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After analyzing more than 10 million flight records, the Senate Joint Economic Committee released a report asserting that flight delays last year cost passengers, airlines and the U.S. economy more than $40 billion. The losses stemmed from increased airline operating costs--delayed flights consumed about 740 million additional gallons of jet fuel, or $1.6 billion--lost passenger productivity and time, and losses to other industries, according to the report.
Another report, issued today by the Travel Association of America, found that frustration among travelers has led them to avoid 41 million air trips--including 12 million business trips--during the past 12 months, costing the U.S. economy more than $26 billion.
"Airline travelers will likely face another summer of headache-causing delays," said Rep. Carolyn Maloney (D-NY), vice chair of the Joint Economic Committee. "Given the cost to consumers, the economy and the environment, it's clear that air traffic reforms are overdue after eight long years of inaction."
According to JetBlue Airways senior vice president for government affairs and associate general counsel Robert Land, it has been a back-and-forth battle between the airlines and the Federal Aviation Administration to compromise on how to alleviate congestion.
"No airline wants to cancel a flight," said Land during recent New York City Business Travel Association meeting. "That's revenue you are never going to get back again. You don't get to sell the banana at half price tomorrow because it's a little more ripe; it's gone forever."
"We have found so much difficulty in dealing with the FAA," said Ridgefield, Conn. first selectman Rudy Marconi. "FAA has received more petitions on the implementation of an air space redesign than ever before. FAA is part of our government, and they should respond to our people and their citizens when there is just concern. We are not saying, 'don't do this,' but 'before you do it, do your homework and let's be sure it's the right action.' "
At New York LaGuardia Airport, the U.S. Department of Transportation's most recent proposal to relieve congestion is to limit each airline to 20 take-off and landing slots per day for the next 10 years, with additional slots put up for auction and/or retired.
However, enforcing slot limitations or flight caps--limits on the total number of flights per day--is not the answer, according to Land. "There has been some unreasonable scheduling, and that, plus legitimate scheduling from all of the carriers, has caused a problem. We need to create more capacity," said Land.
Land noted that the airline pleaded with FAA to ease the restrictions because slot limitations and flight caps did not match the growing demand of travel. In 2007, more than 40 million of 689 million nationwide travelers passed through the airport terminals of New York City; by 2025, an estimated 1.1 billion passengers will be flying nationwide, the Senate committee reported.
"Eighty-four percent of our business is based here" at New York JFK, Land added. "We are going to see a slow death to our airline if these [flight caps] continue." FAA and JetBlue have held numerous meetings since April 2007 to try to resolve their issues, but little progress has been made, he said.
The Business Travel Coalition called slot auctions enforced by DOT a "foolhardy adventure," that would increase airfares for business travelers and raise airline costs without reducing delays or congestion.
"If DOT is so enamored of slot auctions, then it should conduct a multi-year experiment to generate quantitative data at a single airport somewhere outside the busiest airspace on the globe," according to a BTC. New York JFK, Newark Liberty International and New York LaGuardia accounted for more than 27 million hours in passenger delays in 2007, the committee reported.
Heavy delays and congestion are forcing U.S. airlines to circle above airports and wait for landing space, resulting in millions of dollars in additional fuel costs. JetBlue's new partner Lufthansa reported daily jet fuel waste equivalent to 11 one-way trips from Frankfurt to JFK, mostly due to circling over Germany waiting to land, according to Land.
"We're really at the mercy of so many things outside of our control. It's not in Lufthansa's interest to have these delays, and it's certainly not in JetBlue's interest," said Land.
With airlines and government officials butting heads over how to resolve these cancellations and delays, travel managers and business travelers are forced to navigate their way around a broken system, NYCBTA members said.
"Updating the air traffic control system is a long way off, and there has to be collaboration of all the stakeholders because clearly we have a serious problem that needs to be fixed," said Susan Finkbeiner, Goldman Sachs vice president, and manager of travel services.
A traveler spends about an hour in traffic to get to the airport and then is faced with delays or cancellations, according to travel managers. In some cases, business meetings are canceled as a result of delayed flights.
Conducted this month, a Travel Industry Association survey of 1,003 travelers found frustration throughout the traveling public led to 41 million avoided trips during the past 12 months. Among the 212 surveyed travelers who had taken at least five trips in the past 12 months, 41 percent said they avoided at least one air trip, with the mean number of trips avoided in the past 12 months at 2.6.
The $26.5 billion overall economic impact that resulted from the total number of avoided trips includes $9.4 billion in airlines losses, $5.6 billion in hotel losses, $3.1 billion in restaurants losses and $4.2 billion in lost federal, state and local tax revenue.
"The air travel crisis has hit a tipping point--more than 100,000 travelers each day are voting with their wallets by choosing to avoid trips," said TIA president Roger Dow. "We really have to get on the radar screen the implications of all this, not just on hotels and airlines, but what it does to the person who doesn't go to the meeting or convention, what it does to the person who doesn't go and get the deal done for their small company, and the ongoing impact way beyond just our industry that this has."
"One of the problems with that is that no matter how well informed a decision you are allowed to make in travel, if your flights are canceled, there is very little chance there is even going to be another flight available for quite some time," said Finkbeiner.
Some travelers have become so accustomed to delays that they expect them, especially on days with poor weather conditions. But travel managers, airlines and airports alike are all demanding state-of-the-art technology that could allow for better communication about flight status.
"The system itself is not really helpful as far as them not being able to reach us. Every single person in this room represents a company that is totally dependant on air travel. It's ludicrous that we are depending on a system that dates back to the 1940s," said Finkbeiner, referring to air traffic control system.
"That technology is 70 years old; Neil Armstrong is close to his 40th anniversary of walking on the moon," JetBlue's Land agreed. "We are told regularly that in Kabul, Afghanistan, there is a far more sophisticated air traffic control system than here in New York!"
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