THE MONDAY FLASH – INSIGHTS & PERSPECTIVES
October 31, 2016
Congratulations To Ontario!
Tomorrow ONT enters a whole new phase as a gateway to Southern California, independent from Los Angeles World Airports.
At a time when the entire global air transportations system is dealing with new traffic flows, the future for Ontario is exciting… to say the least.
Our congratulations to Kelly Fredericks and his team!
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Coming – Re-thinking Cabin Safety Instruction
The American Airlines incident at ORD, where (apparently) a catastrophic engine failure caused an aborted take-off, is likely to change the approach to in-cabin safety announcements.
Take a look at the pictures – passengers were taking their carry-on luggage with them – stopping to take it out of the overhead, through the cabin, and down the emergency slide… some clowns in the cabin of the burning aircraft were actually taking phone-videos.
All while the right wing was engulfed in flames and half of the emergency exits were blocked.
It’s clear that passengers are not taking these instructions seriously – regardless of comedic approaches to getting the information across. The subject matter is dry and airlines have correctly attempted to get passenger attention with innovative approaches to demonstrating safety.
But in light of the Chicago incident – it’s clear that even on AA – which at least historically has pretty much kept the videos more straight forward – passengers just don’t get it.
Point: it’s likely that any safety videos in the future will be given a lot more pre-installed scrutiny in regard to effectiveness to the message across.
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Second Quarter 2016 Data:
What The Numbers Really Illuminate
The challenge with any sets of data is not reading the numbers, but ascertaining their value in determining current and future trends.
That’s the foundation of Aviation DataMiner™ – and what sets this business intelligence platform apart from other sources. The 2nd quarter 2016 DOT data is out, and, as usual, the media is abuzz making vapor-brained comparisons between numbers they don’t understand in the first place.
There are the perfunctory stories – put out by reporters who are clueless about what they’re writing about – that compare one airport’s fares against the “national average” – which is about as meaningful as comparing the performance of the Chicago Cubs to the Chicago Bears.
Using The Data, Not Just Parroting Them. At BGI, we help our clients see the future, not read tables of numbers from the DOT.
Here are the key metrics to monitor in this data. (The first requirement, however, is to have a professional knowledge of the data and the system that delivers it.)
- Airline Trends: It’s more than raw ASM/ASK production – it’s where it takes place, and the number of flights that are generating it. Plus, this is not a product-cohesive industry – if Spirit has a 20% increase in departure production, and United has -5% decrease, the average is not a valid metric.
- Fleet Trends: In the 2nd quarter, the continued move toward larger units of capacity was demonstrated. For those playing the ASD home game, without any understanding the airline strategies, they miss the fundamental issues of fleet changes by airline brand. For just one example, we’ve seen both United and American start to re-plan for a world without 37-seat turboprops… this needs to be a message in regard to future air access planning.
- Airline Corporate Strategies: Understanding what airlines are announcing from the front office can help determine the value of reported data. For example, the attendees at the 21st International Aviation Forecast Summit this year got insights on the very difference fleet planning strategies at Frontier v Spirit.
- Capacity Trends: To start with, the US air transportation system is not growing… like, not at all. The number of departures in the 1Q of 2016 was up just 1% – which is statistical noise.
The message is which airlines added departures – regardless of the fact that the industry as a whole added just 1%. Seats were up about 3.5%, but that’s not to accommodate more demand, but simply due to the increasing size of the average aircraft in major brand fleets. And, again, it’s who is shifting capacity that tells the story.
- Revenue Trends: The take-away here for airport planners is that in a shrinking airline industry, with larger average aircraft, the name of the game will be revenue-quality, and not just traffic volume. Furthermore, we’ve seen both United and American start to re-plan for a world without 37-seat turboprops… this needs to be a message in regard to future air access.
These are important factors – ones not even vaguely addressed in stock ASD “studies” and “consumer surveys” that are semi-ethically foisted on airports containing veneer gotcha questions (“will you use the local airport if we have flights to Newark?”) – without any further discussion of what that service will be.)
For aviation planning professionals, we’d recommend a review of Aviation DataMiner™ as your source of industry business intelligence. The range of reports and the flexibility of DataMiner™ delivers strategic planning – not just tables. Click here for more information & a free trial subscription.
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October 24, 2016
Touch ‘N Go – Air Access Update
Congratulations to New Orleans on recruiting British Airways flights to London, starting next March. BGI is proud to have worked with MSY in these efforts.
