communities to meet.
  • Consumer Preferences & Alternatives. Increasingly, within the emerging economics of airline operations, the type of scheduled air service that some smaller communities can support at the local airport is DOA. That’s because in many cases such service is consumer-inferior, less time-efficient, and actually less convenient than an hour’s drive (or even in some cases, even a 90-minute) drive to an alternative airport where the population (or an airline’s connecting hub) can support much wider flight access. This is another dynamic that no amount to civic hubris or more expensive and misleading “studies” will change. Regionalization of air access is an emerging reality in some parts of the US. It should be recognized and embraced, because the air transportation system isn’t returning to the 1980s.

That’s because in many cases such service  is consumer-inferior, less time-efficient, and actually less convenient than an hour’s drive (or even in some cases, even a 90-minute) drive to an alternative airport where the population (or an airline’s connecting hub) can support much wider flight access.

Regionalization of air access is an emerging reality in some parts of the US. It should be recognized and embraced, because the air transportation system isn’t returning to the 1980s.

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2018 Trend: More EU Nonstops From The Heartland

As was first outlined at the 2013 International Aviation Forecast Summit, key non-hubsite major US airports are prime candidates for EU carriers to add to their global systems.

For network carrier system such as British, Air France and Lufthansa, the traffic feed to their hubs in Europe from large US cities such as New Orleans, Indianapolis, Nashville, etc., can be very attractive.

The key factors for this service are generally, 1) a strong local population base, 2) very strong installed base of internationally-focused industry, and 3) – most important – strong highway network access from a wide population region.

This latter factor is important, as a nonstop London flight from, for example, New Orleans, is more convenient for folks to drive to from Gulfport, compared to the complexity of making a flight connection over IAH or ATL.

In addition, the massive expansion of impulse service to the Continent by WOW and Norwegian will open even more access. In these cases, however, the US point will be more of a destination, as opposed to a generator of feed traffic.

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Potential Trend: China Moving To Acquire Foreign Aircraft Manufacturers

Boyd Group International research in the China aviation market indicates that we may see very significant and elsewhere-unforecasted moves by China to expand its global presence.

In particular, there is a very real potential for Chinese entities to make a move to acquire either Bombardier or, more likely, Embraer. We believe the recent Boeing outreach to Embraer is at least partially a pre-emptive move.

Point: China is intent on becoming a major player in the airliner sector. Its current indigenous platforms are not going to be able to accomplish this. Therefore, an acquisition of Embraer or Bombardier (or, possibly another player we won’t mention right now) is not out of the question.

The potential shifts in relationships among suppliers, and the impact on the commercial direction of the US airframe and powerplant sectors would be very far-reaching in broadening the presence of Chinese business in America.

From that perspective, BGI predicts that more US airports and venues will be moving to become more welcoming to the Chinese leisure and business visitor.  To be sure, just about every US gateway airport claims it is ready for these travelers… but in most cases, Mars has better wayfinding and welcome than US facilities.

It goes beyond having a Mandarin speaker on-site, and it goes beyond veneer things like ice water in restaurants. We point out that the poor misled airports that have been sold an “international translation” website feature that includes Chinese are simply making themselves look really amateur and silly to the Chinese consumer. The translations are abominable.

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Fuel & Labor Issues

It is understandable for financial analysts to be concerned regarding the potential effects of changes in these two key cost factors on airline bottom lines,

From a rational perspective, these are important to watch, and it is near-certain that in the next 18 months, labor costs will impact the bottom line at a number of carriers. However, given the expected robust demand, there are no thunderstorms on the horizon for 2018.

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These just scratch the surface of what to expect in 2018…There’s a lot more to explore.

To view and download the complete 2018 Aviation Trend Outlook, just click here, and we’ll get it to you ASAP.

Updates

TSA Fails 80% of Screening Tests…

Silence From The DC Cognoscenti

It was reported a couple weeks ago that tests of screening at airports across the nation fell flat in detecting dangerous objects.

The failure rate was estimated to be near 80%.

One might think that this would have the aviation and travel industries all frothy and indignant. Heck, some of these folks have claimed that so much as a ban on a couple of countries which have poor internal security and which generate near zip tourists to the US is a giant threat to our travel economy.

One might think that the news that our airport security stinks would be a major factor in deterring visitors to the USA, and there would be calls for some immediate remediation.

Nope.

Not a peep from any of the alphabet organizations inside the Beltway. Remember the labor union that a few weeks ago so loudly denounced the plan at PIT to let non-ticketed people in to the main terminal, calling it a threat to security? Not a word from them, either.

Think About How Incompetent The Rest of The TSA Programs May Be. Here’s a fun thought. If the simple stuff like identifying pointy objects isn’t being done, it’s a lead pipe cinch that the more sophisticated and difficult security aspects – such as perimeter and AOA screening, not to mention complete threat-identification and event-mitigation programs – are also being ignored. You can make book on it.

There were hopes that the Trump Administration would clean house at the Department of Homeland Security and the TSA. Apparently, not. Or, at least not yet.

Take The Easy Way Out. Blame The Folks In The Blue Shirts. Take a look at the media coverage… virtually all of it discusses how the front-line screeners supposedly aren’t doing their jobs. It’s their sloppy work, according to the veneer “experts” and zipper-brained network reporters.

Wrong. The actual slop in work product is at the media outlets that spew out this shallow-fact garbage.  What they generally duck from is any criticism of the people at the top of the TSA – the ones who are planning and running the show.

Here’s a fact that’s being missed: the people in the blue shirts at US airports are doing an excellent job.

That’s because they are doing exactly what the management of the TSA directs them to do. They are working within the rules, oversight, supervision and direction of TSA management.

The only real problem with the front line at the TSA is that they are stuck  working for people at the top who are simply unaccountable, unqualified and inept. A 96% failure rate two years ago, and now an 80% flop score illuminates that it’s not the front line that’s got the problem. It’s the kiddie-table expertise at the very top of the TSA that needs to be canned.

Unfortunately, however, these people are not in line for any criticism from the media.  Any major outlet that would legitimately cover this clown show knows that they might not again get direct access to the TSA Administrator or the head of Homeland Security. Those suck-up oh-so-cordial B-roll walk-and-talk pieces with the TSA administrator are great for the 6PM news.

If there’s an 80% failure rate, it means that the system is faulty and the management at the top are incompetent and the entire front offices of this gong show need to go.

Say it again… the system is the failure, not the people staring at semi-effective baggage screening devices all day, or trying to nicely explain that, no, grandpa, your Swiss Army knife can’t go through.

But, it seems that the Washington fraternity is holding tight, circling the wagons around the clowns who are  mismanaging airport security.

Having an airport security system that doesn’t work is apparently not a big deal to them, compared to making sure they have the connections they need at the top.

That may seem a bit rough. But this is pretty much the same situation as in 2001, when FAA Red Team inspectors tried to warn the people at the top about bad aviation security.

Politics and the need for access to “pull” took priority then, too.

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And Finally…

Thanks to the many folks who commented on last week’s discussion of how a lot of traditional “air service development” schemes simply mislead small communities into the planning weeds.

As we’ve pointed out to our clients, all channels of communication have fundamentally changed in the past 20 years, and that includes the applications and effectiveness of air transportation. Most traditional ASD programs simply pander to small communities’ natural desire for scheduled flights at the local airport, instead of candidly outlining new realities.

To be sure, that’s probably not a popular position in a lot of circles.

But, then again, maybe it’s a lot more understood than it may appear, judging from the positive input we’ve received from professionals across the industry spectrum.

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Update: November 20, 2017

Keeping America Connected To The Globe…

Accept It… It’s An Inter-Modal Future. 

American Airlines is dropping flights to Laughlin-Bullhead City.

It sounds like a minor adjustment in a big airline system. But it’s a lot more than that: it’s indicative of the new realities of air service access for small communities, and is just the latest example of how small community air service access needs to move beyond 1980’s planning.

Initiated last year and supported by a federal Small Community Air Service development grant plus a reported $250K in local marketing, the flights to the American Airlines hub at Phoenix clocked in at something like a 44% load factor.

There was nothing wrong with the AA Eagle service. The two segments had great connections to AA flights at Phoenix. But it failed miserably.

Actually, this shouldn’t be a surprise. The service was simply not competitive for consumers, even though they were the only scheduled flights at the airport. The fact is that consumers had other scheduled air service options that were qualitatively and quantitatively vastly superior. The difference was that these options are at Las Vegas – 90 minutes away.

This is a poster child for the need to rethink all air access planning at small communities. Here’s a hard question for small communities: do you want “flights” at the local airport, or do you want air access. The two are not always the same.

Yeahbutt, We Need It. It’s natural for communities to believe that service at the local airport is an economic necessity. But that’s sometimes neither possible, nor beneficial. The shame is that most current “air service development” approaches pushed onto small airports focus on keeping small communities locked into outdated planning and obsolete approaches that don’t have a snowball’s chance in Miami of connecting them to global economy. In fact, a lot of this thinking is based on an airline system that no longer exists.

Reality: air transportation isn’t economically possible or “consumer-possible” at many small community local airports. This is anathema to even suggest to the local mayor, but it is a reality that needs to be dealt with in economic planning. In many cases, it is a dead-end in regard to accomplishing the main reason for scheduled air service, which is having access that consumers can use from – yes, from – the rest of the globe

It’s About Access. Not Just Local Flights. It’s not that there isn’t traffic generated at Laughlin-Bullhead City. The hard fact – ignored in most small-community ASD “studies” – was failure to understand that just having flights at the local airport often isn’t necessarily more consumer-convenient than other options.

In this case, the 90 minute drive to Las Vegas, which hosts nonstop flights around the globe, is far more valuable than low-frequency local flights that connect to a single airline system at Phoenix. The total travel time for consumers to most destinations was likely far less at Las Vegas, even with the drive to McCarran International. And the flight options at LAS are galaxies beyond the AA hub at PHX.

(In fact, Las Vegas McCarran International has more nonstops to more cities than any other US airport.)

Point: local connective air service at small communities can be successful only if it is superior to other consumer options. It isn’t possible at Laughlin-Bullhead City. It isn’t at places like Topeka, Naples, or Youngstown, either. It’s the nature of airline business and airline economics. Consumers in these places are fortunate – they have great air service access… it’s just can’t be viable from the local airport in contrast to other, better options. Even with a longer drive to the gateway airport.

It’s called total air access time. But it’s one dynamic that’s steadfastly left out of most of the air service development studies delivered to small airports.

Always Sunshine Results. Funny. It seems that just about every “study” done for very small communities to “find more airlines” always comes back with a positive conclusion, but one that assures that more consulting work will be needed… like maybe a “diversion study,” or a “catchment analysis,” or other efforts.

But in most cases, the actual airline – the one or ones that are potential viable targets – are usually not mentioned. It’s implied that there are lots of airlines out there – and connectivity levels from the rest of the globe aren’t really mentioned much.

It’s hard to find any of these projects that ever even hint that there may not be “another airline” even vaguely interested, or that there are better consumer options that may be lethal to potential service at the local airport. Or that illuminate the potential for air access strategies other than non-viable flights at the local aerodrome.

Keeping The Blinders On & Hoping For The Best. Usually, the only factors focused on in most traditional “air service development” programs are things like the “needs” of the community, or the glowing results of a recent unscientific online survey, or a grand “catchment study,” accessorized by lots of expensive point-of-sale data that isn’t particularly comprehensive, but looks great on that heat map illustration. And, usually, no identification of whether the community fits into any existing airline’s strategy.

Air transportation is all about better travel options. In many cases, the service that a small community can support can’t meet that standard.

Again, the future is in assuring air access – and often the local airport won’t be in the play. Yet most ASD schemes simply keep communities focused on the past, instead of crafting plans that adjust to the new air transportation economic realities.

In 2018, we’ll see fleet changes in the major network airline systems that will accelerate regionalization of air access.

And this will accelerate the need for regions to re-think air access strategies. Traditional ASD studies will only divert energies from finding regional solutions.

Bank on it.

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Update – November 13, 2017

Starting Out This Week…

“US Airports Would Do Well To Become China-Friendly”

Travel Weekly Acknowledges BGI China-Welcome Programs

Boyd Group International and its partner, China Ni Hao, LLC., have been working with a number of airports and communities in developing tailored programs that will put them ahead of the competition in gaining a larger share of the burgeoning Chinese leisure traffic and Chinese business investment in the USA.

Posturing to have a higher profile in the China sector will be important for communities of all sizes, and BGI/CNH are at the forefront of providing professional and very functional outreach systems.

From China Kits for episodic visitors from the Middle Kingdom, to China-Welcome programs for airports, through full-function digital and website presence in China, we have the expertise to make sure that when Chinese visitors and businesses look to come to America, our clients are ahead of the pack.

By the way, don’t get too comfortable if your website has a machine Google translation… you look really foolish to Chinese visitors and web designers who include this aren’t doing you any favors.

We are honored that Travel Weekly just posted an article on this subject.

Take a look.

And for more information on how we can get your airport and community in front of Chinese consumers and businesses, check out www.ChinaNiHao.com.

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Aviation DataMiner Takes A Look:

Cuba: Vapor Demand Materializes

Sun Country Latest To 86 Cuba Plans.

Last December, Boyd Group International’s trend predictions for 2017 included the forecast that US airlines would rapidly find out that all the travel industry’s panting and drooling about the huge “pent up demand” for Cuba travel would look pretty amateurish by the fourth quarter of the year.

A few months ago, BGI also noted that any increase in restrictions on Cuba access coming from the Trump administration would be a perfect smoke screen excuse for carriers to cut back and save face… not to mention saving a lot of money from not running semi-empty airliners to places that most US consumers have never heard of.

And that is exactly what’s taken place. The traffic demand to Cuba is a dud.

And what traffic that has been developed is likely to be mostly the kind of group tours that were in place before Obama went to Havana and basically apologized to the  dictator who’s running the place.

Standby For More Exits. Spirit, Frontier, Silver, Spirit, and now Sun Country have taken a pass on Cuba.

American has cut way back, and can be expected to do more in the first half of 2018. A 56% load factor, CLT-HAV isn’t going to cut it.

Southwest experienced ghastly load factors in markets like FLL-Matanzas, and FLL-Santa Clara.

Masking this, a couple of carriers, according to sunshine reports in the media, have requested more rights to Cuba.  The stories conveniently leave out that they’re asking for Havana and mostly from SE Florida – which, looking at the load factors so far, is still very iffy. But nobody is lining up to add service to Camaguey or Cienfuegos.

No Infrastructure. No freedom. No Economy – What Does That Say About Air Travel?. It’s not a surprise. Ray Charles could have seen this one coming.

As a vacation destination for US consumers, Missoula and Bangor and Santa Fe have more value to offer than Cuba… actually, a whole lot more.

And now, right on the fake news cue, some in the media are implying that these airline cuts are due to the Trump Administration’s revisions, making it harder for individuals to visit the Worker’s Paradise 90 miles off our coast, and making it difficult for US companies to sell lots of products to the eager Cuban economy.

You bet… we’re told that the “people to people” thing was a sure winner… bringing citizens together and building new friendships between our two countries. We were told that the Cuban economy was going to be a demand bonanza for US goods.

Somebody lost chain of custody of these folks’ last drug test.

People-to-people? Super… if they could talk freely, the Cubans could tell us all about how they have no right to vote, that they have shortages of key goods, their pay rates are at the subsistence level, and that they can’t travel freely out of the country.

Fact is that we can talk to Cuban citizens all we want. They can’t talk to their own government, so only people incredibly naïve could buy into that dishonest “people-outreach” garbage lauded by the last administration.

Oh, yeah. All that great business opportunity? Except for a hotel deal or two, or a highly-publicized deal where some company will supply hand-tractors to the primitive farming system in Cuba, there is no business base.

And, by the way, the US embargo has nothing to do with this. Cuba can buy whatever they want from the rest of the world. Their economic system has trashed the place to the point where they can’t.

Worse, most of the companies that do exist are run by the same Cuban military that makes sure there is no dissent among the populace. Message: doing business with them won’t help the Cuban people, but just enrich the thugs running the Cuban military.

These are just a couple of points that won’t be on the 6PM news. Not politically-correct, see.

But they are core reasons that any major level of US-Cuba air travel demand simply does not exist.

Airlines Should Be Thanking Trump. For the airline industry, however, all the media drivel about new restrictions killing off demand (that was never there in the first place), is a super excuse to get out of a lot of cash-burning flying,

In point of fact, the hard truth is that whatever Trump may have done or might do in regard to Cuba policy, it is a total non sequitur in regard to the traffic levels that airlines have experienced long before such actions were taken.

Other than Havana, most of the traffic is nonsense.

And even there, plan on more US-HAV markets dropped like a baby grand out of the 8th floor in the coming months.

Let’s Look At Some Numbers. As for Sun Country, they had the rights to fly from MSP to Santa Clara and Matanzas/Varadero.

Facts be known, most folks in the Twin Cities wouldn’t know these places from a medianoche sandwich.

So, accessing Aviation DataMiner, let’s take a look at the stellar demand from the US to these points through the end of April:

Point: if American and Southwest can’t make these markets a go from SE Florida – where over 60% of Cuban-Americans are located, the chances of Sun Country Airlines getting walk-up, individual demand  or even group movements, from MSP are right up there with winning the national lottery on Mars.

Here are a few other stellar examples of how the Cuba market is tanking… and, again, it’s likely that the yields  on these flights are not warming the hearts of airline CFOs, and the costs of doing business at Cuban airports probably are no bargain, either.

And, then there’s Havana….

Better load factors, but not anywhere near system averages, and you can take it to your bookie that the yields are close to bargain-basement and the costs of Cuba operations are in the stratosphere.

Bottom line: Until there are changes inside the cleptocratic Cuban government, and until  Cubans are allowed more freedom than inmates at a minimum security prison, and until the business base (such as it is) gets out of the control of the totalitarian Cuban military, US airlines can just sit and wait.

Trend Forecasts…The Advantage For Our Clients. We’d again point out that BGI forecasts outlined this situation in a comprehensive study in 2009, and an updated one two years ago. Somehow, we didn’t see any of the rest of the players in the aviation consulting business come out on this subject.

Also, our work was not well accepted by the travel industry, which by and large totally ignored most of the hard realities of Cuba, and instead trumpeted how Cuba was the Next Big Thing.

Now that the Cuban vapor hole is  as obvious as Osama Bin-Laden showing up at a Bar Mitzvah, watch for the “reports” and studies coming out in early 2018 from the Usual Suspects in the consulting sector, “predicting” a decline in expected performance of US-Cuba  markets.

It’s always safe to predict what’s already happened.

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Update – November 6, 2017

Airline Marketing Alliances… Nothing’s In Stone

Last week, China Southern let it be known that they’re looking at moving out of the SkyTeam alliance, in light of American’s minority share purchase in the Guangzhou-based airline.

With the opening of the huge new Daxing airport in Beijing in 2019, China Southern is expected to have a substantial connecting operation – which would compete with the one expected to be established by co-SkyTeam member China Eastern.

So, plan on China Southern joining the oneworld alliance, which will finally give American a true Chinese airline partner, above and beyond what’s already in place with Hong Kong based Cathay Pacific. This will open China-US traffic access to new levels.

Cathay’s oneworld membership, however, may not be one to make book on the next time you’re in ‘Vegas. Seems that Qatar Airlines, recently, has bought a nearly 10% share of Cathay, which does have some presence for code-sharing with AA to points in SE Asia. Nevertheless, a China Southern code-share at PEK outshines by far what AA could lose from CX potentially pulling out of oneworld.

And speaking of Middle Eastern carriers Etihad has announced that they are dropping service to DFW, because of, they say, AA’s decision to cancel their  code-share agreement.

The point is whether yields made any sense. Film at 11.

(Note: thanks to the folks who corrected our mixing Etihad and Qatar in the initial posting!)

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The “Pilot Shortage” – Choking Air Service?

It is a clear fact that airlines are having difficulty attracting candidates to the pilot profession. The need to accumulate a now-required 1,500 hours of experience is a huge financial barrier to attracting candidates for the profession.

But, according to the dogma behind the rule, this will make us all safe from the tragedy of flight 3407, which crashed on approach to Buffalo in 2009.

Declare Anyone Who Disagrees A Heretic. News stories have illuminated that a proposed appointee to the NTSB has gone on record that the 1,500 hour rule, passed  after the Continental/Colgan crash, does little by itself to avoid what happened that night.

The media response was like lightening – this guy wants to cut back on safety! Facts not necessary, by the way.  Wider discussion not needed.

At the congressional hearings to vet this appointee, several  politicians grabbed their soap boxes to denounce this candidate’s refusal to accept the wisdom of the rule.

He correctly pointed out, however, that the NTSB findings faulted training and oversight at the operator, not pilot time.

He also had the audacity to point out that this 1,500 hour rule – which is so zealously defended as the lynchpin of safety by certain lobbyist sectors and in the me-too media – wouldn’t have kept either of the incompetent pilots out of that cockpit.

