Tuesday, February 9, 2010

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Report: Jet Fuel Conference
Mix of aircraft could change as legacies rebound; an emphasis on supply, safety


Regional Jet Craze
The air carrier fleet is beginning to see a changeover in aircraft, with the decline of the regional jet craze.
Tables
The FAA released its fuel projections for aviation at its annual Forecast Conference in March. Overall, FAA sees U.S. airline fuel consumption growing at an annual rate of 3.7 percent. General aviation will see an 8.6 percent annual growth rate in jet-A consumption, and a 1.9 percent avgas annual increase.

LAS VEGAS — The mix of aircraft could change simply because the role of legacy carriers could increase, says industry prognosticator Michael Boyd of Denver-based The Boyd Group. The hub and spoke is not dead, says Boyd, and may have an opportunity to grow, which could have a significant impact on line operations at smaller airports.

Meanwhile, the role of airports in delivering line services remains a lively debate, with John Armbrust, president of the Armbrust Aviation Group, host of the 8th Annual International Airport Operations/Jet Fuel conference, forecasting an increasing role for airports. Jet fuel supply remains volatile because of market forces and global politics. Meanwhile, Boston Logan outlines a safety initiative that's having positive results.

According to airline industry analyst Boyd, the low-hanging fruit is gone for the low-cost carriers. Real airline growth in the U.S., says Boyd, will come from “secondary” cities, which fit well with the hub and spoke system of the legacy carriers.

He points to many smaller cities — cities such as Montgomery, AL and Greenville-Spartanburg, SC — which are creating a Sino-Centric business base, connecting their economies to China.

The air carrier fleet is beginning to see a changeover in aircraft, with the decline of the regional jet craze. According to Boyd, “there’s no such thing” as a regional airline anymore.

Over the next three to five years, he projects, the airline industry will see an influx of Embraer mid-size airliners and the like, along with “the dawn of the plastic aircraft” — the Boeing 787.

Of the legacy carriers, Boyd says Northwest, Continental, and American are in the best long-term financial and industry positions.

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