This international service joins Condor, which will be operating to Germany from New Orleans this summer, another project in which Boyd Group International was involved. Our advanced forecast and strategic planning expertise, such as the concept of illuminating the “road-hubbing” dynamic that nonstop international service generates, was a core reason for these successes.
Our client Ithaca will be seeing larger American Airlines aircraft this spring, as the carrier concentrates Southern Tier service into that airport. We are honored to have worked with ITH in its strategic air service planning.
These events join our successful efforts that have led to air service access improvements in the past few months, including implementation of highly-successful AA service between DFW and Bozeman, and a SCASD grant that’s made access to AA/Phoenix possible from Santa Fe.
And as we noted last week, working with entities in Colorado Springs helped attract Frontier back into town, now with flights to Orlando, Phoenix and Las Vegas.
This is what sets Boyd Group International apart from other consultants. We are experts on airline strategies, and we have the respect of airline industry leaders. Plus, we have better data – including the only airport traffic and trend forecasts accomplished in the private sector.
If your community is focused on results, not endless “studies,” give BGI a call to discuss your air access issues. As our clients will tell you, we will give you the facts as-is and where is.
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The Administration’s New “Competition” Directives
Just a little bait-and-switch…. But at least this time the switch had some value.
Last week, we all waited to hear about the carefully media-packaged directives that would be coming out from the depths of the Obama Administration to enhance airline competition for consumers.
What finally oozed out, in a shower of high-sounding, empty-suit press releases, was basically a requirement for airlines to refund bag fees when they screw up, for airlines to report on-time data for all of their branded flights, and some gobbledy-gook about making total cost of air travel transparent.
Nothing about competition, but at least it was generally positive.
As for the bag fee refunds, it should be embarrassing to the airline industry that the DOT filled this regulatory gap. To take money in exchange for handling a passenger’s Samsonite would imply a commitment and a de facto contract to do what is expected when a bag is checked – to get it to the customer at the other end of the flight. If that fails, the airline should refund the dough.
Whether or not some airlines may have already been doing this is not the issue. The DOT saw a chance to regulate, and they jumped at it.
Data Not Understood. The biggie, however, that has the lightweight media all in a dither, is the requirement for airlines to report “on-time” performance for all of their flights, not just the ones operated under the brand-name operator’s certificate. Because of the DOT’s 19th century reporting system, they still think “certificated carrier” is the same as “airline.” (So does most of the media as well as the academics that churn out “quality” reports every year.)
The media saw the term “regional airlines” in the directive and proceeded to charge off into the weeds, with lush stories about how this will reveal the sorry state of schedule performance in “regional” markets. That’s because, as we all know, that these “regional airlines” just fly to “regional” markets.
Silly Headlines…We’ve been regaled with misleading headlines, like “Airline On-Time About To Get Worse” – clearly demonstrating that knowledge of the subject matter is not a job requirement. Since these reporters are clueless of how and where these “regional airline” assets are used, to make such as statement again cautions us to be suspect of much of the veneer stuff that gets onto the wire. The fact is that they have no idea regarding what the actual numbers might be, but they see “regional” and assume that it’s all small airports, and all substandard performance.
Point: the on-time performance of the industry won’t change. It’s just that more of it will be reported. But to read these dimbulb headlines, one would think that we’re about to see more and more delayed flights because of new disclosure requirement.
It’s another reason that much of what’s regurgitated by the media is about as reliable as the information from a third-rate used car lot. What these writers – many from big-name news sources – don’t know is that these “regional airlines” are neither regional nor airlines, and they provide lift that is used in markets such as Denver-Phoenix, Chicago-Atlanta, and Denver-DFW. Real “regional” cities.
But nonetheless, knowledge of the subject matter isn’t much of a requirement, anymore.
By the way, subscribers to Aviation DataMiner™ have always had more accurate on-time data, because we re-map the information to reflect where “regionals” are flying for majors. Unfortunately, much of the “regional airline” data doesn’t exist, because operators of 50-seat and smaller airliners up until now have not reported any such data. The academics that slush out airline reports and the see-it-and-regurgitate-it media don’t bother with this bit of information.
As for the gobbledy-gook from the DOT about full transparency of the cost of travel, the fat is in the fire for the airline industry. Regardless of any philosophical concepts about “re-regulation” it is clear that the DOT is going to do something in this area unless the industry jumps to it first. Consumers don’t always have a clear idea of the cost of a flight, and even if it’s just 1% of customers, it’s an opportunity for the feds to get involved.
And that’s usually not good for anybody.