The fact is that they both had more than this supposed sliver-bullet minimum. The fact is, then, that this sacred rule isn’t a solution to the issues that caused loss of life.

Do Not Even Suggest Alternative Solutions. Here’s the bottom line: open discussion and exchange of ideas on this subject are closed.

“The science has been decided,” as it were, and anybody who dares suggest that the pilot time rules put into effect  need to be reviewed, is attacked and pilloried like heretics  during the Inquisition who didn’t fully agree with the Pope.

It’s actually unsafe to even suggest alternatives.

Airport Input?  That brings us to the airport industry. Airports are losing air service access due to this rule – which, again for clarification, would not have prevented the Buffalo accident – then maybe the airport industry may want to take a more aggressive stand. To be fair, there are efforts, but they are drown out by cheap politicians playing to emotion, and dishonest media that postures the 1,500 rule as a not-to-mess-with rule.

Maybe a call for additional scrutiny of what can be done to keep skies safe and air transportation un-choked is now in order. And, indeed, consistently responding to these political mediocrities and special interests that their love for an arbitrary rule, instead of comprehensively improved training and oversight, it not making the skies any safer.

There are solutions that can be explored in regard to increasing safety.

But the 1,500 rule by itself doesn’t eliminate the causes of 3407.

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Update – October 30, 2017

Southwest – A Snapshot of Fundamental Changes

We thought it might be interesting to take a look at where Southwest is today v the year 2000.

Using Aviation DataMiner, we compared the key metrics for the top 10 WN airports in 1Q 2017 v those in 1Q 2000.

Very revealing – it’s an airline that, other than its core focus on customer service, isn’t much the same as it was back then.

Note that two of the 2017 top ten – Denver and Orlando – weren’t on the Southwest top ten route map in 2000. They are now lynchpins in Southwest’s traffic flows.

The percent change in key metrics indicate an airline with a route system fundamentally different than in 2000…

The real metric of interest is the change in average passenger trip at each city, showing how the reach of Southwest has expanded. It’s not a short haul airline, despite some veneer media lore. In fact, the average passenger LOH has gone from 546 miles to just over 900 between 2000 and 2017.

This also indicates the criticality of connecting traffic for Southwest. Point-to-point is important, but its revenue streams are increasingly reliant on connecting passengers across its operations at MDW, PHX, HOU, STL, etc.

Just One Example of The Insights Delivered By Aviation DataMiner. In aviation planning, access to hard, analytical data such as this is critical – and that means going beyond what comes off of raw BTS websites. Aviation DataMiner delivers the analytical firepower that gives industry professionals the competitive edge.

With hundreds of immediate reports -analyzing fares, yields, traffic flows, capacity, load factors, route performance and forecasts, Aviation DataMiner outshines any other source.

For a free trial, click here. We can have you on line literally in minutes!

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And, as a reminder…

It’s Now On The DOT Docket

The 2017 Small Community Air Service Development Grant Program

The docket is issued… not much change from last year… $10 million allocated. The same qualifications and filing requirements.

If your airport and community are interested in exploring whether a SCASD grant is the right approach, we’ve put together a free comprehensive guide that explains the program, and candidly discusses the pros and cons of whether to apply.

Unlike other consultants, BGI is very careful to work with our clients to assure that they aren’t chasing dry air service holes with an application. The program since 2002 has been riddled with applications that, even if successful, led nowhere in gaining new air access.

So, we’d be delighted to talk regarding the potential of a SCASD.

While we’ve won more grant dollars under this program than any other consulting firm, in the past four years we have been very careful regarding accepting these projects. We focus on pursuing results for our clients.

Click here to request the SCASD Guide… we’ll get it right off to you. Then give us a call.

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The Update

Proposed ATC “Reform” & The Mob Approach To Management Change

Anybody remember Paul Castellano?

He was the Don of one of the most powerful “families” in New York.

Nevertheless, he got whacked by his underlings in a high-profile hit as he arrived at a Midtown restaurant in 1986.

It seems they disagreed regarding management issues, but had no disagreements about the underpinnings of the family activities themselves.

It resulted in a  management change in the front offices of the family. But at the end of the day, the rest of the family continued to do business just as it did before Big Paul met his untimely demise. Just new faces at the top.

“Reform” – Whacking The FAA… But Keeping The System. What took place long ago on New York’s eastside is pretty much along the lines of the current hoopla around whether to “reform” and privatize the air traffic control system, or leave it in the clumsy control of a bungling government agency.

That’s what’s on the table. Change of management. Not a change of fundamental direction. Not implementation of a system of accountability for results. No cleaning of house. Not any discussion of whether the failure to achieve material improvements in airline schedule performance may be due to the NextGen program itself.

The reform crowd, not to put too fine a point on it, only wants to clip the current ATC Don – the FAA – and take over the “family” – the air traffic control system.

And like the capos who wanted Big Paul out, the ATC reform folks have no quarrel with the core business activities of the current FAA Don. They intend to keep the current staff, structure and modus operandi that’s there already, i.e., the system that doesn’t produce results.

They just want control – in this case, that means control of the NextGen program.

Flaw: Confusing “Reform” With Results. As a factual matter, neither side in the ATC squabble have any quarrel with what the FAA is actually doing… they have no criticism whatsoever on NextGen. it’s just the management style they disagree with.

Nothing personal – it’s strictly business. And will lead strictly to non-results, either way it plays out.

Sound & Fury Signifying The Wrong Direction. The noise surrounding whether the air traffic control system should be “reformed” or left in the blundering cloak of the FAA gets louder – and more irrelevant – with every press release from either side.

The “reform” crowd all contend that putting the ATC system under a semi-private structure will result in a new modernized system. These are sometimes accessorized with un-supported and frankly fruitcake predictions that “reform” will massively cut airline delays by double-digit amounts.

The anti-reformists are warning that privatizing ATC will be devastating to the air transportation system, as they claim it will turn it over to the evil airlines, who’ll certainly use to make more money at the expense of the consumer.

A key tenet of the anti-reformists is that privatization will result in small communities losing air service – a contention completely concocted and being nothing more than a desperation fear-grenade… not much different from the clowns that claim an end to EAS will close airports.

The point in all this is that neither side has a clue.

Neither side has a problem with the ATC NextGen “family business” – which is a fraudulent scandal that both want to continue to worship and retain.

Neither side has promulgated any fundamental changes in ATC modernization. Nobody has dared mention that NextGen has a rap sheet of failure longer than I-95. Nobody has suggested structural changes that address the bungling at the FAA for the last 30 years.

Both sides agree, apparently, that NextGen is the answer… they only differ on how it should be managed… or, mismanaged.

Now, It’s In The Airlines’ Court. What is becoming more and more clear is that the path to improving air transportation efficiency does not lie entirely within the FAA or the ATC system. It’s now the responsibility of the airlines themselves.

It’s clear that ATC – which is intended to maintain separation of aircraft – isn’t a solution to the entire range of issues and dynamics that have resulted in virtually no material improvement in “on-time” performance in the last decade.

GAO studies on ATC (the majority of which, by the way, do not blame funding for the mess the FAA has created with NextGen)  have noted that the actual causes of airline off-schedule operations are not fully understood. In some cases, the ATC system is the cause. In others, airport congestion. In others, sheer dimbulb operations management by airlines.

But one thing is now certain: this hype about “reform” fixing the system is based on bogus assumptions and PR doggerel. The anti-reform reactionists are even less credible – they don’t want to change a thing.

This is not to say that ATC modernization should not be taken away from the klutz-masters at the FAA. It just illuminates that whether “reformed” or remaining in the status-quo, there are no ATC-based solutions on the horizon.

So, rest assured that nothing is going to change. Both sides want to retain the problem, under different management systems.

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Update October 16, 2017

Selective  Security Outrage

One prime reason that, truth be known, AVSEC is still wallowing in a bureaucratic quagmire is that most of the aviation industry is loath to criticize the system.

Or, worse, mesmerized with the PR that comes out of the Department of Homeland Security.

The latest example is the strong objections of one flight attendant union to Pittsburgh International opening its shopping mall terminal to access from non-ticketed visitors.

The righteous outrage is well-scripted. This move by PIT will reduce security and threaten the flying public, is the claim.

But this same oh-so-concerned union never made any loud noises whatsoever when it was found two years ago that screener tests were being flunked at a 96% rate. Or, when other such information comes to light about the sloppy management of the TSA.

Whether or not PIT’s new policy will denigrate security is not the issue here.

The issue is that there are lots of aviation-related  and travel-related organizations whose credibility should be zero.

Taking on an airport is easy.

But daring to criticize the incompetents at the top of the TSA, well, that’s another story.

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Update October 9, 2017

Airline Financial Analyses  – Consider With Caution

Southwest just reported September results.  We came across a very interesting review of the carrier’s performance.

A couple of key measures declined Y-O-Y, such as load factor and revenue passenger miles, leading this source to declare that the airline’s performance as “disappointing.”

The report wallowed around, decrying a decline in RPMs of 4.5%, a lower load factor and other danger signs that were shown as prima face proof that Southwest was in decline in September.

Summarizing the veneer understanding of the airline business, this financial report declared…

“…Load factor (the percentage of seats filled by passengers) decreased 250 basis points (bps) to 81.7% in September. The key metric fell since the contraction in traffic was more than that in capacity leading to empty planes…”

Yikes.

Read that again, dig the comments within the context of airline industry metrics, and consider this comes from a source that postures itself as a reliable reference for investors.

The first red flag is the term “250 bps” to describe the decline in load factor. Nobody awake, sober and with even a high-school knowledge of the airline business uses “basis points” to measure changes in load factor. That’s a financial term, not one used in airline data.

Then, there is the contention that’s lethal to the report’s credibility. “… leading to empty planes…”

Misleading, unprofessional, and stupid.

That can only be described as a sure sign the writer might not be expert in the airline industry, particularly where the airline had a nearly 82% system load factor.

The uninformed reader gets the impression from this posturing “expert” that WN routinely flew empty flights, which was not the case. It does not say that the average passenger load, system-wide, was 2.9 fewer passengers on a fleet with an average of 149 seats per flight.

It does not reveal that in September the average WN flight had just about 122 passengers on board v 125 last year. That’s not empty.

It does not say that a few more seats on average were unoccupied. They didn’t say “empty seats.”

It does no explanation of any shifts in the WN route system that could explain the change in these measures.

No running from it. The report states  clearly that Southwest was flying “empty planes” due to the decline in load factor.

That’s fake news. To the consumer, “empty”means nobody on the plane.

If one is taking investment advice, a whole lot more informational precision might be expected.

On the basis of this, the source advises investors to dump their Southwest stock.

A Couple of Airline Metrics Not Considered. Now, Southwest is a big boy airline and can certainly deal with this half-baked financial reporting for themselves.

But there have been changes in the WN fleet and route system over the past year, and there are no danger signs regarding out-of-control route expansion, over capacity, or consumer issues.

We’d maybe point out that just reading SEC documents and Form-41 data, without full analysis and understanding of what’s behind them, or of the airline’s known and expected strategic direction, is a veneer way to make determinations on whether the airline’s future is going in the right direction.

There are a lot of strong airline analysts out there. But…

Caveat Emptor.

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Update October 2, 2017

Travel Industry: Where’s The Leadership?

Here’s the brief but accurate outline of what has become the political football of choice.

The Trump Administration is planning  travel restrictions on several countries, all of which have been determined to be places with inadequate counter-terrorism programs. Eight of these have populations that are predominantly Muslim.

Now, the number of travelers from these places is miniscule, and has very little impact on the US travel industry. It’s strictly based on security issues. As far as the US as a destination goes, this should be a plus to attract more visitors.

Get Political. Make It Something It’s Not. Unless, of course, the program can be accused of being a wider scheme to keep foreigners across the board out of the US. It is a  crackpot and dishonest attempt to shift truth into political fantasy. But that defines a lot of what goes on within a lot of political entities.

Now, because there are Muslim countries involved, the ACLU and other groups have declared the program as being one of racial discrimination, and by association, anybody who does not oppose these new restrictions is a racist. So, just because the implication of racism has been made, the safe path is to not call it for what it is: garbage

The fact that these countries – which do not represent anywhere near  the majority of the global Muslim population –  have been determined not to have adequate anti-terrorism programs in place, is left out in the pathetic brown-shirt-like protests about “hate” and America being a land open to all. Including, it seems anybody who may want to come in.

This notwithstanding all of the Islamic terror over the past year, and the fact that at last we have an administration that recognizes the threat.

And, contrary to what the ACLU and their political supporters are spouting, and the media is parroting like a cheap tape recorder, this not a blanket ban on Muslims. To imply that is a lie. It’s as stupid as if the ACLU sued ISIS, claiming they discriminate against hiring Christians.

Travel Industry Organizations: Closet Supporters of The Fantasy? Now, enter the travel industry. Instead of working to counter these dishonest missives, they are side-stepping them, and don’t have the gumption to bring out the whole picture.

The message between the lines from these travel organizations: These restrictions are silly and unneeded and damaging. No attempt to investigate regarding whether there are security issues involved.

One group has urged the president to re-affirm to the nation that these actions are not meant to harm travel demand to the USA. Like, if the full facts were reported, or even illuminated by these travel organizations, that comment would be completely unneeded. They should be getting the full story out. They aren’t doing that.

But apparently these Washington travel groups buy into the dishonest party line that it’s all about dimbulb racial discrimination. They don’t want to tell the whole story – which is their job, by the way.

Create The “Message” – And Then Claim That It’s “World Opinion.” Another travel group has warned that these actions are sending messages to the world that foreigners are not welcome in the USA. The only “message” is the one being sent by these organizations themselves.

The “message” is coming directly from the travel industry – it’s an inside job.

Having the US restrict travel from a few places where there are indications of lack of proper security should be something that they would embrace as a positive factor to visit the USA.

Instead, they are tacitly (at the least) providing support to the dishonest sectors that are claiming these restrictions are racially-based, and are just smoke screens to discriminate against Muslims. That’s a complete failure in leadership on the part of the US travel industry.

Do a search. Not one travel industry leader has come out to even outline the reasons for the restrictions, but instead have cowardly tried to spit out milquetoast comments that assure that they get no criticism from places like the ACLU or others in Washington who put politics ahead of national security.

Shameful.

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Archives – Updates May 2016 – June 2017

Archives…

June 19 Update…

SCASD Docket 2017…

What do these airports have in common?

Sarasota. Bozeman. Charleston. Santa Fe. Fresno. Midland. Binghamton. Erie. Richmond. Bangor. Spokane. Shreveport. Latrobe. Traverse City. Springfield…

They’re a few of the examples of where a BGI-crafted Small Community Air Service Grant Application has led to recruitment of new air service.

Since the SCASD program’s implementation in 2002, Boyd Group International has been at the forefront of crafting innovative, successful grant applications for communities across the nation.

In fact, we’ve assisted our clients win more dollars from this program than any other consulting firm.

The DOT is expected to issue the docket for the 2017 Small Community Air Service program shortly. We’ve just completed our Guide To Filing A Successful SCASD Application. It covers all the bases – what the program does and the issues that communities should include when considering applying.

The Guide outlines strategies for crafting an application, as well as the traps and mistakes to avoid to assure a competitive filing.

The Guide pulls no punches and discusses the factors airports need to consider before making a filing decision. We candidly review the types of grant uses that will get the DOT’s attention, as well as how to define which “air service deficiencies” can be addressed with a grant.

The Guide is complimentary, and can be requested by clicking here. Go there, and we’ll get it right off to you. It will give you a candid and forthright review regarding whether a SCASD application is a viable path to enhance your community’s air access objectives.

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Monday Update, June 19, 2017

Trump’s Cuba Policy

It Could Give Airlines More Cover To Pull Down Gracefully

It’s not there. And won’t be there for years.

We’re talking about the supposed expected boom in air travel to Cuba. The one that Trump’s new Cuba policies supposedly will harm.

It’s pretty hard to cut back on things that don’t exist.

Such as the supposed “great opportunities” for US business and for US airlines in Cuba that certain folks are now criticizing Trump for trampling upon.

Let’s Recap Realities. Boyd Group International’s independent reports on the Cuba “opportunity” in 2009 and in 2014 were very clear – and very accurate on the future of air travel potential with Cuba. That “bonanza” is years away, and entirely in the hands of the Cuban government.

So, Where’s The Common Business Sense? There is no business foundation in Cuba. There is no consumer buying power. There is no free trade. There is limited leisure-travel infrastructure, and what’s there tends to be of the “adventure” category.

Message: Tossing 737s into Cuban airports that have no traffic won’t create it. Nor will that change the people who are responsible for this economic mess.

Most of the businesses, such as they are, are run by the Cuban military, the same military that makes very sure there is no political dissent on the island. Their citizens can’t travel freely, let alone speak freely.

The air traffic bonanza that the media and the travel industry parroted as if it just got belched up at Delphi is a complete dud…and nothing Trump did, didn’t do, or might do, will change that.

Too Bad The Cuban Government Doesn’t Agree. But now watch the oh-so-concerned-about-humanity types denouncing the Administration’s latest actions. Funny, but we don’t hear these same “humanitarians” denouncing the people who’ve made Cuba a showcase of totalitarian mismanagement over the last half century.

Somehow, their twisted logic is that it’s the US that’s keeping Cubans in near-poverty, in an environment where free speech is dangerous and political repression is the foundation of the cleptocracy running the country. All that’s needed is more travel access, and all of that will change. It’s up to us, see.

It’s reminiscent of the anti-war protesters in the 1960s.

Funny, they never tried a few bars of “Give Peace A Chance” in downtown Hanoi.

It’s pretty much the same thing with the folks hyping Cuba “outreach.”

They have a message. But it’s devoid of any semblance of integrity – much like the Cuban government they refuse to criticize.

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Monday Update, June 12, 2017

To Start This Week

Congratulations to Traverse City… New Nonstops to DFW on American start this week.

BGI is proud to have assisted TVC with the successful Small Community Air Service Development Grant that made the service possible, as well as working to recruit AA.

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Before We Launch Into This Week’s Insight… Clear Your Calendar 

Air Access Realities & Opportunities 401

Hub-Choke. Road-Hubbing. Consumer Alternative Dynamics. Fleet Shifts.

You won’t hear about them at “air service development” events.  But these are the factors that are now critical to understanding how the new air transportation realities will affect air service access in the future.

Planning The Future With Futurist Metrics. Three years go, the IAFS outlined how traditional “air service development” approaches were becoming obsolete, and were founded on an airline system that no longer exists.

Furthermore, they tend to focus on what the community “needs” instead of what the new realities of airline economics can deliver.

Blind reports such as “true market studies” and “drive analyses” and web-based “cost calculators” merely measure things – often not very well – instead of delivering insight that relates to forecasting the future. And that means a lot of these exercises only deliver flashy and expensive documents.

That’s because most of these ASD programs are accomplished in an absence of honest professional knowledge of the emerging dynamics of the consolidated airline industry, so the numbers just measure the past, instead of forecasting the realistic future.

On August 27, there’s a new Workshop that will illuminate whole new directions to assure viable air access from the global economy.

Air Access Realities & Opportunities 401 will go into the new dynamics that airports and communities must deal with, such as analyzing what consumers will actually do in the real world of air service alternatives, not what they say on an unscientific survey that asks softball questions, the answers for which have no bearing on consumer behavior.

We’ll outline new consumer trends. Things like road-hubbing, which represents strong opportunities for some airports, and tough realities for others – realities that a “leakage study” or web-based “cost calculator” won’t change. We look at hub choke – a factor that requires forthright analysis of the value of the traffic that a market can deliver. We look at the new applications of new-technology fleets.

These are core planning factors that “ASD” ignores completely.

The global economy will affect all airports. So we’ll look at the regional consumer air access effects as airports such as Columbus, CVG, Sacramento, Indianapolis and others gain long-haul international access.

This all goes way beyond current “air service development” – because it addresses the future.

Bring your board members to this Workshop. The mayor, too. But come ready to work… we’ll be covering and discussing issues that will pummel a lot of ambient thinking.

For more information on the Summit, and the other exciting pre-Summit Workshops, click here…. And get prepared for whole new perspectives beyond shopworn “ASD” concepts.

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ATC Privatization Pro & Con

Either way, It’s Preserving Incompetence. Not Fixing It.

It’s rare to have a dispute where both sides are flat wrong.

But that’s exactly the case with the brouhaha with ATC privatization. The “pro” side is spouting off all manner of nonsense about how privatization all by itself will magically lead to better air service, less cost for the consumer, and more efficiency in moving airplanes across the skies. Instant solution!

Nowhere do they state how this will all happen, except for some babbling about “reliable funding,  government red tape removal, and – of course, “it’s satellite based!”

The anti-privatization folks are much more creative, albeit just as far off the mark as the pro crowd.They claim it’s a giant power grab by the airline industry, who will use ATC to cut off air service to small communities, and use it to their evil advantage to make more money. Small airports will be savaged by a greedy cabal fixing to torpedo their economic future. It’s right up there with the Chicken Little stuff that’s been spouted about the proposals to end EAS. Lots of self-righteous emotion. Short on facts.

Neither side has ever – ever – focused on the reasons that air traffic control is a Third-World mess. In fact, both sides, most of the members of which couldn’t tell the difference between ATC and an ATM machine, are in total agreement on keeping the two things that are at the root of this 40-year-old scandal.

Those are NextGen – which they accept like a pack of gullible “marks” at a rigged carnival game – and the sheer incompetence of the management of the ATC programs over the last four decades.

NextGen itself – and any honest review of the history of this program shows this – has been a parade of shortfalls, missed deadlines, dishonest promises and wasted money. But the veneer “experts” talk about it as a miracle, and it’s only funding that has held it back.

Now, it’s not politically correct to point out that the NextGen emperor is as naked as a jaybird. After all, every media story touts the program as the new messiah of the sky. “Course,  none of these reporters ever check the source.

The second reason for the ATC program swamp is more fundamental. There is no accountability for failure or mismanagement.

There is total agreement from all sides of the privatization issue: NextGen is not to be questioned, and the people responsible for this mess are not to ever be held accountable..

Neither side – and heaven knows the media, too – have ever bothered to check out GAO and DOT IG reports on the NextGen fiasco. The reports are clear: the entire program is a misfire when it comes to delivering a clear, well-visioned system to meet the future. Deadlines missed. Timelines revised. “Delay” stats with no real improvement.

And this in the light of the fact that last year there were 15% fewer airline flights than in 2007.

And both the Trump Administration and its opponents want to ignore it all.

So, don’t fear change. As for the ATC fiasco, there won’t be any.

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Aviation Updates & Insights

Update: Tuesday May 29…

Recognizing US Memorial Day Holiday

Media Stories On Aviation. Caveat Reader.

There are, in fact, several outstanding media professionals reporting on the airline industry.  A number of them are experts on the subject, and by themselves are outstanding sources of knowledge and insight.

However, they are denigrated by a few others in the Fourth Estate who really need to find alternative employment.

In the last few weeks…

Quoting Great Sources…When a JetBlue flight returned to Buffalo after it hit a bird, a random passenger tweeted that the plane hit a seagull – specifically that species – and cracked a turbine blade.

Incredibly, a Fox News story just repeated it. Like, as if it had any informational value. This was regardless of the fact that there was no visual damage to the engine, and the passenger involved probably wouldn’t know a turbine blade from a popsicle.

Yet that was included as a key part of the story. Sources, anyone?

Stretching Hyperbole To The Non-Factual. The New York Times ran an article on how empty Memphis International Airport is, with lots of discussion and pictures of gates left over from when Delta had a connecting hub there.

The tone was vaguely in the direction that the place was a dying, crumbling ghost airport. Actually called it a White Elephant – a term that implies that the airport has somehow screwed up.

But the New York Times conveniently left out the major air service changes at MEM since the elimination of Delta hub operation, such as Southwest, Allegiant and Frontier coming to town.

Further misinforming the reader, the story showed a picture of airplane models on a shelf in the director’s office with this flatly stupid, and unprofessional comment: “Scott Brockman, the airport’s chief executive, can often see more planes on his office shelves than at his terminal’s gates.”  An absolutely inane comment that has nothing to do with the status of the airport.

Also missed by the New York Times… local traffic at MEM is actually up from when those now-empty gates were clogged with passengers, most of them connecting on Delta.

Oh, yeah – and MEM fares today, adjusted for inflation, are down 15%.

Consumers and readers would be more interested in these statistics than the contents of the airport director’s office shelves.

Gotta ask: what else in this newspaper is vapor-brain reporting? Or intentionally slanted….

Going Trendy Instead of Factual. And there’ve been the oft-repeated stories on how US airline seats have shrunk in width over the years, this sometimes coming from  supposedly-prestigious financial mediums.

A commonly-reported statistic across the media is that seats are now averaging 16.5 inches across in US airliners. It’s flat out not accurate, but it makes great reading. Fiction often does.

If It’s On In Prime Time, You Shouldn’t Question It. No need to touch on the 60 Minutes story on Allegiant. There have been a number of aviation folks who have taken it on.

Quoting Numbers That They Are Clueless About. Then we have the nonsense reports every quarter after BTS data is posted, when reporters without a clue start confusing “passenger spend” with “average fares” and then compare them across the nation, assuring that nobody gets informed.

Creating “Trends” That Aren’t… How about recent stories regarding “why airliner windows keep cracking,” in light of the Southwest accident and a few other reports since. The fact that none of these events have any causal relationship to one another is blissfully missed.

Point: while the majority of aviation coverage intends to be direct and factual, there are a some decaying apples in the media basket.

Some are just misinformed.

Others, apparently, intend to misinform.

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International Aviation Forecast Summit News

United President To Participate At The IAFS™

Once again, we are honored to announce that Scott Kirby, President of United, will be joining us at the International Aviation Forecast Summit in Denver, August 19-21.

Mr. Kirby joins CEOs and senior executives from air carriers across the market spectrum and across the globe who will be at the IAFS™ and helping us explore the future.

What sets the IAFS™ apart from other events is that we don’t do boring, rambling and unfocused “panels” of attendees. Instead we focus on free-form one-on-one discussions with the distinguished industry leaders who attend.

If you haven’t registered yet, we’d suggest you do so now. Click here to review the tentative agenda, and then make the decision to come to Denver this August.

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Announcing!

Special Reception & Presentations –

Boom Supersonic

If you can get to Denver a day early, you can get an additional view of the future.

Boom Supersonic is hosting a special reception on Saturday, August 18, at its new headquarters and research center at Centennial Airport.

Blake Scholl and his team will be outlining the progress of the 55-seat, 2.2 Mach Boom airliner, as well as the one-third scale “Baby Boom” research and proof-of-concept aircraft that will fly in 2019.

Japan Airlines is on-board. So is Virgin Atlantic. So is Ctrip – China’s largest travel-related company.

The world is getting on board. Join us August 18 and discover why

For more information on the Summit, and to register, click here.

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Monday Update – May 21, 2018

The Cuba Accident – Be Careful of The Political Spin

In the wake of the tragic crash in Havana, there have been several corollary stories outlining how the national airline – Cubana – is a safety question mark.

It certainly is.

Their fleet is reportedly in a state of functionality just ahead of a Budweiser display, and their operational record is also reported to be a world-beater – in the wrong direction. This has been illuminated in several follow-up stories.

Unfortunately, these articles about Cubana occasionally have been accessorized by completely inaccurate implications that this flying junkyard (once one of the Western Hemisphere’s best airlines, by the way) is due to the embargo on US trade with Cuba.

The political spin: It’s at least partially the fault of the US that Cuba doesn’t have a safe airline.

According to the lore, the US embargo is restricting access to parts for their current fleet, and cuts them off from Western financing for new airliners, which would be easy to get were it not for the nasty embargo. And, according to the spin in one major city newspaper, the embargo forces Cubana to have to wet lease airplanes from second-rate, semi-reputable operators, like the one involved in the Havana crash.

That is all fake news.

Havana Accident: It Was A Mexican Airline… Let’s start with the Havana event… The 737 that crashed was wet-leased from a Mexican operator. There are no US prohibitions or trade embargos or airplane parts deprivation policies that apply to Mexican airlines.

So, if that company had a safety problem, it has nothing to do with any US policy toward Cuba. It’s the Cuban government that hired this airline and its 737-200 that originally entered service with Piedmont in 1979.

An article in the New York Times spun this, implying that this was Cubana’s only option: lease from operators on the edge.

Which is fake – the Times knows that there are lots of companies that wet-lease airliners, and most are safe. It was Cubana’s decision to put its passengers at risk by using the company involved.

Let’s Talk Cubana. It has been reported that just last week a substantial part of Cubana’s fleet was grounded for safety reasons.

Some implications have been made that it’s due to lack of parts, and again, the distant if not direct allegation that it’s due to the US embargo. Cubana, supposedly, can’t get stuff to fix their fleet, and it’s the nasty USA that’s the reason.

The torpedo of truth in this case is that the airplanes that Cubana has sitting grounded – a total of 16 flying machines – include just four – count them, four – western airplanes, all ATR-42/72 turboprops.

The rest are a motley collection of Soviet-designed junk, from TU-204s, to a single IL-96, to several An-158s.

If Cuba’s shopping for airplane parts in the US, they’re out of luck, with or without an embargo.

Check it out… there aren’t a lot of vendors in the US that support the  Soloviev PS-90 engines that are hanging on the four TU-204s (nee 757-ski) that are now rotting away on the ramp at Havana. If it’s parts that grounded them, it’s a matter between Cuba and some factory in Russia.

Then there are the stories regarding the recent grounding of Cubana’s  fleet of AN-158s, which for the record is a blatant Soviet-era copy of the BAe-146, except with two engines instead of four, neither of which, apparently, work very well.

In any case, the Cuban feds pulled the plug on these contraptions, claiming they have “design and manufacturing flaws.”

They seemed to leave out anything about the US embargo causing those flaws.

Tough To Get US Aircraft? Yes. But There’s That Little Issue of Lender Risk. Yes, Cubana may have had a bear of a time getting parts – from the factories in Russia and the Ukraine that originally screwed these airplanes together.

Now, the fact is that most new airliners do have a lot of US content, and that can muddy the ability to order a fleet of new A-320s or CSeries, or even a fleet of COMAC C919s from China.  But that does not have anything to do with Cubana operating Soviet-era airplanes that their own government has declared to have design flaws.

Embargo notwithstanding,  the US content apparently didn’t stop the acquisition of seven ATRs, four of which are still in operation at Cubana. Plus, Cubana over the years has wet-leased in fleets of 767s, DC-10s and A-320s – all of which are eons ahead of the stuff they’ve gotten from the fine folks in Russia and the Ukraine.

Furthermore, because Cuba has fully attained a 4th world economy – with a population that’s generally not able to leave the country (let alone have the income to do so) Cubana isn’t a great potential generator of traffic, beyond bargain-rates for EU and Canadian holiday travelers. So, there’s an open question whether it is a viable finance risk.

The point is that Cuba’s economic model, and that of Cubana’s traffic base, probably would make access to Western aircraft financing very difficult… Cubana’s traffic model is as corroded as the rest of the Cuban economy.

Cuba: Years Away From Prime Time. As BGI studies have pointed out, Cuba is potentially an explosive new revenue source for US airlines. But it’s several years and a full government change away.

Four US carriers have given up on this supposedly pent-up opportunity.  It’s a lead-pipe cinch that the remaining US airlines will re-structure some existing flying. Not much traffic to Santa Clara or Santiago.

While a couple of carriers have picked up some the vacated Havana slot capacity, the fact remains that, according to our analyses, most of the traffic is coming from MIA/FLL, and as much as two thirds is Florida-generated – and almost all of that is to Havana.

Plus, the load factors from some US points are really embarrassing.

It all gets back to the core issue… Cuba is a basket case because its own government has chosen to pursue policies that keep what could be a prosperous nation trapped in the economic Crane fixture.

Maybe they can’t get grain from North Dakota, or automobiles from Detroit… but they can get just about anything they want from places other than the US.

The state of its national airline is just one part of this.

And it has zero to do with the US embargo.

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May 14, 2018

BGI Announces Major White Paper

Reconciling Air Service Access Planning

To The New Airline Economic Realities

Mark the date – August 19, 2018

That’s the day that BGI will formally issue a new, comprehensive White Paper on the status of the US air transportation system.

We’ll be cutting new territory and questioning a lot of ambient and obsolete assumptions in the area of air access and airline service.

The White Paper will compare the structural and fundamental changes in the air transportation industry, with the shifts that will be critical in airport and air service access planning.

As will be illuminated in the paper, the nation is a long way from where we need to be. We can plan for the future only by recognizing and accepting it. That’s not the case today.

The fact is that most of the assumptions used in air service planning – from the FAA down to local airports – relate to an airline industry that no longer exists.

Take just a cursory look.

… The FAA still ranks airports in “hub” categories when most have no such relationship to any activities represented by that term.

… The FAA still thinks there is an independent regional airline system, when it’s been gone for two decades.

… The FAA – and most other forecast sources – still believe that enplanements are the direct result of simple econometric factors.

… FAA data collection is out of date, but consistent with the computer power that was available 40 years ago.

… O&D and other metrics represent the past, but not the future. Increasingly, there is a complete disconnect between historic airline planning and what is represented by the new mission applications of airliners delivering discretionary consumer products, in addition to “air service.”

… Too many communities and airports are misled into believing that there are lots of airlines, and just a massive consultant “market study,” and an appearance or two at a couple of speed-date events will do the trick to “luring” more air service.

It’s time to call these things for what they are. Obsolete fantasy that relates little to the air transportation system of the future.

Traditional Air Service Planning – Rig For Depth Charges. Reality Is Coming

The 100-page White Paper – The New Air Service Paradigm – Time For New Thinking – pulls no punches.  It’s been developed based on the need to discard current obsolete thinking regarding how air transportation will shape the future.

Not Just Information, But A Planning Document. The White Paper is a working document that goes beyond data and into functional planning changes that airports, community planners and financial institutions need to consider if they want to match the trajectory of change taking place in the air transportation system.

The White Paper will cover the hot button issues, including:

The New Foundations of Air Service. Today, it’s more than just local “demand.”  The report analyzes the emerging shifts in how airlines are plumbing new revenue sources with their fleets.

Obsolete Government Data & Related Systems – the need for new metrics, and exactly what those need to be.  Relying on FAA forecasts, and the airline industry they describe, has no relationship to today.

Government Programs Aimed At Reversing The Calendar. Let’s get real, EAS and SCASDP programs need replacement. The White Paper discusses new approaches that are necessary.

Regionalization of Air Access. It’s here and it will demand major changes in airport planning.

Internationalization. – It’s an opportunity and a challenge for all US airports.

New Fleets. Next-phase airliners will change and improve access… plan on it. New fleet capabilities represent changes in aircraft missions.

Developing New Planning Programs. The White Paper will outline the specific areas that airports and the regions they serve must address to optimize the future… the air transportation system will be different, and strategic and tactical planning must evolve as well.

Available August 19 & Showcased At A Special Workshop.

The White Paper will be issued on August 19, at the 23rd Boyd Group International Aviation Forecast Summit, in Denver. The price for this comprehensive air transportation White Paper will be $795, and a press synopsis will be available to bona fide media.

Attend The Special IAFS Airport Planning Workshop. However, at the Summit, we’re planning an hour-long pre-event Workshop on August 19, covering the White Paper.  IAFS™ delegates who attend this Workshop will be provided with a complimentary copy.

As always, the media is welcome to attend.

This Workshop is another reason that the IAFS delivers more actionable insight and information than any other aviation event… any other. Click here to register!

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BGI Assists Ithaca In Pursuing Larger China Presence

Spearheaded by Ithaca Tompkins Regional Airport, and sponsored by the Tompkins County Chamber of Commerce, Visit Ithaca and a host of local businesses, BGI and its partners at China Ni Hao, LLC recently delivered a comprehensive China-Welcome™ Symposium to civic leaders in Central New York.

The region is already one of the most Sino-aware in the nation, with over 2.000 local Chinese students and faculty combined at Cornell and Ithaca College. BGI’s Airports:China™ data indicate over 58,000 annual O&D between Central New York and China, with approximately 50% captured at Southern Tier airports.

The Symposium Team delivered data, information and consulting regarding the evolving nature of the China travel situation, including shifts in demographics and the expectations of Chinese visitors and potential Chinese considering attending US universities.

China-Welcome™ Is Needed In China, Too. BGI/CNH China-Welcome™ Symposiums are different from other “China ready” programs, in that our team understands that efforts must be made on both sides of the Pacific to be competitive.

BGI and the team – which includes the former #1 China-US tour generator, the global leader in developing digital programs in China, and the leading expertise in China aviation forecasting – tailor each Symposium to the specific situation at each client.

We illuminate what communities can do to be more competitive to attract more Chinese traffic. We discuss cultural differences, effective wayfinding techniques, and the need to have brochures in Chinese to inform visitors of US-specific travel factors. The team can develop complete China outreach programs.

Professional Communication. The Chinese visitors – be they leisure, business, or education-focused – are highly sophisticated. For this reason, it’s unfortunate how many airports, communities and venues get hornswaggled into adding “instant” translation options to their websites.

We always advise against having any Google or machine translations of the local website, which are so inept as to be outright insulting. It conveys that the venue is sloppy and unprofessional. Always have materials created in Chinese, and never “translated” from English.

The BGI/CNH Team assists our clients in development of professionally-developed outreach programs that convey a welcoming image.

Every Region Has A China Opportunity. BGI/CNH have delivered tailored China-Welcome programs at communities of all sizes. There will be over 23 million leisure visitors from China in the next five years – and where they will visit will be determined by the level of awareness they have of communities and regions.

If your region is interested in moving ahead of the competition for this business, give us a call.

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May 7, 2018

Congratulations To Our Partner, St Vincent & The Grenadines!

Boyd Group International is excited to note that American Airlines will initiate service to the world’s newest international airport, Argyle International, from Miami on December 15.

We are proud to have worked with St. Vincent & The Grenadines for the past seven years, from a time when the airport was not much more than an enormous construction site, leveling mountains and filling in valleys.

BGI has assisted the Argyle project in a range of projects, from crafting air access strategies for American and other carriers, to accomplishing the starting-point operating budget for the facility.

This is just the start for this unique Caribbean nation with a population less than that of a third of Nassau County, and a venue that is really unique in the Caribbean.

Boyd Group International is now working hard to build additional air access to St. Vincent & The Grenadines – stand by for film at 11.

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New Forecast:
St. Louis Lambert Now Re-Classified As A Connecting Hubsite

There’s A Message Here Regarding The New Airline Industry

Boyd Group International’s Airports:USA® forecast system – the only airport enplanement projections accomplished in the private sector – now has re-classified STL as an established connecting hub airport.

Airports:USA® defines a connecting hubsite as an airport where a single airline has strategically applied resources with the objective of inter-connecting passengers, and where the result is that 25% or more of the total airport’s enplanements are connect-driven.

With the pull-down of the AA hub, the percentage of passengers being flowed over STL naturally tended to evaporate to very low teens. It was no longer a hubsite.

As of today, however, Southwest has again made the airport a true connecting hub, with over 25% of all passengers (mostly WN-driven) now simply using the facility to connect.

Please Don’t Get Confused By Outdated FAA Classifications. This, obviously, is counter to the ridiculous and obsolete use of the term “hub” in FAA nomenclature. Their description of “small, medium and large” hubs has nothing – zero – to do with anything vaguely resembling connecting passengers, and nothing whatsoever to do with any industry definition of the word “hub.” Actually, it is shameful that FAA data is founded on such ancient nonsense.

This causes unending entertainment from the media and some consumer entities who posture themselves as experts because, lo! they can pull down FAA/DOT data off the internet, and assume it has all the veracity of what Moses got off those tablets on Mount Sinai.

It does the nation no favors for the FAA to cling to these nonsensical, mislabeled descriptions. Not only veneer media types are taken for a ride, but even some of the dragon-level organizations in Washington have their policy-planning taken into the weeds by not recognizing that FAA data and classifications are strictly from the days when Lucy was doing pratfalls on Sunday night television.

One very large Washington organization actually asked us to rank “small” FAA-defined “hubs” by the percentage of connecting passengers at each.

It was a very short list.

Like, none. But there was a level of resentment when they were advised that the FAA definition was misleading them. These were their buddies across town, after all. This is the damage done when federal agencies refuse to recognize that the air transportation system isn’t a static part of the communication network.

If You Rely On Accurate Forecasts, Be In Denver August 19-21. The new STL forecast is part of the 2019-2028 Airports:USA enplanement forecasts that will be used and discussed at the 23rd International Aviation Forecast Summit in Denver, August 19-23. We’ll be exploring the trends – and their effects – on traffic levels at airports across the nation.

Any aviation entity that relies on accurate futurist forecast data should be at the Summit. In addition to clear and independent projections of enplanement trends across the nation, the Summit delivers trend and projection forecasts from the key players in the airline, aircraft manufacturing, and financial sectors.

It’s clear that FAA forecasts aren’t reliable – year after year, they have confidently mis-projected not only traffic growth, but have been mired in assuming that air traffic is just the caboose on a complex train of economic factors.

It’s Airline Strategies That Are What’s Driving Expansion. Ask any airport where Frontier or another ULCC has suddenly and unexpectedly announced they’re coming to town. The FAA’s forecasts were on another planet. That’s understandable – because airlines are now independently and unilaterally making expansion decisions that bear no resemblance to the antediluvian and inaccurate forecast methodology used by the FAA.

And that’s another dynamic that will be explored at the Summit – it’s airlines, internally and unilaterally, that are more and more calling the expansion shots.

Those 60-page consultant “studies” and ridiculous “leakage analyses” – which typically have no relationship whatsoever to consumer trends, airline fleet strategies and other issues – are no longer the driver of airline route expansion.

This means having a professional and ruthless understanding of airline strategies is a lot more important than doing some bogus “true market” study to “lure” an airline to the local airport.

Solid Data & Exploration of The Future. No other event delivers what the IAFS does… no milquetoast panel discussions, wandering aimlessly around issues. No cookie-cutter sessions delivered by wooden federal officials spouting the party line – one that’s the same at every event, and is verbatim from what’s on that department’s website.

The IAFS delivers solid futurist perspectives from the industry leaders making the decisions. Click here and take a look at the distinguished industry CEOs and senior executives who will be joining us.

Networking? No event delivers the interaction opportunities of the International Aviation Forecast Summit. The sessions are all-business, but the breaks and the outstanding evening events planned by our hosts, Denver International Airport, will be ones that no other event can match.

If you haven’t registered, we’d suggest you clear your calendar and do so now.

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April 30, 2018

Starting Point This Week:

Airliner Seat Size Lore:

Be Nice If Some In The Media Relied On Facts

Seat Size: More Media Misinformation… The House version of the FAA reauthorization bill requires the FAA to investigate setting size minimums for airline seats.

USA TODAY, reporting on the story, advises us that this is important because average width of airline seats has declined from 18 inches to just 16.5 inches.

That, not surprisingly, is a blatant falsehood. Untrue, non-factual, sloppy reporting.

Let’s go to the fact sheet, again. The narrowest seats in US airline system operations today (save a couple of small-aircraft air taxi operators) is 17 inches, and all 737s have 17.2 in economy (memo to USA TODAY, they always have been that width in standard 6-across configuration), as well as A-320s and E-170/190s are over 18 inches.

There is no way that seats have shrunk in width to 16.5. Mathematically impossible.

As we’ve seen recently with other airline reporting – such as the 60 Minutes selective-data “investigative report” on Allegiant – what shows up in the media isn’t always gospel.

Caveat consumer.

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Supersonic Air Travel…

It’s coming. And It’s Going To Be Positively Disruptive

China’s largest travel company – Ctrip – has announced that it intends to make a major investment in Boom Supersonic, the developer of a new 50-55 seat, 2.2 Mach airliner.

If you haven’t heard of Ctrip, it’s a $3 billion dollar – and growing – global travel conglomerate based in Shanghai.

They join a range of other global players that have invested in Boom – all of them sophisticated entities that are known for looking to the future. This new machine is expected to cut flight times in half on long-haul intercontinental routes, and do so at operating costs that will accommodate today’s range of business/first fare levels.

Not Just Faster, But A New Air Transportation Mode. Boyd Group International has completed fleet demand forecasts for Boom Supersonic, and we see not only “demand” but major disruption in airline product structure.

Very disruptive – to just about every segment of air transportation – airlines, airports, suppliers, financial institutions and – importantly – to consumers who will have a whole new travel/communication channel.

On one hand, it will offer a superior option to the existing business/first passenger segment, with travel time being far superior. On the other hand, in markets such as New York – London a 3.3. hour flight time will likely represent stimulation of demand.

Then, let’s think about effects on global airports and competitiveness of airports. Those that may be slot-restricted might be left at a disadvantage – meaning that some sectors of consumer travel will find alternative access points where airlines operate the Boom airliner.

Opening China. Then we have emerging markets such as China… there is no guarantee that the Middle Kingdom will have restrictions on the (low) sonic boom. That means enormous potential for both domestic and international supersonic service to and from interior commercial points such as Chengdu, Kunming, Zhengzhou – at a dozen other new-market opportunities. Point: lots of potential demand for this airliner.

Example: Florida-Latin America: the attractiveness of this aircraft could well deliver nonstops to key commercial points in South America… remember, this new modality focuses on high-yield business traffic. The businessman from Manaus needing to get to Central or Northern Florida could now have viable service to/from Sarasota or Jacksonville… avoiding the congestion at other gateways.

Not Just An Airliner. A Competitive Imperative. The 50-55 seat airplane, aimed at capturing and moving today’s premium first/business segment at 2.2 Mach, at fare levels similar to those currently offered, will effectively be a giant marketing hacksaw, slicing off the front cabins of current intercontinental airliners.

If a business traveler can get from New York to London (as just one of many example markets) in 3.3 hours compared to 6.5, at a similar fare, it’s a no brainer which mode he or she will choose.

But it appears that much of the inbred aviation cognoscenti fit into that category. For now, the dogma is decided… this airliner won’t work.

But give it 12 months, and the dogma will do a 180. It always does, when things get obvious.

A Competitive Necessity. BGI is the only consulting firm that has researched the Boom concept – and from the gitgo, we found that the concept has enormous merit. Globally, our forecast is for 1,300 units over the period from operational start (2024) through the following ten year period.

‘Course, the usual mamma-guy analysts (google it, if you must) have assured us from the start that the Boom concept was a pipedream – mostly based on their recollection of the Concorde, which came out before half of today’s world population were born.

Comfortable group-think lore… the usual suspects have circled the wagons.

“No cost-efficient or fuel-efficient engines exist…,” some have assured us, completely oblivious of any expertise on the subject, beyond what “everybody knows.” They do exist.

“It’s the noise issue,” was another warning, not aware that the projected sonic boom will approximate that of a car door shutting, and way below the racket made by trash trucks rumbling down Madison Avenue at 5AM, or that of a 737 on approach over Jackson Heights into LGA.

(This is not to imply that the US FAA will ever have the gumption to explore over-land use of any supersonic airliner – regardless of what the decibel levels might be, the political response would be quick, ugly and aggressive. It’s a battle they won’t take on. But the trans-ocean route opportunities are more than can gobble up 1,300 global airliners.)

Save Time? Be More Efficient? Nonsense! Customers Want Perks, Not Speed. Then there is the all-time most creative “reason” espoused by some of the all-knowing analysts to prove that the supersonic business class concept won’t work.

The argument: premium passengers want to stay in the sky longer.

They contend that the 55-seat Boom airliner, equipped only with wide, individualized recliner seats and footrests, will not be able to take long-haul premium traffic from existing-generation widebody alternatives, because it will get them to the destination too fast.

According to this argument, this premium business segment will prefer  longer flight times – to get work done, and to rest up and be fresh when they arrive. (To repeat, we are not making this up – these comments have been made with straight faces…)

See, the fantasy goes, premium class passengers will prefer the option of luxuriating in the sky for several extra hours, enjoying premium cocktails, wolfing down fine wine, dining on gourmet meals, enjoying a lavish dessert accompanied by a snifter of Courvoisier, before spreading out on a lie-flat seat to enjoy first-rate in-flight entertainment (IFE) on a giant flat TV, all warm and comfy under a lush duvet adorned by the name of some fancy designer.

Sure, getting to London hours earlier, and not having the time to wallow in luxury on the way to Heathrow will be a real deal-killer for Boom.

Funny, but there are certainly  a lot of aggressive corporate executives who would rather get ahead of the competition, instead of swilling wine and playing with a 14-way lie-flat seat for seven hours.

The Current Business/First Competition Will Be Decimated. By the way, anybody who believes in this more-time-in-the-sky stuff, probably hasn’t really seen the long-haul front-cabin service shtick that some carriers pass off as “premium.” (We won’t mention carrier nationalities… but take a guess.)

Take a look… from boarding to deplaning, it’s not necessarily what’s portrayed in the advertising…

…the four-color menus passed out before departure showcase a lush level of high-livin’ vittles…  but actual delivery sometimes falls a bit short…

Like, “premium cocktails” made with hooch barely a step above what’s in the bar-well at a roadside honky-tonk. Oops, that fine vintage wine selection that’s touted on the menu might not be on today’s flight. “But we do have some other options that are substantially better than Mad-Dog 20/20…” The gourmet entrée is likely to be plunked down on a pre-packaged plate or casserole dish, a la coach meals in the 1970s.

Oh, yeah, that plush duvet. When the passenger stretches out to relax, that duvet has no more utility than a blanket, embroidered designer name notwithstanding. And the viewing enjoyment available on the IFE system might resemble titles obtained in the last stages of a bankruptcy clearance at Blockbuster.

Point: The fare-paying segment that’s sitting in the front cabin today wants to get there. When the fare is the same, they’ll get on the fastest piece of warm iron leaving town. That is going to leave a lot of front-end wide-body real estate empty and seeking some type of re-development. Major international carriers would do well to start exploring this now.

Get Ready – The Airliner Demand Game Is Fixin’ To Change. The point is that this Boom Technologies airliner is going to change how airlines market their product, and how premium-segment customers fly.

It will also materially change fleet decisions and fleet applications for global international carriers. It is going to get sudden attention from other airframe manufacturers. (And once it’s safe to do so, it will get swooning attention from the oh-so-negative aviation analyst crowd, too.)

And don’t discount more Chinese interest. The one industry where they are materially behind the curve is in airliners. Their current and planned platforms (such as the C919, C929 and ARJ-21) are a decade late and several yuan short. A relationship with a product that Boeing and Airbus can’t duplicate would give Chinese aircraft companies and aviation suppliers a lot more access to airline front offices.

This means that as more major aviation and travel-related companies get acquainted with what this airliner will do, there’s going to the plenty more disruption.

Want To Get A View Of The New Future? Join Us In Denver this August for the 23rd Boyd Group International Aviation Forecast Summit, and get up close and personal with this next dimension in air transportation.

Not only will Boom be participating in the Summit, but we are jointly planning an exciting event to introduce this new airliner to the attendees… details coming soon.

In the meantime, if you haven’t registered for the 2018 IAFS™ – click here to reserve your space now.

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April 23, 2018

Fourth Quarter 2017 Fare & Enplanement Data…

Let The Media Circus Begin

The DOT has finally issued O&D traffic data for the last quarter of 2017.

Subscribers to Aviation DataMiner™ now have full access, and subscribers to the Quarterly Airport Performance Summaries will be receiving their copies in the next few days.

Just Because It’s From The Gov’ment Doesn’t Mean It’s Accurate. BGI’s Aviation DataMiner™ system has scanned and filtered the numbers to cull out the typical reporting errors, and we’ve reconciled the raw data against other sources, including airport-reported information.

The 10% sampling system still used by the DOT delivers a lot of misleading data – particularly at smaller airports and in less-dense O&D markets.

Just in passing – a GAO report noted that the 10% sample was originally necessary due to the fact that in ancient times – the 1960s & 1970s – computer power was a fraction of what was currently available. They recommended that the DOT go to a 100% audit of airline itineraries.

That report is now old enough to vote – it was issued in 1997. And here we still are. It’s the reason the Boyd Group International’s Aviation DataMiner™ is more accurate than any other source. We recognize that a 10% sample can send a lot planning into the weeds.

Now, let’s take a look at the 4Q of 2017…

First, regardless of the panting “reports” declaring  airport had the “highest fares” or had the biggest spike or decline, here’s some rain on the media parade….

There is no accurate way of comparing fares between airports.

Write that down… comparing fare levels – by almost any metric – between airports or between markets, is just plain inaccurate and, in many cases, indicative of amateur-act analyses.

Fares: The Drivers Are Different From Airport To Airport. In fact, the fares at each airport are the result of .factors that vary materially, based on the economic base, the geographic location of the airport, the levels of service, population, and other issues. The metrics are not consistent.

This is because the factors that contribute to what passengers pay vary materially from airport to airport.

For the 4Q 2017, we took airports with over 1 million quarterly enplanements, and ranked the top 15 by local O&D domestic passengers…

The fare trap that a lot of reporters, amateur consultants and analysts fall into is demonstrated very easily by comparing #1 LAX to #2 Denver.

Denver, to the uninformed, has much lower fares than does LAX. But take a look at what passengers are paying on a per mile basis… Denver has an average yield that’s nearly 18% higher than LAX. Reason? Take a gander at the length of haul. The consumer travel patterns represent a length of passenger trip at LAX that’s about 30% more than at Denver.

Therefore, comparisons of these fares are useless… because the travel mix is completely different.

Passenger Travel Mix Is Not Comparable. Below we look at 15 airports that had the “highest fares” in the 4Q of 2017…

Take a look… the average fare (here expressed as one-way, federal fees and taxes included) is clearly driven by the average length of passenger trip (LOH)… i.e., the geographic location is a factor that is not equal or comparable by airport.

Okay, how about what consumers are paying for air travel on a per-mile basis… we took the same airports (those over 1M quarterly passengers) and compared the cost per mile of the top 15…

The cost per mile is high in most of these markets because the nature of the traffic tends to be shorter haul… and, note too, that these markets are served also by Southwest, which according to media lore, always drives fares down.

They can, but even at STL, which is again now classified by Airports:USA® as a (Southwest) connecting hub, is the airport with the fifth highest per-mile fares.

Reason: the make up of the traffic results in relatively short consumer trips… hence, higher per-mile fares.

BTS “Fare” Data Reports – Approach With Caution.  A lot of media stories will come out, spouting the BTS “fare rankings.” Actually these are “air travel spend” ratings. They take the total passenger itineraries, and divide the total spend – including one-ways, multi-leg journeys, and round trip – and produce an “average.”

But just as consumer air travel patterns vary from airport to airport, so, too does things like the percentage of round trips in a market, or the percentage of multi-leg itineraries. Result… these are not accurate comparisons of “fares” between airport, because what consumers are “buying” will vary from city to city.

Want Better Analytical Firepower? The New Standard Is Aviation DataMiner™. What separates BGI from the rest of the suppliers of data is that we understand not only the shortfalls in raw BTS information, but we also are at the cutting edge of research on the trends that drive changes in air transportation.

Before you subscribe to any other source, check out Aviation DataMiner™ by clicking here… better analytics from Boyd Group International.

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Air Safety… Another Viewpoint

With all the media coverage of several areas of air safety, we came across a very interesting blog.

It’s a take on the recent 60 Minutes story on Allegiant Air, and it’s from a stand-up professional who is a source that doesn’t have a dog in the fight.

He reviews hard data, devoid of emotion and sensationalism. Fresh air.

In the interests of gaining additional perspectives, click here to give it a read.

It has several data-sourced conclusions that widen the discussion beyond mere repetition of what was originally presented in the 60 Minutes program.

Take a look – it presents a new set of analyses that that need to be brought into the discussion.

By the way, every airport director where Allegiant provides service should read the FAA’s response to the 60 Minutes attack on Allegiant.

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April 16, 2018

2019 – 2028 Airport Traffic Forecast:

Everything’s Unhinged

Big changes. Bigger uncertainties.

Here are some basic findings for next year, from the Boyd Group International 2019-2028 Airports:USA™ enplanement forecasts. It’s the only such data source compiled entirely independently in the private sector.

Traffic: up 4.5% – 5.0%
Among The Top Growth, Percentage-Wise: AUS, COS, SJC, RDU, SRQ.
Changes of Note: STL regains connecting hub status. (True)
Main Forecast Characteristic: Massive Volatility – plan on several airports seeing rapid and unforeseen double-digit spikes and declines. In fact, currently-indicated growth centers could disappear by August 21st, when the final 2019-2028 forecast is issued.
The #1 forecast finding, however, is what BGI has outlined for the last ten years: traditional forecast methodologies are today about as effective as a warped Ouija board.

Future Factor: The Value-Equation of Air Transportation Is Evolving. This is a major challenge for airport and regional economic planners… air transportation is no longer a utility… it’s increasingly a consumer option, and volume is more and more the result of where airlines make the corporate decision to increase – or reduce – capacity.

Business travel is today affected by changes in other communication channels. The ability to meet and do transactions electronically is rendering air transportation as too slow and too cumbersome and too expensive in many cases. This is one reason that a lot of attempts at tossing scheduled flights into small community airports are DOA. They don’t truly represent time-effective communication options.

Leisure travel is being spiked and stimulated in specific O&D markets via application of ultra-low fares. That new kitchen remodel can get put off a year, with the family budget shifted to an unplanned air trip to visit Florida, or even grandma in Philadelphia, due to the sudden presence of low fares.

Airline Expansion & Contraction: Strategically-Driven. Historically, national and even local air traffic forecasting was mostly a matter of doing some regression analyses based on a couple of economic metrics, and, poof! – all was well.

The assumption was – and, at the FAA, still is – that air travel demand was simply a static component of the economy. The “spend” on air travel was assumed to be concretely and linearly driven by economic factors.

It isn’t – at least not anymore.

The ULCC Product – Changing The Traditional Nature of Air Travel Volume. As we’ve seen with the expansion of ULCCs – Allegiant, Spirit and Frontier – the places where they suddenly expand capacity has nearly zero to do with static econometric data.

And often, little to do with whatever the current levels of service may be. For example, Spirit’s new Seattle expansion is right in the face of two legacy carriers, both doing quite well. There is not any capacity shortfall at SEA – particularly on the routes planned by NK.

This illuminates the new dynamic that puts a spread of torpedoes directly into the rusted hull of traditional traffic forecast methodologies.  It’s the fact that the expansion of these carriers isn’t to fill “air service gaps” or address “unmet” consumer demand.

Instead, it’s all about offering a new option for consumer spending… in short, most of the ULCC expansion is all about creating net-new revenue, instead of fighting for “market share.”

Air travel is now a consumer option, and consumer decisions are wildly volatile. Even the definition of “demand” is increasingly a mathematical greased pig – it’s now the result of a whole range of constantly shifting factors that are specific to each market.

But at the end of the day, it’s whether there’s capacity for sale, and it’s revenue generation – not just high load factors – that determines whether a ULCC continues to operate a route, or cuts bait and moves on.

The challenge is forecasting where this type of growth will take place – it can’t be done with any traditional mathematical model.

That’s because the decisions are based on subjective corporate strategies on the part of these ULCCs in regard to where they can get the highest and best use of aircraft.

There is no model that would have predicted Spirit’s expansion at Seattle. Or Frontier’s new capacity at Colorado Springs or San Jose. Or Frontier expansion at RDU.

As we illuminated last week, the entire concept of relying on historical DOT data is useless as a planning tool in this new air transportation environment.

Strictly Business. Nothing Personal. Because the objective is to offer an alternative spending option, the ULCC model is transient. If a given market doesn’t work sufficiently – or if another appears to be able to generate more revenue – the ULCC responds rapidly to shift resources. Read: pull out of town, and fast.

And when they do, most of the traffic they generated evaporates.

In fact, we’ve seen this clearly in the past. When Southwest opted to delete SRQ from the AirTran system subsequent to their merger, virtually all of the more than 300,000 annual passengers disappeared. They didn’t show up at Tampa or at Orlando or at Fort Myers… they were gone with the capacity. Same with the situation at Newport News – neither Richmond nor Norfolk got a tsunami of new passengers. It was simply gone.

It’s been in play for the past 18 months. ULCC markets with what would appear to have high load factors are suddenly dropped – because it’s now revenue-factors that count. We’ve even seen newly-announced markets dropped before they were ever started.

New Close-In Forecast Methodologies. The bottom line is that traditional approaches to forecasting are out. The future is based on determining where there’s potential for air travel to be a new discretionary spend product.

Join Us At The IAFS™ To Explore This New Future. On August 19-21, at the International Aviation Forecast Summit in Denver, this new air transportation future will be front and center in our discussions with airline and aviation industry CEOs and executives.

In addition, the Airports:USA® session on August 21 will be covering the new range of core trends that will change how airlines apply their resources, and the factors to consider in regard to making logical projections within an entirely new and evolving airline industry.

Airports: Bring Your Board Members… and maybe the mayor, too. This event delivers data, forecasts and perspectives that will give them a clear perspective of the future. Judging by a lot of the semi-ethical “ASD” schemes being peddled to unwary small communities, this event will assist in keeping civic leaders from being misled into the planning weeds.

Click here for more information and to register. We look forward to seeing you in Denver!

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April 9, 2018

Air Service Planning Assumptions – Unhinged

Traditional thinking. Historical experience. DOT-reported data.
And of, course reliance on what “everybody knows.”

These approaches are leading a lot of today’s aviation planning into the deep weeds. They’re the very foundation of most of what is passed off today as “air service development.”

And they are increasingly bogus in dealing with the future.

Traditional Air Travel Concepts Getting Ignored. In the past few weeks, air transportation news has been tush-deep in route announcements from ULCCs that represent outright burn-‘em-at-the-stake-heresy in regard to the accepted norms of air service planning.

Allegiant. Frontier. Spirit. They are directly standing counter to the norms we once held dear. The ones we’ve always found as bedrock planning. These airlines are being very disruptive.

Harrisburg-RDU nonstops… With A-320s?  Yikes! Or, Syracuse – Nashville? And more.

Nonstops operated with 160+ seat airliners just 2-3 days per work week?  And not even in leisure markets.

Goodness, whatever are these carriers thinking?

Friends and neighbors, these are absolute anathema to the sacred foundations of air service planning. No way there’s enough demand to fill those flying machines… we have the sources to prove it, right?

Quickly, let us repair to the sacred scripture – a.k.a., DOT O&D tables – and gain enlightenment to counter such ULCC blasphemy against accepted “air service development” norms. We all know that these data – coming from the deep maws of the federal government – are the horn of truth, right?

Relief! The data are beyond being clear.

See, as just one example, they tell us that there are not enough passengers reported daily each way between MDT and RDU to fill one and a half rows of seats on that airliner. Literally.

There’s A New Travel Paradigm – One That’s Consistent With Consumer Shifts. But these flights are coming, and they are not being scheduled by folks who just fell off a turnip truck.

What this represents is what Boyd Group International has identified as the new “unhinged” aviation future.

Here’s a fact: the traditional air service thinking, as well as accepted planning and forecasting methodologies, have become unhinged from the past. There is a new emerging air transportation market…and we’re seeing the start of it.

The Oracle At DOT – A Lot Of Smoke From Yesterday. Let’s start with this tidbit of iconoclasm:  DOT data is merely reflective of air transportation based on a set of complex factors, and determined largely by what airlines are offering.

These data have little to do with illuminating “demand” – because air travel is not like taking the rainfall in the Midwest and then being able to forecast the water flow on the Mississippi.

Air Travel: A Consumer Spending Option. No longer can air traffic forecasts be founded on the assumption that passenger levels are merely the caboose on the GDP growth train. We’ve been slowly unhinged from that since airline deregulation, 40 years ago.

True, GDP projections are the traditional way of forecasting. But it’s now completely outside of air transportation system realities. (Sorry, FAA. Your annual reports look very nice, but they’re the equivalent of a giant vacuum tube in a digital world.)

The number of consumers who will take to the skies, to the contrary, is based on a lot of variables, and DOT data only reflect (often imprecisely) the results of the travel channels that exist.

What that means is that the data are not reflective of what could be, should some fundamentals of air travel be shifted.

Shifted – like tossing day-of-week flights between mid-size cities within a region.

It’s Total Travel Time That Counts. Let’s consider this: air travel choices are made based on issues of convenience, cost, and – missed in a lot of the ASD schemes foisted on smaller airports – the travel-time factor, i.e., how long the total trip will take.

Like we’ve seen in failed attempts to bring local network airline service to places like Laughlin, Youngstown, Cheyenne, Naples and others, it’s the total travel time compared to alternative options that drives consumer choices.

It’s not the location of the local airport, either. A 60-minute drive to MCI from Topeka to get a nonstop flight is time-superior to shoehorning an itinerary to accommodate two local departures making a connection at ORD. Been there, done that.

That same overriding consumer dynamic can also apply to the attractiveness of new mission applications such as we’re seeing coming from Frontier, Spirit and Allegiant. The travel-time superiority is demonstrable, and that could override the concept of frequency. Whether the traffic will develop will depend on a lot of factors, but one thing is certain – past consumer trends are not indicative of the future.

Travel Decisions May Adjust To Superior Elapsed-Time Schedules. Let’s take the BNA-SYR market. There could be a lot of latent demand in that market, if the travel-time and cost factors were significantly better than the current hub-connect options. We don’t have any historical data to prove it one way or another.  It’s up to the consumer in each affected market.

And, we all assume that convenience drives a lot of the travel decisions. We assume that one or two weekly round trips won’t be convenient. Really? Compared to a circuitous connection over ORD?

What is to counter the argument that, faced with time-gobbling and expensive hub-connect options, consumer travel patterns – and business meeting schedules – might shift to accommodate the existence of a nonstop, low fare flight on Tuesdays and Thursdays.

This is not to imply that all of these new markets will be a success. But it is to say that there may be a whole air system developing. It’s what Boyd Group International has defined as the Parallel Airline Universe.

Get A Jump On The Unhinged Aviation Future. Enough talk. The fact is that we are at a major turn in the air transportation system in the US, one that addresses functional and time-barriers to getting between major points.

One that, carefully crafted and applied, may create enormous additional air traffic.

One that is completely unhinged from traditional thinking.

So, if you’re interested in getting up to speed on this, join your colleagues at the International Aviation Forecast Summit, August 19-21, and get the straight facts from the CEOs and executives driving this change.

We’re honored to welcome Barry Biffle, CEO of Frontier… Robert Fornaro, CEO of Spirit. Jude Bricker, CEO of Sun Country. Lukas Johnson, SVP of Allegiant. Plus Andrew Watterson, EVP of Southwest… and this is just part of the line-up.

We’ll have one-on-one discussions with these and other airline executives from across the globe.

Hosted by Denver International Airport, you can register by clicking here.

And bring your staff, too… it’s two days of solid data, forecasts, and new perspectives that no other aviation event can even get close to.

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And, Finally…

Annual Rite – The Annual Airline “Quality” Reports

Spring.

It’s when birds and bees get social. Flowers pop up out of formerly frozen ground. College students head to Daytona for all manner of on-beach rituals.

And, of course, we have the usual suspects in the media doing literary back-flips reporting on the latest airline “quality” reports.  No questions are ever asked about source data or the actual “quality” of the conclusions.

It comes from academia, don’t ya’ know.

Again, plan for some in the media to inaccurately and sloppily refer this stuff as a new “survey” – when it’s really just rejiggering DOT data – which any high school kid can access. Just put it through some type of mathematical formula, and, voila! we have a report. One that is postured to be strong research.

Not A Clue Regarding The Airline Industry Structure. Not much here, especially from a “quality” report that doesn’t know the difference between a “certificated operator” and an “airline.”  Point: it’s not of much value to consumers.

For example, regurgitating federal data regarding “bumping” rates on operators such as ExpressJet or SkyWest  – which mainly lease planes and crews to various major brand airline systems and which have little or no control over booking rates – is just ill-informed.

Which is where these tomes leave the consumer.

But, again, it’s spring.

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April 2, 2018

The New Realities of Small Community Air Access

Shock. Outrage. Denunciations.

That’s pretty much a description of civic leaders at communities where the local airport is now devoid of scheduled flights, due to the shutdown of Great Lakes Airlines.

They resemble Captain Louis Renault’s famous line in Casablanca. They are shocked!

Shocked to find local air service was headed into goodbye gear. They should have seen this coming, and they did nothing to deal with what caused Great Lakes to go under.

We’re talking about the Sacred Scripture. The Dogma of Truth, a.k.a., the 1,500-hour requirement for entry to the commercial pilot profession. It is the direct result (or more accurately, reaction) to the crash of Continental Express flight 3407 in 2009.

Nails In Already-Inevitable Air Service Coffins. This pilot-experience requirement is the direct and proximate cause of places like Prescott and Cheyenne now finding themselves with no scheduled passenger flights at the local airport, and even less chance of a major airline brand coming to town.

It’s also a reason that local airports at places like Naples, Topeka, Youngstown, and others may as well howl at the moon (instead of tossing money on more “studies”) in regard to attracting viable, long-term connective air service from a major airline system at the local airport.

One main reason is that local consumers at these cities already have far better air access options than what can be supported at the local airport. So not having flights at the local gates isn’t the major economic hit that civic leaders think it is.

The hard fact is that for airports such as these, the “pilot shortage” has only accelerated the inevitable, and put an earlier nail in the local air service coffin.

So, let’s call it for what it is. It’s not a shortage.

It’s the new economics of air transportation. It’s the new structure of air transportation in the US. Regionalization of air access was already an emerging dynamic – and now “regionalization” of pilot resources has accelerated this process.

A Rule With No Positive Benefits. The sad fact is that the 1,500 hour requirement is worshipped and aggressively-protected, regardless of the truth that were it in effect when the flight 3407 accident occurred, it would not have made any difference whatsoever to the outcome of that tragic night.

Both of the pilots of that aircraft had more than 1,500 hours, and this now-in-sacred-stone requirement in itself addresses none of the core findings of the NTSB report on flight 3407.

Regardless, the 1,500 hour requirement has become a third rail nobody dares touch, apparently. No other alternatives are to be discussed. Those that even suggest such things are burned at the stake of public opinion – they are the anti-safety, money-grubbing running dogs of greedy airlines.

Don’t Dare Criticize The Scripture. So, this is the situation, and the air transportation system will adjust. And constrict. It seems nobody wants to stand front and center and call for exploration of viable alternatives.

The now oh-so-outraged civic leaders decrying the demise of GLA should have seen this coming. Instead, they sat on their hands, not offering to help support exploration of alternatives to the 1,500 hour rule.
Most politicians avoid discussing it. One nudnik congresswoman actually stated that because there have been no fatal accidents since the rule was implemented, it proves it has increased safety.
Even a recent “task force” set up by the DOT to explore “solutions” to small community air service failed to take the 1,500 rule on. Instead, there were several pages that wallowed around suggesting other methods of meeting the rule, but not much along the lines of clearly stating that it needed to be completely reconsidered.
Constriction of Viable Air Service Demand. Loss of scheduled flights at points with almost no passengers isn’t a huge hit.

More damaging, however, is the reduced ability of major airline systems to access hub flows from midsize “small” airports, directly because they do not have sufficient pilot resources.

At extreme risk are airports with roughly 500,000 to one million enplanements. They have viable traffic, but their economies are threatened by the inability of major airline systems to adequately access this revenue due to limited pilot resources. This is a threat that local civic leaders can ignore at their peril.

Let’s state it. The 1,500 hour rule has not in itself increased air safety. But it is doing a great job of constricting economic growth and global access across the US.

There are better ways to be explored. But the discussions of such are simply not tolerated.

That’s the situation.

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March 26, 2018

China-US Tariff & Trade Issues…

Effects On Boeing & China-US Travel: Minimal

The Wall Street Chicken-Littles Are Very Ill-Informed

With a supposed trade war coming with China, Boeing’s in line for some tough times.

At least that’s what we are told.

The financial-sector gurus are out in full force, many predicting dire outcomes for China-US aviation as a result of the imposition of tariffs on certain goods from China.

We’re pretty much assured, according to the implications of some of the reporting, that the US consumer and the US economy are going to take it in the keester, because China will retaliate.

Already we’ve seen dire stories coming from other sectors of the economy… supposedly.

One financial media source recounted in an editorial how one small manufacturer has had to lay off staff due to the increase in steel prices, even though they supposedly were using US-made metal.

The bottom line was that, because underpriced Chinese steel was going away, US sources no longer had that price-pressure. Meaning, they didn’t have the market imperative to respond to unfair import competition.

But that wasn’t the take in the article… which curiously recounted something that supposedly took place within days of the announcement – not the actual implementation – of the tariffs on cheap Chinese steel. But the story was positioned as sort of the harbinger of things to come.

China & Boeing: This Isn’t Econ 101. It’s Global Inter-Dependence 401. Unfortunately, there’s a lot more to this than what’s coming from many of the Wall Street shamans, some of whom probably couldn’t tell “China” from a gift-set of Melmac.

The fodder of choice, it seems, tends to be dire warnings of this economic conflict hammering Boeing, and in the process zapping the entire supply chain, sending US workers to the unemployment line.

The Chinese, according to some of the supposed experts, can just switch to Airbus and leave Boeing bone-dry in the exploding China aviation market. Any look at production rates at Airbus would embarrass the folks putting this stuff out.

Or – watch the newswires, this one’s coming – the warning that China could just rely on buying indigenous airliners such as the C-919, oblivious of the fact that this machine won’t be market-ready for at least three years.

Indeed, these prognostications have reportedly caused Boeing stock to drop by over 5%, regardless of the fact that most of these stories are not based on hard market analyses… just Econ 101 assumptions.

Industry Expertise Not Needed. One financial media source last week actually warned that China has an immediate replacement for their orders for Boeing airliners. See, there are over 900 airliners coming off lease in the future, the story confidently reported, and then told the readers that China could simply “swoop in” and take those units in the place of buying new Boeing products.

Sure. Just pick’em up right off the desert showroom. No need to consider age, condition, engine configuration, airframe and component time, pending maintenance bulletins and a.d’s, maintenance bridging, compatibility with existing fleets, etc. Nor the fact that historically, China has not bought used aircraft.

But, such considerations are not important – nor is industry knowledge – when the goal is to fill several column inches.

It’s this type of veneer reporting that causes runs on stock prices… and misleads the public.

It’s not “fake news” – that’s when somebody actually knows the facts and reports something dishonestly different. This, however is simply irresponsible and amateur opinions represented as expertise.

Some Facts Not In Evidence. What a lot of this reporting doesn’t understand is that Boeing aircraft are global in scope. Parts, components and technology of their products come from all over the planet. While China is not a major direct sub-contractor for, say, the 787, Boeing does have a finishing center in China, and components for its aircraft coming out of the factory in Renton are certainly sourced in China by sub-contractors.

Another point: China is in need of lift. BGI’s Airports:China™ forecasts illuminate the fact that the domestic Chinese airline system is nowhere near reaching its stride in regard to meeting current demand.

The China market is such that there is no true US-style hub-and-spoke system, which takes passengers from several points and aggregates them on other flights. While on paper, it appears that there are plenty of options for connections at some airports, a closer review shows that today, the vast majority of traffic is between cities.

Aggregation between Mianyang  and Kunming isn’t needed. Just capacity. The vast demand between large commercial centers is a long way from being met… which means that China cannot economically afford to cut Boeing off… they need the lift.

It’s Boeing Or Loss of Economic Growth. Underscoring this, last week – amid all the dire shallow-fact stories warning about Boeing’s “problem,” China Southern confirmed orders for 30 more 737s, and Xiamen Airlines did the same for an equal number of units.

It’s unfortunate that so many of the folks in the financial media are simply not versed in the dynamics of the Chinese air transportation system. They just assume that the orders for new jets can be turned off and on.

Point Made: The two airlines noted above need the lift that these Boeings will deliver… and they do not have easy alternatives. They could cancel the order, but that would self-inflict huge economic damage to a nation that needs this capacity – as soon as possible.

Conclusion: The last thing China can afford is choking off Boeing. Airbus can’t fill the gap – not to mention for several Chinese Boeing operators, that would mean introduction of an entirely new sub-fleet, which is not an easy thing to do.

China & US – Partners. It’s Not Two Separate Markets, Anymore. Plan on this: The emerging Kabuki Theater between the US and China is not one where China holds all or even most of the cards. They are a producer nation – with @18% of their exports coming to the US. That’s a chunk of business they cannot do without.

Plus, some of the tit-for-tat tariffs proposed by China don’t make much sense within the inter-connected global economy. One example is the Chinese threat to put a tariff on pork from the US.

Oops, two little problems… pork is a major food item in China, and the supplies from the US are critical to that supply. Not to split hairs, but it’s China importing pork from the US, because it’s a needed food staple. So, it’s Chinese consumers who get zapped at the dinner table.

The second leeetle problem is that much of the US pork industry is now owned by, yes, Chinese companies. So, they get the short end, too.

Okay, What About China-US Passenger Traffic? We’ve seen where political disagreements have resulted in dictums from the Chinese government that have decimated the strong tourist traffic between China and Korea. And China and Taiwan.

This certainly could be an option in regard to retaliation for the US tariff program.

But, it’s not likely. First, the current channels of capacity between China and the US are essentially choked due to a variety of factors – one being lack of nonstops from interior Chinese cities, and another being the non-existence of a true hub-and spoke system that could develop more nonstops.

BGI Airports:China™ forecasts indicate that outside of Beijing, Shanghai and Guangzhou, the rest of China is generating less than 10% of the demand that can be expected with increased capacity channels. Regardless of actions to blunt Chinese from visiting the US, the demand is such that it would not likely be noticed.

Furthermore, the China-US relationship has progressed well beyond the simple tourist-group stage, which is the case with Chinese traffic to places like Korea, Taiwan and Thailand.

Between business travel and the demand generated by the @400,000 Chinese students in the US, passenger movements between the two nations is much more solid and fundamental that just folks wanting to take a vacation. It’s far from being just discretionary travel.

Don’t Buy Into The Financial Chicken-Littles. Boeing Needs China. But China Needs Boeing. China respects strength. The US is finally addressing imbalances in the trade relationship – which the Chinese government will rail about, but which internally they understand.

So, regardless of all the me-too stories about Boeing being in line for huge damage due to the US tariff moves, the hard underlying fundamentals show that this is one area that China will be very reticent to mess with.

Regardless of what the “experts” on Wall Street are telling us.

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March 19, 2018

Before We Start…

New Programs For Future-Focused Airports & Communities…

Boyd Group International and its China partners are now offering programs to assist airports and communities in attracting more of the burgeoning Chinese investment in the USA, as well as the 23 million Chinese leisure travelers coming here in the next five years.

As an example, we recently delivered a China air service and business symposium for industry leaders in North Carolina.

Sponsored by the forward-thinkers at Raleigh-Durham International Airport, the program presentation is available by clicking here… it gives perspective on not only the issue of new China air service to the US, but also the industry-leading research of BGI in regard to China aviation. No other consulting firm has be depth in this area as does BGI, including our Airports:China forecasts.

If your airport and community are interested in exploring the China opportunity, and gaining industry-leading expertise on how to optimize it, click on the China button above, or send us an e-mail to discuss your objectives.

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Air Traffic Control.  “Reform” Is Dead.

Actually, Reform Never Was On The Table

Based on what’s recently come out of the fog in Washington, US Air Traffic Control (ATC) “privatization” – which is mischaracterized and mislabeled as “reform” – is off the table.

That means it will be business as usual in regard to the Next-Gen naked emperor.

No changes, no accountability for failure or for implying that project failures are really successes.

Billions Spent… And Project Goals Slipping Into The Future. Yes, business as usual. The same ATC system that – even now with all those iconic vacuum tubes and old equipment already replaced – can’t handle current or future air transportation volume – will wallow on.

Any “improvements” in airline on-schedule reliability will depend on airlines continuing to shift schedules to allow more published sector time, and more turn time on the ground. An expensive concession to an ATC NextGen upgrade system that’s the poster-child of federal incompetence.

Note The Skies Are Not More Crowded. Do keep in mind that today there are 12% fewer airline flights in the sky than in 2007… that alone should have spiked “on-time” performance. It hasn’t.

Point: anyone awake, sober and with more than a grammar-school education can see that what’s gone on in the FAA in regard to ATC over the last 20  years has been a string of missed deadlines and pompous FAA Administrators getting away with it by telling swooning groupie-like network correspondents of how “successful” NextGen is.

Again, if NextGen were a private-industry program, funded by stock offerings, the leaders of this mess would be wearing orange jump suits.  NextGen is a fraud.

Sorry if this offends all the cognoscenti in the industry who line up behind NextGen like the rhythm guitar section of a third-string country band, but the truth and the facts are that the FAA’s performance in regard to ATC has been shameful and a failure.

When “Reform” Is Really Just More Expensive Status-Quo. But the truth is that the folks who called for “reform” actually were suggesting nothing of the kind.

They, too, were intent on keeping the status-quo, at least in regard to accountability and dimbulb management. Other than governance, there’s been nothing else mentioned. In fact, it’s obvious that the “reform” supporters also support the management system that’s responsible for years of missed deadlines and bungled programs.

“Reform” only meant shifting the ATC system to a privatized structure, governed by a board that would come from across the aviation spectrum. That, according to the lore, would make the ATC system run smoother – and run by the same incompetent management and the same misdirected programs that have hamstringed progress for the last two to three decades.

Funny, but this same industry “spectrum” of entities that would be directing a “reformed” ATC has a group have never – never ever – dared aggressively and openly called for any functional and complete reform of the ATC system.

Never.

They, apparently have been quite satisfied with the non-performance of the FAA, and seem to imply that just “privatizing” the program will lead to consistent funding and smooth skies ahead. The dogma is that it’s only been a lack of money that has held the ATC system back.

That contention is bogus. Wrong. Misleading. Not accurate.

Most of the GAO and DOT IG reports on NextGen have pointed to far more fundamental issues. Like, lack of clear objectives. Like, lack of strong direction and management. Like, NextGen not at all being “transformational.”

Take a gander, nobody on either side of this embarrassing Kabuki Theater has ever come out and called for any “reform” in regard to decades of missed deadlines and bogus goals.

None were, and none are, being planned.

The Anti-Reform Segment Wasn’t Focused On Demanding Results, Either. But as far as any fundamental changes, it makes no difference.

Remember, most of the entities that were against this “reform” only focused on the supposed disaster for rural communities if greedy airlines got their paws on the ATC tiller. Regardless of whether that fear was valid or not, the fact remains that the amen-corner for status-quo has been silent in demanding that the creaky management directing NextGen be advised to find a new set of careers.

Truth be known, “reform” – as curiously defined in this matter – is dead. As defined in the real world we all live in, it never was a proposal.

Both sides really wanted the same outcome… keeping the functional status quo, and shielding the FAA from any accountability for NextGen failures.

Move on, everybody, nothing to see here.

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March 12, 2018

Definition: Unhinged

uhn-hinjd

Unstable, off-balance, uncertain, disconnected from past options,
Disoriented, confused regarding situational changes
Also see: Aviation Future Planning

Today, with all the emerging and fundamental shifts in the industry, it’s a fact… traditional planning approaches are, by definition, coming unhinged – i.e., disconnected from the emerging aviation industry.

Many of the traditional approaches and planning options have little or no bearing on the new emerging dynamics that are engulfing the industry. They are galaxies away from what’s unfolding in aviation.

Join Aviation Leaders At the IAFS™ And Get Whole New Perspectives.  On August 19-21, the decision-makers in the industry will be candidly exploring the new structures of aviation… big changes in the works.

Let’s take a look at just a couple of areas…

US Air Transportation System & Structure – one major change is the Parallel Airline Universe – a.k.a. ULCCs (Allegiant, Frontier, Spirit, Sun Country) – they’re expanding with marketing models that are completely contrary to what were in place three years ago.

Running periodic but high-density flights between places like Nashville and Richmond, or Philadelphia-Grand Rapids or Memphis-Oakland, with price intended to trump frequency, is an approach not seen before.

Face it, the competitive issues this represents to the four major network incumbents are, yes, uncertain and  disconnected from past options. Unhinged from past experience.

And just offering another bare-bones-you-board-last-and-don’t-get-overhead-space fare bucket isn’t likely going to be a meaningful competitive response.

By the end of 2018, the Airports:USA™ forecast from Boyd Group International indicates that ULCC capacity will be in excess of eight per cent of the US total – a very disruptive factor… one that unhinges traditional competitive options and unhinges the traditional definition of “air travel” from meeting a need, to providing a consumer spending option.

The problem is, the two different models are on a collision course.

Traditional competitive responses are not going to be effective. Pulling otherwise-expected service features to implement another low-fare bucket is problematic. Adding an optional fee to get into a “priority boarding” line that starts to build an hour before departure, and can stretch 80 or more people down the hall, isn’t necessarily a strong response, either.

In regard to competitive responses to the Parallel Airline Universe, most of what’s in the traditional book of service options is out of date. Unhinged as solutions to the current challenges.

Small Community Air Access. Take a look around. Let’s tell this just like it is.

Nowhere is traditional aviation planning more “unhinged” from today’s realities.

There are probably dozens of small communities trying to restore or add to “air service” at the local airport, when the new economic structure of the airline industry – and consumer preferences – now make a lot of these efforts akin to latter-day cargo cults. (Google it if you need.)

But even though the realities – and the emerging structure of the air transportation industry – are crystal clear, many communities are still squandering money on “market studies” and “drive analyses” and “task forces” to “find more airlines” when, like in the case of South Pacific cargo cults – nothing’s coming.

In the context of the emerging air transportation system, and its role as part of the communication system, a lot of these efforts – some quite costly – are the equivalent of voodoo.

In short, the approaches to assuring access from the rest of the global economy can no longer focus on just having flights at the local airport.

The traditional methodologies of just collecting lots of data – much of which are often nonsensical assumptions – will not create a connective airline industry that no longer exists. Building a stick model of an airplane and putting at the end of the runway will be just as effective.

Save The Tuition. Another  giant waste of money is sending staff to attend generalized “training classes” that purport to represent that “air service development” is just a matter of doing the right data, and airlines will come a-running. Today, there is no drive-up window for air service, and just doing all the “right” analyses won’t bring them to town. The structure of the US air transportation industry is no mystery.  Jive training that covers lots of past hypotheticals that have zero relationship with the US system is useless.

Point: traditional “ASD” approaches like this are on another planet from the future, instead, they are unstable, and functionally disoriented… i.e., unhnged from the new realities.

Fleets & Fleet Applications. Standby for huge disruption here. The traditional service models and applications of long-haul international air service are in for a total revision.

First, the days of the small “regional” jets are still limited. Changes in fuel costs and a near-boom in US travel demand have slowed retirements. But, make no mistake… they are getting older, and the next step up on the fleet chain is going to be most unpleasant for a number of local airports.

These communities need to move away from chasing elixirs and magic that are unhinged from an air transportation system and consumer preferences that are fundamentally different from just ten years ago.

Second, there are enormously disruptive new airliners in the pipeline. The 787 was just a minor taste of what’s coming.

At the 2016 International Aviation Forecast Summit, held at Reno/Tahoe, we showcased the new Boom Technologies 45-50 seat supersonic airliner. At the time, the usual cognoscenti advised us that since the Concorde (which rolled out when Gunsmoke was the #1 TV show, and smoking Raleighs for those valuable coupons was the in thing) didn’t work, that meant that this new airplane was also doomed.

Today, the Boom Technologies airliner has over 130 orders, and support from Japan Airlines, Virgin, and several major component suppliers…

The unhinged effect of the Boom Airliner is that it will – will – have the effect of functionally moving the high-yield business/first customer segments off of the front ends of 777s, A-350s, and A-330s.

Then, we may want to get into the issue of new powerplant technologies… maybe.

Regionalization.  Reality is only starting to hit some mid-size regional airports. The traditional do-a-study-lure-an-airline-to-a-new-route approaches are now largely disconnected from the past… unhinged.

The fact is that changes in fleets and raw economics have laid bare the nonsense foisted on many airport that if they want certain new service, it’s just a matter of reaching out for one of the faceless many airlines out there.

One Midwest community recently touted that it had over 31,000 annual O&D in the Boston market, and therefore, it was a slam dunk to “lure” an airline into nonstop flights.

The fact that this number – if all were boarded on a single flight – represents less than a 50% load factor on the smallest airliner of the only (and not identified) airline that could have a snow cone’s chance in Havana of even considering such a route. Apparently, that part of the “route analysis” was somehow left out.

Point: this example is not rare, anymore. Traditional air access planning is increasingly devoid of any relationship with new air transportation realities… it’s unhinged.

Internationalization. It was Boyd Group International in 2008 that first outlined the value of internal, non-hubsite US airports to EU carrier systems.

Today, that trend is well underway. Nashville, Indianapolis, Austin, New Orleans… and more. Plus, Boston even now has nonstops from China.

What this represents is the need for every mid-size and large airport to become more internationally-focused. No, nonstops to Heathrow aren’t in the cards for Ithaca… but access-planning for effective connectivity to US gateways is a future imperative. (One, by the way, they are pursuing.)

Join Us In Denver & Get A Grip On The Future.  It’s a new aviation industry – unhinged… unstable, unplotted, un-experienced, and yes, confusing.

But it’s reality – and that’s what we’ll be exploring at the International Aviation Forecast Summit – no wandering “panels” – instead, sessions that will illuminate the future.

We’ll be discussing the unhinged future with airline CEOs, aircraft manufacturers, suppliers, and financial experts… uncovering what aviation will emerge into in the coming years. If you can attend only one conference this year, the IAFS™ should be the one.

If you’re not registered, click here for more information and to get the early registration rate.

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March 5, 2018

Before We Start, An Exciting Announcement

Southwest Airlines Joins As Platinum Sponsor of The

International Aviation Forecast Summit

Airline Industry Leaders To Be A Key Part of the #1 Industry Event.

We are honored to announce that Southwest Airlines will be a platinum sponsor of the 23rd Boyd Group International Aviation Forecast Summit.

Andrew Watterson, Executive Vice President & Chief Revenue Officer, will be joining us at the Summit, and outlining the new aggressive directions of Southwest. He will be joined by several other staff from Southwest, too.

This year, the Summit will again eclipse any other aviation event for insight and futurist perspectives.

We’ll be hearing from senior decision-executives from across the entire aviation spectrum… delivering new perspectives that won’t be found at any other aviation event. Perspectives that can improve and hone long-term planning, regardless of the sector of the industry you’re in.

Where Are Airlines Headed In The Future? … Join Us & Hear It From The People Making the Decisions.  As the name implies, the Summit really is all about forecasts – trend projections, traffic growth, fleet shifts, and airline strategies.

One of the key areas we’ll be addressing is the major changes to the US air transportation system due to massive increases in expansion of ULCC service.

Boyd Group International has defined this new dynamic as the Parallel Airline Universe – because the basic model is one founded on very different business objectives from traditional airline planning.

More and more, the objective is to position air travel as a consumer spend option, right along with other discretionary options. This means the traditional air service planning approaches need to be materially revised. It also means that traditional views of “air service” can no longer be approached as in the past.

More Industry Leaders – More Business Intelligence. At the Summit, we’ll be joined by Barry Biffle, CEO of Frontier, Robert Fornaro, CEO of Spirit, and Jude Bricker, CEO of Sun Country – and these are just for starters. And if you’re looking for networking, the IAFS hosts more airline planning and management staff than any other event.

For more information on this #1 aviation forecast and networking event, click here, and register while early rates are still in effect.

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Revision: Third-Quarter 2018 –

Stronger Enplanement Growth Forecasted

The strengthening economy is translating in to stronger traffic growth.

A revised Airports:USA enplanement forecast indicates that we will see 2018 trending toward 3.9% and 4.4% growth in the third quarter, and the potential for as much as 5.2% in the last three months of 2018.

But, as we forecasted earlier, the growth will be uneven, and accompanied by huge percentage spikes at some mid-size airports.

Comparing capacity plans for the third quarter of 2018 v 2017, the US airline industry will be adding just over 4.2% more seats… but that’s not the same as “more capacity” spread over a static traffic demand flow.

The Traditional Airline sector will continue to see measured growth, some of which will be the result of fleet changes.

This will also be accompanied by rapid percentage expansion of the Parallel Airline system as it moves to position air travel as a discretionary spending option.

Separating the two models, and looking at the third quarter of 2018, the Parallel segment is planning strong percentage expansion, but it’s not “excess capacity” that some Wall Street dwellers fear, because it’s mostly on routes that have little of no nonstop service, and where the fare will determine the “demand.”

It’s putting airline seats on the consumer shelf, competing with Home Depot more than with United, Delta, American or Southwest.

In the third quarter of 2018, the three Parallel carriers will account for almost 7% of total US capacity – but it will be mostly in markets that are not directly competitively-aligned to take share from the six traditional-model carrier systems.

In most of the recent expansion announced by Frontier, for example, it’s clear that they are after developing new consumer flows, instead of invading existing ones.

Another Player Expected. Note that this data does not include Sun Country, which is expected to enter the fray aggressively by the end of the year.

For now, this represents low competitive threat to the traditional airline model, because it’s not just new capacity tossed on top of existing seats, as some in the financial world are contending.

Get Ready For Disruption – Particularly At Mid-Size Airports. It’s  also very clear from the track record of the last 18 months that the Parallel Airline system is fluid… if a new route doesn’t develop quickly, the airline goes into goodbye gear.

Islip (which, by the way, is no more an access point to New York City than is Allentown) has seen this in spades in the last year.

Remember, many of the expansion routes these Parallel Airlines are entering are strictly Captain Kirk territory – where no airline has gone before, at least in the last decade.

Join ULCC Leaders In Denver, August 19-21, And Hear It From ULCC CEOs. At the International Aviation Forecast Summit this August, we’re going to be discussing this new model – and how it will evolve as a core part of the air transportation system – directly with the CEOs that are driving it.

No rambling boring panels… just direct interaction with the thought-leaders that will shape the future.

The IAFS delivers forecasts and business intelligence that eclipses any other aviation event. Data and information that relates to the real-world and that delivers the competitive planning edge for all sectors of the industry.

Click here for the latest on the International Aviation Forecast Summit, and to register at the special early rate.

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February 26, 2018

The Seat Size Controversy… More Inaccurate Media Reporting

This past week there were a couple of stories on how some of the inhabitants of congress want to pressure the FAA into legislating seat dimensions.

To “fix” a problem requires having a knowledge of the problem. That’s not the case here.

There is no question that seat “pitch” – simply put, space between rows – has gotten much tighter in the last 20 years… particularly in the last five.

But that’s not the same as seat-width, which truth be known, has actually – on average – grown in the last 20 years in US skies.

Don’t Check The Source – Especially If It Agrees With The Reporter’s Pre-Conceived Conclusion. These articles are often embellished by the oh-so-righteous statement that seat-width has also shrunken from an average of 18.5 inches a few years ago (whenever that was) to an average of 17 inches today. The articles then attribute the source of this statistic to one consumer group or another…

Fake news lives. It’s a flat-out false statistic, at least for US airlines.

Here’s a fact to ponder…. In the US, the smallest seat width in economy cabins at US airlines is 17 inches. (This does not include any smattering left of air taxis or third-tier carriers flying very small aircraft.)

That’s the smallest, and in the US it is found only on categories of “regional” jets.

New Airliners Have Changed The Mix. Let’s take a look …despite what some media sources mis-report, the B-737/757 has exactly the same fuselage width as the first 707s that entered service in 1958.

The cross-cabin seat density in normal economy has always been six… so shrinking the width of the actual seat would gain nothing in regard to more passenger density. It’s been around 17.5 inches since 1958. So even if it were originally at 18.5 (which is bogus), there’s no way shrinking the width would deliver more capacity.

Most of the reporters who spread this inaccurate drivel have no clue of the subject matter.

In fact, there has been some increase in seat density on some widebody airliners, but none in US operation are less than 17 inches wide.

(For the record, airlines have tried different seating configurations… in the 1960s, United dabbled with a second economy cabin with 5 across, It didn’t survive.)

Actually, the average width of the US economy seat has grown in the past 20 years. The expansion of the A-320 family actually has increased average tush width in US economy cabins… they have an average of 18 inches. The Embraer E-170/190 airliners have seats at approximately 18.2, and the new CSeries coming on line at Delta will have some seats at 19.

So here’s the bottom line… since the narrowest seats in US fleets are at 17 – and these are just on smaller “regional” jets – and virtually all other narrow-body airliners in US skies are above that, it doesn’t take an advanced degree in fractal geometry to conclude that the “average” today simply cannot be 17 inches.  The pandering consumer groups and the reporters who blindly rely on them have a credibility problem.

Simply put, the consumer gadfly organizations and their media groupies are passing out bad information. One wonders about the accuracy of the rest of their reporting. The congressional inhabitants who might repeat this garbage are in the same category.

So, the folks that are reporting a decline in average seat width – particularly in narrow-body US fleets – need to do some homework. Or find another profession.

Again, this is not to imply that seat pitch hasn’t declined.  It has.

But the story demands facts, not innuendo.

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BGI Delivers China Symposium At Raleigh-Durham

The Boyd Group International/China Ni Hao professionals were honored to be teamed with the Raleigh-Durham International Airport to deliver a comprehensive Symposium to North Carolina industry, civic, and government leaders, outlining the opportunities for China air service.

With the enormous Chinese business investment in the region, including Lenovo, Tencent, Smithfield Foods, and Triangle Tires, the North Carolina Research Triangle supports over 160,000 annual air travelers from China, according to BGI’s Airports:China forecasts.

The objective of the Symposium was to illuminate the realities of gaining nonstop access to China, which today does not yet have a fully-developed hub-and-spoke system that compares to that in the US. Indeed, today, the largest single airline operation is the China Southern system in Guangzhou, which is in southern China. It has @ 350 daily flights… compare that to some US connecting hubs, with between 600 and 900 departures.  This will evolve in the years ahead.

In the meantime, there’s lots of aggressive planning and outreach that needs to be pursued by US regions and airports to meet the China future.

At the event, BGI staff outlined the future evolution of the Chinese airline industry as it will affect RDU, as well as key data regarding where the communities of business interests will develop between North Carolina and China in the coming years. BGI is the leader in China-US air traffic and trend data,

We were honored to work with the team at RDU to deliver this program.

The China Era Is Here – And It’s An Opportunity for Regions Across America.

We would note that Boyd Group International and its team of China experts stand ready to assist communities and airports in developing aggressive China-Welcome programs.

Welcome & Wayfinding Programs – Chinese leisure and business visitors will prefer and gravitate to locations that make an effort to welcome them with basic but professional materials such as key communication touch-point signage, and making certain parts of the venue fully China-Welcome…

Professionally-Created Chinese Support Materials. BGI can craft a tailored program for any venue to assure that Chinese visitors – particularly business visitors – have the materials and informational guidance they need to have an anxiety-free visit, and to know that their hosts respect their business…

Local China-Welcome Outreach. If you are relying on machine-translated versions of your website and promotional documents, delete them immediately! They are usually very sloppy, inaccurate and in some cases offensive. Let BGI’s experts develop and create the message professionally…

Digital Outreach. BGI’s team has established WeChat, Baidu and other digital programs for US companies and organizations. We can literally put your airport or community in the pockets of millions of Chinese consumers…

China-Welcome Programs. Just as at the North Carolina Research Triangle, BGI can deliver incisive and informative programs on-site, designed to inform and fire-up the region to become more competitive for the billions in China-US investment and the more than 23 million Chinese leisure visitors expected to see the US over the next five years.

Point: If your region is interested in looking to the China future, we’re ready.

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February 19, 2018

Make Security Incompetence Great Again!

Let’s Toss More Money At The TSA

The airline industry alphabet groups are on the warpath…

They should be. The Administration is proposing to add more ticket fees to fund the TSA.

This is essentially the same as tossing the money down a rat hole. Maybe worse… at least the rats could make a nest of it. The TSA management is a national embarrassment.

The management of the Transportation Security Administrarion has been a consistent embarrassment, right from the start, when the first TSA Administrator spend a reported $400K right up front to redecorate his office. Then the millions spent on screening devices that the TSA ultimately had to pay somebody to take away as scrap. And the proposed 16,000 staff is now well over 60,000.

Then the reported 80% to 96% failures in screening accuracy – which the TSA tries to keep secret, and which is just taken as a blip in what they call “layered” security.  Layered like a roll of Charmin.

Message To The Oval Office: What the TSA needs is a complete floor to ceiling management clean-out. They don’t need more money.

Surprising. As a tough businessman who is known for demanding results, it is incredible that Trump would support more consumer dollars diverted to a bureaucracy that is famous for incompetence.  Like out-of-control spending, no accountability for failure, and no comprehensive anticipative “security” beyond screening for pointy objects.

The same Administration that touts how a new tax program will put more money into consumer spending now wants to hit up airline passengers to give some of it back… without any justification.

Media reports indicate that some of the inhabitants of the Marble Playpen, a.k.a. congress, are thrilled with the proposed fee, because it’ll buy more whiz-bang airport contraptions that’ll weed out more proscribed items in carry-on luggage.

The fact that incidents such as the baggage area shooting at Ft. Lauderdale and the electrical failure at Atlanta prove that the nation has no cohesive and professional post-event security and crowd protection whatsoever, isn’t a concern, apparently.

Paying For Things Make Sense… Unless They’re Losers. This whole TSA issue runs counter to several otherwise-valid points made by the Administration:

Strong arguments can be made for increasing the PFC cap – because those bucks are tightly controlled and are 100% beneficial in funding logical infrastructure.
Strong arguments can be made for curtailing much of the Essential Air Service program… which is mostly funding flights that have no utility at all and which consumers won’t use.
But the willy-nilly suggestion to add more fees for a bureaucracy that’s proven to be a financial and administrative cesspool is nothing short of irresponsible.

And misuse of taxpayer dollars.

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February 12, 2018

And You Thought Twilight Zone Was Off The Air…

“By all legal means.”

This is the vow made by a lawyer in regard to getting justice for his young student client, who, he claims, was dreadfully treated by Spirit Airlines.

Seems that at the airport, it’s alleged that the airline told the kid that she couldn’t take her “emotional support” hamster on a flight. Compounding this outrage, the kid claims that the airline advised her to flush the dearly-loved rodent down the toilet

Which, she admits, she dutifully did.

Now, the media has run with this story – in most part because it’s so outrageously stupid. But beyond this specific incident, the stories are rife about “emotional support” animals – birds, pigs, rodents, lizards  and whatever else might be found in a re-run of River Monsters – being passed off as necessary to the passenger’s well-being.

In this politically correct world, a lot of the media really is reticent to go through the stupid criticism if they cover it directly as the silly nonsense that it represents… not to mention the fact that it’s a ridiculous story in the first place.

If somebody needs a peacock to travel emotionally under control, it’s not a trip to Miami that he or she really needs. Besides, legroom is short enough without having an emotional support python curled up in front of 13B.

In this case, between the student, the lawyer, and the (very few) media reporters who actually think this is serious stuff, it appears that the only player in this mess that might have had a clue ended up going down the loo.

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The Parallel Airline Universe –

Quantum Expansion. Quantum Disruption of The Status Quo

The game is on… the parallel airline universe is growing.

Frontier just announced a massive expansion across the US… low fare, point-to-point flying involving mostly non-hubsite, mid-size airports.
Spirit last week switched a 20-unit order for A-320NEOs to sooner-available A-320CEOs.
Sun Country is making moves in the same direction as Frontier and Spirit
The US air transportation system is changing fundamentally.

Note that most of the markets just announced by Frontier are not all in direct competition with the First Universe. RDU-BUF, and CHS-AUS were not likely at the top of the in-boxes at American, Delta or United… nor will they be anytime soon. This represents a major new direction in air transportation in the US.

This also represents using high-density narrow-bodies to stimulate traffic between secondary, mid-size commercial centers.

Message To Wall Street: Developing New Revenue Is Not “Over Expansion.” These new strategies on the part of both Universes point to a situation where the outdated Wall Street definition of “over-capacity” gets tossed into the trash bin of history. There are no dynamics in play that rule out that the type of expansion by the Parallel Airline Universe won’t be not only successful, but also actually additive to total air transportation ridership.

Naturally, no guarantees, but the knee-jerk denunciations from the financial gurus that any capacity additions are bad for the industry should be taken within this new context.

The Magic Studies Are No Longer Needed. There’s another clear indication coming from these expansions on the part of both Universes… they know where they are headed, and outside input is increasingly a day late and a fleet-announcement short. The concept that airline planners are sitting in lonely cubicles waiting for some consultant’s magum-opus “market study” to give them some sense of direction is dead.

These latest expansion moves were generated entirely within the confines of the carriers themselves.

The days of a consultant marching in with a 60-page boiler-plate compendium of charts and graphs that will have any effect on airline planners are over. They are making their own decisions, and it’s fantasy that doing a regional “survey” or “drive analysis” will materially shift their planning.

Today, for any community, the approach must be to first identify the carrier’s specific strategy, and determine if a market makes sense or not for them. The starting point is the carrier’s strategic direction – before tossing $30K at a generic study. Or doing a blind 20-minute session at a speed-date event.

Come Hear The Facts From The CEOs Making The Decisions. At the 23rd Annual International Aviation Forecast Summit, we’ll be exploring the new future of air transportation in America.

We’re excited that the CEOs of Frontier, Spirit and Sun Country will be participating and presenting their views of how the airline system will evolve in the next five years. And, we’ll be exploring the views of the First Universe, with executives from carriers across the industry and across the globe.

This year, the Boyd Group International Airports:USA forecast session will focus on how this emerging air transportation system will directly affect community air access… the concept of regionalization will expand, and there will be shifts in consumer travel patterns. Get ready for projections and trend analyses that no other event will even get close to.

There’s lots more to the IAFS this year – the range of futurist business intelligence represents the competitive edge for every sector of aviation.

We’ll be covering new concepts – new aircraft, new international traffic flows, new consumer directions, the effects of changes in communication channels on air service, and much more.

Before committing to any other aviation event this year, check out the IAFS. Our regular attendees will tell you that it delivers more insight, more actionable data, and better networking.

To register and find out the latest on the IAFS, click here … and join your colleagues August 19-21 in Denver.

Also, we’re planning on announcing some exiting related events on that week-end that will make your visit to Colorado and the Mile High City a very special event.

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February 5, 2018

The US Air Transportation System of 2028

Preparing For The Future Means First Accepting It

One of the biggest challenges to the future is accepting the fact that the future is the sum outcome of a wide range of anticipated and episodic changes in the economic environment.

Many of them uncomfortable and disruptive.

Unfortunately, the result of trying to avoid the discomfort of change is today demonstrated in the fact that much of the nation’s infrastructure planning is based on what was needed for yesterday and today’s economic systems.

As Boyd Group International has pointed out, our entire communication systems have changed over the past 30 years, and that includes the air transportation channel.

Unfortunately, this reality is too often totally ignored.

Take a look at rearview mirror boondoggles like “high speed rail” that – in most proposed applications – tend to ignore just about every earthly reality – evolving consumer travel patterns, cost issues, alternative emerging communication trends, and the realities of a political system that spends first and asks intelligent questions later.

Moving to aviation – let’s look at today v ten years ago… we compare the US airline system in 2018 with that of 2008. It’s different.

The trends are clear and obvious… yet much of the “ASD” programs currently seen are oblivious… they assume the past is just the same as the future.

Regardless, the fact is that the entire air transportation system is fundamentally different from just ten years ago.

The multi-fleet, full-network systems – American, Delta and United – have consolidated into larger aircraft, and fewer departures. The rest of the industry is also evolving into larger units of capacity, including the parallel airline universe represented by Allegiant, Frontier, Spirit and Sun Country.

Economics, changing consumer patterns, reduced value of intra-regional air service, new fleets, and the emergence of alternative communication systems, have structurally changed air transportation’s role in the US economy.

So, where will the system evolve in the next ten years?

Let’s Fast Forward Ten Years And Look Back. At the 23rd International Aviation Forecast Summit, August 19-21 in Denver, we’ll be exploring this. We’ll be looking at the expected fleets that will be in operation in 2028, based on not only BGI forecasts, but those of the major manufacturers.

We’ll be looking at issues such as the emergence of new-technology propulsion systems, such as hybrid and electric. We’ll again have Ben Brockwell of OPIS, the leading expert in fuel trends, at the Summit to deliver his company’s often iconoclastic but usually accurate projections of how oil prices will redirect air transportation.

Most importantly, we’ll be exploring the one factor that most ASD studies avoid – changes in consumer travel and communication patterns that we can expect by 2028. Just as the last ten years have changed air transportation, you can be assured that by 2028 things will be fundamentally different – and disruptive.

This is the type of no-holds-barred data and forecasts that has made the Summit the most prestigious event in aviation. Leaders don’t go by the book – they write the book, and this defines the attendees at the IAFS.

So, if you are planning for the future, join us and industry decision-makers from around the globe in Denver this August. Regardless of the sector of aviation you may be in, the Summit delivers insight and perspectives that are available at no other event.

Click here for the latest on the IAFS and to register.

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January 29, 2018 Update

To Start Off This Week…

Just two days left for the New Year’s Registration rate for the 23rd annual International Aviation Forecast Summit.

This year will be the most comprehensive and most valuable ever. Whatever sector of aviation you’re in, the Summit delivers the insights and perspectives you need for the future – right from the industry decision-makers.

We’re glad to announce that Barry Biffle, CEO of Frontier will be joining us this year, adding to the distinguished array of discussion sessions and forecast segments.

We are also planning some very exciting special social events for the Summit.

With the New Year’s rate, the Summit – which delivers information and perspectives from leaders across the industry – is actually less than what some second-tier “speed date” events are charging.

So, click here and register – join us in Denver August 19-21 and get ahead of the competition.

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Wall Street & United Expansion Strategy:

… Chicken Little Lives!

“Because that’s where the money is.”

According to lore, this was the answer when a reporter asked 1950s hold-up man Willie Sutton why he strictly targeted banks.

It’s also the answer that United Airlines is accurately and candidly delivering when people from the financial world angrily demand to know why the airline is currently “adding capacity” with new or expanded service to mid-size (not small, by the way) airports.

It’s unfortunate that the money-gurus aren’t listening to the answers.

If they did, they might see the future. But right now, the trendy thing is to babble about the evils of adding “capacity.”  Any increase is like letting anthrax in the financial door, to hear what these gurus are saying.

But the truth is that the apparent strategy of UA is far more connected to emerging realities than what’s being expressed in many analysts’ reports.

Let’s take stock…

The year 2017 was a banner year for air travel in the USA…

Airport enplanements went up over 3.3%. But it wasn’t across the board.

Air access in 2017 continued to regionalize, with many smaller airports experiencing the realities of airline economics (read, loss of service that was unsupportable) as consumers opted for more total-time-efficient itineraries at larger airports… many of them “mid-size.”

The proof of this is demonstrated by the record (and near-record) enplanements at over three  dozen (and counting as 2017 data comes in) mid-size airports, from Des Moines, To Norfolk, To Missoula, to Boise, to Kalispell. Add in Bangor, Scranton, Traverse City, and Fort Wayne. For starters.

Load factors are high, yields are stable, and the traffic growth is organic to the airport. There is core traffic demand at these points – almost all of which are at or well above filling more than 80% the seats leaving the gates. Mid-size airports is where the growth is.

So, for network airlines, it’s also where the money is.

In addition, the four major network carriers – American, Delta, Southwest and United – all registered load factors at their hubsites that represent what Boyd Group International defines as “hub-choke,” based on current capacity. There is a lot more revenue out there, and carefully adding more spokes to their connecting hubs will access it.

That is exactly what United is doing… because that’s where the money is.

So, the trends are obvious… passenger demand spiking at midsize airports, plus hub capacity maxed. Legitimate organic demand at many mid-size airports is exceeding capacity.

United is going after that revenue opportunity. Because that’s where the money is.

When their strategy is analyzed in the context of the emerging dynamics and economics of the air transportation business, it makes enormous sense. It tracks with the consumer trend of regionalizing air access into mid-size airports.  It is aimed at maximizing system revenue.

In addition, these new revenue streams make United more formidable in dealing with the ULCC model, which is entirely one that depends on point-to-point traffic, mostly in high-density markets, and dependent largely on stimulating impulse demand.

Let’s bang on the financial industry’s cage. Here’s a fact: United Airlines faces a lot more strong domestic growth opportunities than it has airplanes.

The data are obvious, and United’s strategy is sound business.

But, the “experts” are in a tizzy. To listen to these people, they are misrepresenting that United is just tossing more seats on top of what’s there already, which, supposedly will lead to a situation where United will need to slash fares to sell them.

In the context of airline industry and consumer trends, that conclusion is garbage. Trendy, but still really off-the-bubble nonsense.

The problem is that many of these self-appointed gurus on Wall Street think that an airline ASK/ASM is just another product that has to be sold inside some single giant seat store. So, according to their Econ 101 textbook, the more capacity produced, the danger is a massive fare war.

Fantasy land.

For the financial industry cognoscenti, jumping on this stuck-in-the-mud band wagon is now the thing to do. Denouncing United, the comments from the usual suspects in the stock-and-paper world resulted in a hit to United’s stock price.

“Warning, Warning! This is not a drill! The sky is falling, and United Airlines is the one pulling it down!”

Here’s a typical comment from the all-knowing media…

“… United said it expects to increase capacity between 4 percent and 6 percent in 2018, adding it sees a similar growth rate in 2019 and 2020. This move could impact United’s profit margins as it tries to compete with lower fares offered by competing airlines as it will have to pay to operate those flights or potentially offer competitive fares to entice passengers on board. It could also lead other airlines down a similar path…”

Hello earthlings tied to hard reality. These conclusions are uninformed nonsense. These suggestions of “over capacity” have no – zero, nada, zip, mei-you – relationship to the context of what United, and to a lesser extent, American, are doing.

What United is pursuing is strengthening its revenue streams, which is very different from willy-nilly putting out seats that will need to be sold at fire-sale prices. Yet that’s the myopic babble coming out of some of these august financial houses.

In the above quote – actually it’s from one of the otherwise most professional financial media outlets – the comment about having to lower fares to “entice passengers on board…” is the leper’s bell of a report that has no connection to today’s airline industry.

To imply this – without any analysis of where and how United is expanding –  is simply monkey-hear, monkey-say reporting.

Suggestion: Tumble To The Fact That There’s A Revenue Side, Too. Here’s a factoid – just about every new hub-spoke United is adding is at an airport where ambient load factors are over 80% – in many cases, well over that figure. When that happens, it usually means that there is additional – and revenue-viable – traffic demand.

In short, it’s where the money is.

Furthermore, this program will strengthen United’s competitiveness v the ULCC model. A feed flight from Norfolk will deliver more traffic through Denver, and free up additional seats on their now nearly-full Norfolk-Chicago flights (over 85%) to a hub operation at ORD that’s also at 85% capacity.

This is not excess capacity… it’s sound market planning. And, yes, it’s where the money is.

Point: the lemming stuff coming out of the financial industry isn’t expert advice, by a long shot.

Soild Planning. Regardless of Kibitzing From Wall Street. In a rational world, inhabited by “experts” that really understood the airline business, the program at United Airlines would be lauded, instead of getting knee-jerk responses from people in the business of commenting on how they can move stock prices.

That’s a blunt statement, but it’s accurate.

Conclusion: The stuff from the alleged financial experts is off-base. United is pursuing a well-planned and professional strategy that will benefit employees and shareholders.

They apparently are running an airline for the future… not for tomorrow’s closing bell.

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January 22, 2018 Update

US Air Service Policy & High Speed Rail…

A Lot In Common, Besides Ignoring The Future

In various media stories this past week, there were a couple of nasty wake-up calls in regard to US communication planning for the future.

Passenger transportation is part of the communication system, but today it’s still considered anything but. Every other mode of communication has evolved and conformed to new technologies and new consumer patterns.

In the USA, conceptual planning and policy, however, is working hard to make sure that passenger transportation systems don’t evolve consistent with these new dynamics, but instead stay comfortably in the context and needs of the 1950s.

Wake Up Call #1 – California’s Obsolete High Speed Rail Program. We had the revelation last week that the planned California high-speed rail boondoggle continues to come off its financial wheels. Now, it seems that the estimated cost of the first planned 119 miles has jumped from a promised $6 billion to over $10 billion.

That involves only about 20% of the total mileage planned, and is only for a section that’s mostly in rural areas. The other 80% should be lots of financial fun.

Wake-Up Call #2. Local Small Community Air Service. The second wake-up call was the message conveyed in several media stories of small community airports planning to attend “speed date” events to “lure” more airlines to town.

Now, we’re referring to the many small airports that have no airline targets in particular. No specific connectivity contemplated. The goal is just to get in front of the supposed faceless mass of carriers that can put a scheduled flight at the gate – regardless of where it’s headed.

Two Different Modalities. The Same Ostrich-Level Planning. High speed rail on one hand and the “need” for air service at local airports – these two seemingly disparate areas are really part and parcel of a single major issue:

Much of America’s infrastructure planning is about passenger transportation, instead of the futurist imperative of developing new forms of efficient communication. In fact, much of the transportation planning has very little connection with consumer needs and trends in the 21st century. Transportation is just a part of the total communication system, and it is imperative that it be planned consistent with changes in other areas of communication – changes which alter the utility and value equation of the physical demands to move people from A to B.

In the case of high speed rail as well as that of air service at local small community airports, the flaw is the same: they both assume that consumer travel and communication trends are static. They both ignore new communication trends, as well as alternative consumer options.

Indeed, high-speed rail and much of the efforts to bring scheduled air service to some small community local airports have a lot in common: they are based on obsolete assumptions that gravitate around obsolete thinking and dead technologies that actually inhibit America from moving aggressively into the future.

High-speed rail – as planned in California – is as outdated as trying to re-establish passenger riverboats on the Mississippi. The cost issue – which almost universally originates with “studies” that are about as credible as a rigged carny game – represents a barrier that in most cases makes the whole concept a joke.

Then there is the nonsense about “high speed” – defined as over 200 miles per hour average.  If it’s a line between, say, Las Vegas and Los Angeles, with no stops through the uninhabited desert, then it might work – assuming that the “Los Angeles” end of the line isn’t a two hour drive from, well, Los Angeles.

But between Los Angeles and San Francisco, or Chicago and Minneapolis, only someone just back from Pluto could believe that the politicians at every town on the route won’t demand it stop there. That will kill the “high-speed” part. Hint: it takes a lot of distance to get a train up to 200 MPH and a lot more to get it back down to stop at East Cupcake.

Now, related to this is the issue of small community air service. Today, most of the discussions, planning, and “accepted thinking” in this regard focuses on “small airports” – and not on solutions for assuring rural access from the global economy.

That’s the giant fly in the current planning ointment – the sheer political nonsense that it’s all about keeping service at the local aerodrome, and not on looking to keep rural America connected to the global economy.

And that’s where the “speed date” event comes into play. It can be massively misconceived as a panacea for small airports, when there is no such future for re-establishing air service.

Let’s be clear: most of these speed-date get-togethers have clear and demonstrative benefits. To have the opportunity to tag up with a carrier that is already in town, or has a clear corporate strategy that makes sense for new service, is a very cost-effective way of building future communication.

But too often, small communities get hornswoggled into going to one of these events with virtually no understanding of the structure of the airline industry, or with the misguided notion that they will find an airline – any airline – to fly to town. It’s just to talk to the supposed faceless mass of airlines, and convince one or two to start service.

To fly to where? Many of these small communities come to the event not really sure, except that maybe a recent “market analysis” clearly showed that a lot of people want to go to Washington… or Dallas… or Chicago. No scientific data, and zero research on the existing consumer alternative options that will compete with the supposed point-to-point 9-seat departures at the local airport.

Sometimes this expensive misconception is just local lack of understanding of the structure and economics of air transportation. And, sometimes it’s the result of semi-ethical “studies” that fail to advise the client of the realities of air transportation. But, boy that $20K report has lots of cool data and charts and heat maps.

To state it bluntly, a large part of today’s air service development schemes is based on making sure no mention is ever made regarding the structural realities of the air transportation system – the most egregious being hiding the fact from small communities that there isn’t a giant pot of airlines at the end of the speed-date rainbow. To do otherwise would kill off the project.

That’s not any different from much of the body of “studies” of the potential for high-speed rail. Key realities, such as the low-balled cost estimates, the political pressures, not to mention the dismal economics, tend to get glossed over amid flashy pictures of racy locomotives and glorious claims about reducing “carbon footprints” or vanquishing “climate change.”

Also not considered is whether ridership estimates are within several galaxies of reality. Travel patterns change. Just take a look at air markets such as DAL/DFW- Austin, or ALB-BUF. You can take it to your bookie with confidence that the passenger volumes for “high speed” rail are directly out of fantasy land, just as are the conclusions in a lot of “market studies” done for small airports.

The Future Is In Building New Communication Channels. Local Air Service May Not Always Be A Part of It. The chase after “high speed rail” is a blood-brother to the bogus and obsolete – and impossible – concept of keeping air service at every local airport.

Regardless of the political and trendy stories and fantasies surrounding these issues, economic gravity cannot be reversed.

Let’s Move Transportation Planning Into The Future. What US planning needs to focus on are the levels of communication that regions of the nation have with the global economy. In some cases, there will be huge challenges – particularly on the relatively few cases where the population bases cannot support even regionalized air access.

We need to candidly recognize that tossing airplanes into small airports at communities where consumers have better alternatives, or building rail lines that are based on past travel and communication modalities, are heading the US into the past, not the future.

Join Us For More Straight Talk. Naturally, this isn’t consistent with “consensus” or “ambient” thinking. But it does open issues that a lot of folks in public policy planning aren’t too keen to discuss.

On August 19-21, at the 23rd Boyd Group International Aviation Forecast Summit, we’ll be openly exploring these and other global issues that will affect aviation planning.

As our regular attendees know, this event does not allow political correctness in the door. The industry leaders from across the industry and across the world will be there to tackle the issues that will shape how aviation will evolve as part of the global communication system.

For more information, and to get the special New Year’s registration rate, click here.

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More About The IAFS…

International Aviation Forecast Summit… 

The special New Year’s rate is still in place through January 31.

Next week. we’ll be announcing the airline CEOs that will be joining us to share their views of the future of global aviation.

This week, we are excited to announce Embraer will be a major sponsor of the 2018 IAFS.

In addition, in the sessions we’re in the process of monitoring airline and economic trends to be covered at the Airport:USA enplanement forecasts, as well as where we can expect to see major shifts in air service in the US.

More Regionalization – More Internal Airline Determination of Market Changes. The recent route announcements from American, United and Frontier signal a fundamental shift in how airlines will be pursuing changes in their route systems – changes that dictate major changes in how airports will need to address “air service development” in the future. It’s a new ball game, where jive-time “market studies” from the outside carry even less impact than in the past.

This is just one area that the IAFS will be covering. We’d again point out that the New Year’s rate is even less than registration at some speed date events – which deliver zero in terms of planning for the future.

More information & to register, click here.

We’ll see you in Denver, August 19-21!

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January 15, 2018 Update

News: International Aviation Forecast Summit.

The New Year’s Special Early Registration rates are in effect through January 31.

The #1 Event – And The #1 Investment In The Future. Take a look… to attend the IAFS, the #1 industry event, with input and interaction from CEOs and executives from airlines and aviation companies around the world, is actually less expensive than attending some second-tier “speed date” events.

At the IAFS, attendees network with dozens of airline staff, as well as the leaders who will be shaping the future.

In addition, the forecasts delivered at the IAFS – including airline trends, airport traffic, fleet applications and more – represent business intelligence that is of competitive value to all players in aviation.

So, before you commit to any aviation event for 2018, check out the IAFS, and join the industry leaders gathering in Denver, August 19-21.

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If US Carriers Want A Piece of The US-China Action…

They’d Best Understand It Isn’t Just Another International Market

One of the hottest social media threads in China last week was about Delta Air Lines.

And it wasn’t positive.

But it reflects a consistent issue regarding US companies and venues trying to do business with China. The problem: lack of attention to the sensitivities and needs of the Chinese market.

This latest event is not a minor issue – the Chinese government itself is ticked off, and when that happens, Chinese consumers make alternate decisions.

Farming Out China Programs To Unqualified Companies Can Be Dangerous. It seems that whoever developed Delta’s website was clueless about China.

Incredibly, they listed “countries” (“国家”)  that included showing Taiwan as an independent, stand-alone nation.  This is a lot more than just a minor typo.

The government of the PRC is not real happy about having a whole region of its nation being represented as a foreign country.

While not much of a story here in the US – yet – it has resulted in very serious warnings to Delta directly from the PRC government.

Poor China Focus = Business Vulnerabilities. See, the people in China (not to mention even the Nationalists they tossed off the Mainland in 1949) staunchly hold that Taiwan has always been and always will be a province of China, regardless of what the governmental structures may be.

Whatever vendor did this website is not a friend of Delta. And it sure is not in line for any business from anybody in the Middle Kingdom, either. But it does have Delta in some hot water.

The Dragon Wants Answers… The China Civil Aviation Bureau has issued to Delta what is a lot more than a pro-forma nastygram.

They’re demanding to immediately “arrange talks” directly with the Delta staff responsible, in order to “rectify and reform” this insult. Finally, they are demanding that Delta “make a public apology”, presumably to the entire Chinese people.

And since this is bubbling on Chinese social media, it’s not going to help build China-generated O&D for Delta. That this situation could arise is especially strange, since Delta has actually invested in China Eastern Airlines.

Developing a China Strategy Depends On China-Knowledge. On Delta’s part, there certainly was no intent to slight China, or get involved in internal matters such as the status of Taiwan.

But the problem is that the airline obviously relied on “expertise” regarding China that was anything but.

We’ve pointed out other areas where the US travel industry is way behind the curve in accommodating – or even bothering to try to understand – the China market:

Customs Facilities. Most of our FIS facilities are an embarrassment – where there is official Customs signage in Chinese, it’s in a version not used in China itself. That’s an insult to consumers and visitors from the PRC.
Lack of Understanding of The Chinese Market. Many US carriers’ Chinese translations, such as on domestic-flight emergency cards, often don’t bother to use the simplified system used in mainland China. Whatever sloppy vendors they use still assume that traditional Chinese is used there. But it is still used on Taiwan, which could be another embarrassing PR time bomb, if the PRC concludes that this is a de facto indication that the airline still thinks the Nationalists are the real China. In any case, it is an insult to visitors from the PRC.
Near-Zero Attention To Specific Needs of Chinese Visitors. Airport wayfinding for Chinese entering the US is abominable. Sure, every major airport will say they’re “China ready” – but the reality is that for Chinese trying to make a connection, they are on their own.
Amateur-Act Website “Translations” – Many US airports and communities continue to insult Chinese travelers with raw machine-done website “translations” that read like the Chinese version of the Clampetts wrote them. Web designers peddling these add-ons are not doing the client any favors.
Lack of Professional Outreach In China. As for outreach in China, just having a cookie-cutter Brand USA website doesn’t deliver much more than generic eye-candy. There are better options.
Getting Taken For A Pedicab Ride. There’s a lot of charlatan-stuff going on, too. One US gateway airport proudly showed us their WeChat app some vendor developed for them. Lovely, except it isn’t a China-registered business version. Almost useless.
China-Welcome™ Takes China Expertise Plus Travel Expertise. Boyd Group International and its partners at China Ni Hao, LLC represent the new professional standard in assisting airports, airlines, travel companies, and communities in crafting appropriate and tailored programs to attract and maintain more of this important and growing traffic. It’s not rocket science – it’s simply having expertise in China-outreach.

We’re developing China-Welcome™ programs and symposiums for clients across the US. If you’re interested in effective outreach to attract more visitors and investment from the Middle Kingdom, click here and take a look at the services we offer.

We produce results… not complaint letters from the Chinese government.

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January 8, 2018 Update

Before We Start… The IAFS

We’d note that New Years Early Registration for the 23rd International Aviation Forecast Summit is available through 31 January.

This year, we’re planning another record-setting IAFS, and as always, we’ll be exploring the future with the executives from across the industry who will be making the decisions. Click here for more information and to register!

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BTS Data – Built For Yesterday

O&D, T-100, Fares, Yields, Etc… Just A Starting Point – And Not Always An Accurate One, Either.

Hard, actionable business intelligence.

It’s not what’s available from Washington.

Here’s a bit of a bummer for all those folks who go to the BTS website (or a vendor using raw BTS numbers), pull down all sorts of reports and tables, and then log off thinking that they’ve just visited an electronic Delphi.

You may have numbers but you don’t have accurate business intelligence. Worse, it tells nothing about the future – because increasingly that’s driven by subjective corporate decisions.

Perfect For The Air Transportation System of 1975. The fact is that the DOT/FAA/BTS reporting systems are decades behind the total evolution of the airline industry over the past 35 years. As a result, much of the information in its raw form is flat inaccurate.

But that only means that professionals in aviation understand that such data are only starting points… amateurs take it as gospel.

A System Long Gone: Reporting “Major” And “Regional” Carrier Data. We’ll start with this. The FAA reporting is completely in the past. They do not understand the structure of the airline industry.

They still think that there is a “regional airline” industry, separate and distinct from “major airlines” – and they still separate the two as categories in much of their reporting.

FAA is oblivious that these once-independent carriers are now mostly leasing planes and crews to majors.

Splitting out the data is not only misleading but incompetent. It is a red flag to planning professionals to understand that the rest of the reporting is also affected by a woeful lack of knowledge of the current airline system.

From Certificated Carriers To Airline Brand Systems. This leads to the core of the problem with the outdated and obsolete data coming from the DOT/FAA/BTS: in the last three decades, the airline system has evolved from independent “certificated operators” to brand-systems comprised of several certificated operators.

Yet most of the reporting is still based on the inaccurate assumption that, for example, SkyWest is a consumer-brand, by virtue of the fact that it’s a “certificated carrier.” Actually, SkyWest leases aircraft and crews under its own certificate to American, United, Delta, and Alaska. Almost nothing is done under the SkyWest brand itself, anymore.

But that’s not how the data are collected and reported.

That means that much of the data reported for “American Airlines” does not include all of the brand system of AA – just the parts that are not outsourced to lift providers such as SkyWest, Envoy, Piedmont, Air Wisconsin, etc. The portion of American’s flights operated under its certificate is less than 65% of their total system.

Another big problem comes up when the same lift provider, such as SkyWest, operates the same market for more than one major brand. Just taking the raw BTS data, without further analysis, does not always break these traffic streams out separately.

Oversale & “On-Time” Reports – Partial & Misleading. Going into other areas it gets muddier and more useless.

“Oversale” data are particularly misleading, because, again, they’re still reported by certificated carrier. That means that the total oversale rate for United or American or Delta or Alaska isn’t compiled.

Worse, the capacity and booking rates for flights operated by these lift providers – as are schedules – set by the major brand to which it leases its aircraft, and the lift provider has little control over what gets oversold.

As for “on-time” – BTS does not yet include all on-time by brand. Worse, entities such as Air Wisconsin, which operates nothing over 50 seats, is not required to report schedule performance… that’s more than 60 airplanes with the AA brand.

Amateurs who don’t understand the data – and the shortfalls of the reporting – don’t recognize this. Yet, year after year, we’re regaled silly and inaccurate “quality reports” that list the data by certificated carrier, not disclosing that this is useless to the consumer.

More Data Fun – The O&D “Survey.”  As for traffic statistics, the “O&D” reports are still reported based on the capabilities of data collection systems being used long before Steve Jobs started tinkering in his garage.

That’s the reason that it’s based on just a 10% “sample” – in the 1960s and 1970s, there was no way the data could be complied on a 100% basis. Historically, it was done by using tickets with the number ending in “0”, and also group tickets. (This is really ancient stuff.)

The problem today – although electronically reported – is that this sample can be massively inaccurate – particularly as the market sizes get smaller.

Worse, there can be other challenges with the current reporting system, such as determining itinerary breaks, and projecting traffic flows. Indeed, there have been data that show connecting passengers flowing through Bangor – which is patently inaccurate, and actually, impossible.

No Fix In Sight. In 1997 – two decades ago – the GAO noted that this 10% sampling was inaccurate and misleading, and should be replaced by full 100% reporting.

Today, Boyd Group International’s Aviation DataMiner™ – unlike some sources – has the capacity to easily manage a full reporting system, and we fully endorse the recommendation, which, by the way, has pretty much been ignored.

What’s amazing is that most vendors and re-sellers of aviation data make no effort to either address these shortfalls or even advise their clients of them. That’s not surprising in that many of these re-sellers have no idea of the issue in the first place.

O&D Confused With Consumer Demand. Another bit of quicksand that “air service development” programs tend to get into is confusing reported O&D as being hard and fast core consumer demand.

It’s not. Maybe in the regulated 1950s, but not today.

O&D traffic today is the result of a range of factors that go beyond organic consumer demand. Levels of capacity, fares, competition with other carriers and airline corporate strategies affect traffic levels, and all are constantly in flux.

Therefore, comments like, “the O&D survey shows 85 PDEW to LAX” (passengers per day each way) are meaningless if the factors driving it are not fully analyzed.

If Allegiant is in the market, that means there’s impulse traffic, which is very different from core demand. If the ambient fares are high, or the access is constricted due to hub-choke, the real potential “demand” might be double current traffic levels. Just using reported O&D data does not address any of this.

Fare Data – Cost v Ticket Spend. Every month, left without adult supervision, media types get BTS fare data reports, and put out stories comparing “ticket prices” between various airports.

Nice. But stories like this are completely ignorant of the basis of the data.

First, in most cases, the BTS data doesn’t relate to comparing cost of travel, per se, but instead, average ticket spend. That’s a metric affected by a whole lot of variables – such as geographic location, local economy, population base, and much more.

For example, the average “ticket price” at Atlanta is $198.75. At LAX, it’s $219.70. (Including federal fees and taxes, first half of 2017.)

Now, the uninformed, and soon-to-misinform-the-public reporter, would grab this kernel of info and trumpet that Atlanta’s “ticket prices” are 10% below that of LAX.

But what the reporter doesn’t bother with are the factors behind this one factoid.

For one thing, the two data points are not comparable… Atlanta’s average domestic passenger trip is 895 miles. For LAX, it’s 1,548 miles – the average “ticket” is for an itinerary 72% longer than that at Atlanta, so the “ticket price” is higher due to material differences in the traffic base.

Another leeetle point that most in the media would miss, is that the average domestic fare per mile at LAX is 12.5 cents… at ATL it 19.9 cents. That’s 60% higher… but it has to do with the traffic mix, not whether airlines are charging more at one airport or another.

Sometimes the dominant industry in a region will drive traffic patterns, as therefore, the average ticket spend. Midland, Texas, for example, has business traffic patterns that are strongly affected by the oil business, resulting in disproportionate traffic to shorter-haul destinations, and therefore higher reported per-mile fares, but relatively low “ticket prices.”

The take away here is that comparing one airport’s average fares with those at other airports is strictly an amateur act. It’s unfortunate that it tends to be a staple in most traditional ASD reports.

Point: Unrefined Data Is Just That… It Needs Work. DOT/FAA/BTS data are only starting points, but without a professional understanding of the air transportation system AND the actual reporting systems, they are like the difference between crude oil and refined gasoline.

It’s Not Data That’s Important… It’s What It Represents Within Future Contexts. At Boyd Group International, our Aviation DataMiner™ system was developed simply because we needed a lot more than BTS numbers to assist our clients as well as accomplish forecasts and research projects.

So we developed a set of systems that deliver more than numbers. Aviation DataMiner™ delivers analytical firepower for industry professionals who are focused on the future.

Before You Spend On Another Source – Check Out The Best. What we’ve discussed here is the core difference between Aviation DataMiner™ and other sources. DataMiner goes beyond reports, and with the professional expertise of BGI, delivers actionable business intelligence.

We’d be delighted to show you the reason companies across the aviation spectrum have switched to Aviation DataMiner™.

Click here to register right now for a free trial.

You’ll find that the combination of our futurist expertise, and the superior real-world accuracy of DataMiner™ is your competitive planning edge.

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January 2, 2018 Update

Happy New Year!

Let’s Look at 2018 – Beyond The Consensus

The 2018 Boyd Group International Aviation Trend Outlook is now available.

In the document, we cover several areas where evolutionary and episodic change can be expected in the coming year and beyond.

Prepare For Some New Futurist Concepts. Boyd Group International has a track record of forecasting trends that are missed by other sources. The reason is simple: we do not accept at face value the “consensus” or what may be described as “ambient thinking.”

Those terms are just alternative descriptions of making sure that there are no risks taken and there’s no potential of challenging the entrenched thinking of the status-quo.

For more than three decades, Boyd Group International has built a track record of assisting clients from across aviation and across the globe in identifying new future opportunities. In doing so, we don’t go by the book. We write the future book, which is what we’ve done with this year’s Outlook.

Below are just a few basic subject synopses of the 2018 predictions and trend projections in this year’s BGI Aviation Trend Outlook. To view and download the complete document, just click here, and we’ll get it to you ASAP.

If you have any questions or input regarding this document, please let us know.

And, of course, if you need futurist aviation research, forecasting or consulting, we stand ready to assist. We would point out that many of the trends outlined herein are indicative of the scope and structure that will be delivered at the 23rd International Aviation Forecast Summit, August 19-23, 2018, hosted by Denver International Airport.

CEOs and senior executives from across the industry and across the globe will be here to openly discuss the future. No boring “panels.” Instead, direct discussion and exploration of the future from those who are shaping it.

To reserve your space and for more information: www.AviationForecastSummit.com Special New Year registration rates are now offered.

2018: Looking To A Strong, But Global 2018
Touching Briefly On Just Some of What’s Covered In the 2018 Aviation Trend Outlook…

Traffic Trend: Fundamental Growth… Plus More Impulse-Buy Capacity

Let’s put it on the line.

The hand-wringing from some in the financial world about airlines adding too much capacity in 2018 is strictly Chicken Little. Capacity discipline is firmly in control.

Look For @ 4% More Seats, But Less Than 3.5% More Flying. As of January 1, US carriers are scheduling a 3.9% increase in capacity for the first six months, compared to the same time period in 2017. Most of the reporting on this implies that carriers are simply adding flights on top of existing ones.

In some cases that is accurate, based on very high load factors, and particularly in cases where the carriers’ connecting hubs experience “hub-choke” – when there is demand for more feed through the hub, but the connecting banks to major destinations are functionally fully-booked.

But in other cases, much of the increase in capacity is based on network carriers (American, Delta, United and Southwest) adding new markets – particularly trans-border and international.

Also adding to the capacity picture is the expansion of the “parallel airline universe” – ULCCs expanding and offering fares that transcend ambient market “demand” and establish the travel product as an alternative application of discretionary dollars.

Wildcard: In any case, the recent reduction in the corporate tax rate, could result in carriers adding more capacity to meet newly-generated demand in the fourth quarter of 2018.

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2018 Trend: Hub-Choke Increasingly To Affect Route Planning

For airlines, experiencing very high load factors in key major markets to and from the carrier’s hubsite operations are generally positive.

However, this dynamic also represents some traffic spill – where consumers in, say, Abilene find it difficult to find space on the connecting flights from DFW. In some cases, carriers will use sophisticated analytical systems to build highest and best use scheduling – in effect weeding out feed markets that are the least revenue-productive for limited hub capacity. Expect more of this in the coming year.

Enter New Fleets:  With the phase out of what turboprops are left at American and United, and upgrade to increasingly cost-inefficient but larger 50-seat jets, more planning pressure will be but on network carriers to again review which small-airport routes  make the most sense in light of the major routes to which they feed being at or near functional capacity.

Now add in the new dynamic of AA, DL and UA creating new “basic fare” buckets, which are applied mainly to retain and attract more nonstop O&D traffic in key major (read:  nonstop hub) markets. This will further put a strain on the availability of capacity for smaller communities that depend on connect access at the hubsite.

The result is that, in many small-community feed markets, a load factor of 65% to the airline’s hubsite is functionally a “full” flight. There simply are no more seats available through the connecting hub.

This will continue to be an issue for smaller communities dependent on air access through a fully-booked hubsite operation. In many cases, these airports will be more than able to support the additional capacity to the connecting hub. Some, however, may be facing a potential pull-down in service.

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2018 Trend: Small Community Air Access: Fantasy Is No Longer An Option

Many small communities need to come to grips with the three major and largely irreversible trends that are shaping air access from the globe.

Hub-Choke. This we cover above, but what should not be ignored is that there is often no alternative airline to enter the a small community from an additional connecting hub. For example, when the distance to the UA/IAH hubsite represents more cost and more airplane time than the revenues that the market can generate, no amount of “market studies” will create more airlines or change economic realities. This is a reality that many smaller communities face.
Eclipsing Costs. The emerging “floor” for feed fleets to network systems is the 50-seat jet. It is being retired – slowly, now that fuel costs are where they are – but they do represent a higher revenue bar for communities to meet.
Consumer Preferences & Alternatives. Increasingly, within the emerging economics of airline operations, the type of scheduled air service that some smaller communities can support at the local airport is DOA. That’s because in many cases such service is consumer-inferior, less time-efficient, and actually less convenient than an hour’s drive (or even in some cases, even a 90-minute) drive to an alternative airport where the population (or an airline’s connecting hub) can support much wider flight access. This is another dynamic that no amount to civic hubris or more expensive and misleading “studies” will change. Regionalization of air access is an emerging reality in some parts of the US. It should be recognized and embraced, because the air transportation system isn’t returning to the 1980s.
That’s because in many cases such service  is consumer-inferior, less time-efficient, and actually less convenient than an hour’s drive (or even as we note in the Outlook in some cases, even a 90-minute drive) to an alternative airport where the population (or an airline’s connecting hub) can support much wider flight access.

In the Outlook we discuss how regionalization of air access is an emerging reality in some parts of the US. It should be recognized and embraced, because the air transportation system isn’t returning to the 1980s.

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2018 Trend: More EU Nonstops From The Heartland

A major dynamic discussed in the Outlook is the value that major non-hubsite US airports now represent to foreign carriers.

As was first outlined at the 2013 International Aviation Forecast Summit, key non-hubsite major US airports are prime candidates for EU carriers to add to their global systems.

For network carrier system such as British, Air France and Lufthansa, the traffic feed to their hubs in Europe from large US cities such as New Orleans, Indianapolis, Nashville, etc., can be very attractive.

The key factors for this service are generally, 1) a strong local population base, 2) very strong installed base of internationally-focused industry, and 3) – most important – strong highway network access from a wide population region.

This latter factor is important, as a nonstop London flight from, for example, New Orleans, is more convenient for folks to drive to from Gulfport, compared to the complexity of making a flight connection over IAH or ATL. This trend then tends to increase the profile of the larger airport as an alternative access point.

In addition, the massive expansion of impulse service to the Continent by WOW and Norwegian will open even more access. In these cases, however, the US point will be more of a destination, as opposed to a generator of feed traffic.

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Potential Trend: China Moving To Acquire Foreign Aircraft Manufacturers

In the Outlook, we step into uncharted territory by looking at the Chinese airliner industry, and making some bottom line projections on strategic planning that may be coming from the folks in Beijing in 2018.

What this means is that Boyd Group International research in the China aviation market indicates that we may see very significant and elsewhere-unforecasted moves by China to expand its global presence in the aircraft manufacturing sector.

In particular, there is a very real potential for Chinese entities to make a move to acquire either Bombardier or, more likely, Embraer. We believe the recent Boeing outreach to Embraer is at least partially a pre-emptive move.

Point: China is intent on becoming a major player in the airliner sector. Its current indigenous platforms are not going to be able to accomplish this. Therefore, an acquisition of Embraer or Bombardier (or, possibly another player we won’t mention right now) is not out of the question.

The potential shifts in relationships this could drive among suppliers, and the impact on the commercial direction of the US airframe and powerplant sectors would be very far-reaching in broadening the presence of Chinese business in America.

Getting Ready For China Can Make The Difference In Site-Selection. Moving on in that area, BGI predicts that more US airports and venues will need to become more welcoming to the Chinese leisure and business visitor.  To be sure, just about every US gateway airport claims it is ready for these travelers… but in most cases, Mars has better wayfinding and welcome than US facilities.

It goes beyond having a Mandarin speaker on-site, and it goes beyond veneer things like not offering ice water in restaurants. In regard to China communication, we also point out that the poor misled airports that have been sold an “international translation” website feature that includes Chinese, are simply making themselves look really amateur and silly to the Chinese consumer. The raw machine translations are insulting and tell the web visitor that the airport/community is out to lunch when it comes to professional outreach.

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Fuel & Labor Issues

It is understandable for financial analysts to be concerned regarding the potential effects of changes in these two key cost factors on airline bottom lines,

From a rational perspective, these are important to watch, and it is near-certain that in the next 18 months, labor costs will impact the bottom line at a number of carriers. However, given the expected robust demand, there are no thunderstorms on the horizon for 2018.

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These just scratch the surface of what to expect in 2018…There’s a lot more to explore.

To view and download the complete 2018 Aviation Trend Outlook, just click here, and we’ll get it to you ASAP.

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Fourth  Quarter 2017 Update Archives, Click Here