And What Would Happen If Commercial Aviation Was Simply Impossible To Do Profitably?
from the the-impact-could-be-far-reaching dept
I tend to be something of an innovation optimist, believing that most resource constraint problems are eventually solved through ingenuity and innovation, but there can be some hiccups in the process along the way. Here's an article looking at the airline industry, and trying to spin some scenarios of what would happen if it simply turns out that the commercial airline business is completely unsupportable. Obviously, with fuel costs so high, it's become more and more difficult to keep airlines running (and it was never all that easy back when fuel costs were cheap). However, people seem to take for granted what cheap and readily available air travel allows. It touches on so many different businesses that it's hard to fathom how deep the eventual impact would be if air travel needs to be significantly curtailed in the future.It's not just the obvious industries: airlines, tourism, etc. It would impact things like e-commerce companies that rely on cheap shipping. It would impact conferences. It could impact all sorts of industries when sales people can't as easily go visit customers. The more you think about it, the more industries you can find hurt by a decline in the availability of cheap air travel. Of course, there are other industries that would benefit as well, such as telecom companies and video conferencing firms.
Still, the optimist in me just sees the scenario as an opportunity for innovation. In fact, all of those other industries that would be hurt by a reduction in air travel would have it in their own best interests to help fund research and development into alternatives and improvements, so the funding for such innovation could come from many, many different places. But if it takes a while to figure out the problem -- and the airlines keep screwing things up themselves, there may be a rather unpleasant interim while everything shakes out.
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Transportation vs Communication
When I were a lad, I remember reading Arthur C Clarke's exercise in futurology, Profiles of the Future. As I recall, one of the questions addressed was the tension between improvements in transportation technology versus those in communication technology. If the latter was nearly as good as being there, that lessened the need for you to physically travel; equally, if the former was fast and efficient, that reduced the savings in effort from sending a message instead of travelling.
I think what's happening is, the basic fact that transportation is always going to be more energy-intensive than communication is now tilting the balance towards the latter.
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Well, there's always advertising to "save" the day!
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Re: Well, there's always advertising to "save" the day!
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Re: Re: Well, there's always advertising to
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Re: Well, there's always advertising to "save" the day!
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Re: Re: Well, there's always advertising to "save" the day!
Don't throw out the concept because you've been exposed to lots of bad advertising. The good advertising that goes on, you don't notice. So it would be for the good campaigns that went to lower your plane ticket. (The bad ones would annoy you but would eventually peter out due to lack of success).
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Re: Re: Re: Well, there's always advertising to "save" the day!
As oil goes up, things that were once included (I dunno, things like "Baggage") are then considered luxuries and get fees attached.
If airline execs are interested in lowering the cost of oil, they should... And I'm serious about this... stop all revenue flights for a week. DC will take notice and do something.
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Re: Re: Re: Re: Well, there's always advertising to "save" the day!
If you are willing to pay for an ad, then how is that bad?
As for your belief that the price of oil can (or should) be controlled by DC...I can only say that there are much bigger things at work in this system then what a couple of bills could address.
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Re: Re: Re: Re: Re: Well, there's always advertising to "save" the day!
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good god. that's a depressing idea...
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Re: Re: Re: Re: Re: Re: Re: Well, there's always advertising to "save" the day!
Godaddy adverts are produced inhouse. They are taylored to the demographic of a superbowl watcher.
good god. that's a depressing idea...
I KNOW! Now, imagine ads that are offensive AND engaging to a variety of demographics. It looks like Disney commercials. Now imagine watching the 1-hour inflight "Disney-Ad Network" video. But remember, it repeats every 2 weeks. Sounds like fun, doesn't it?
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Re: Re: Re: Re: Re: Re: Re: Re: Well, there's always advertising to "save" the day!
I like offensive and engaging ads. Usually it's my wife that finds them offensive though. Do you mean "Not Offensive"?
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Re: Re: Re: Re: Re: Re: Re: Re: Well, there's always advertising to "save" the day!
I am...and them I'm imagining the next flight after that, the one where I'm on another airline and the one that showed the horrendous ad is out of business for lack of customers.
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TIAA?
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I think
Husbands will find different ways to get away from home, and businesses will find other ways to bloat their expense accounts and other perks to offer their employees.
There is nothing wrong with air travel becoming more expensive - people will use it less and use the alternatives.
Businesses that actually need air travel will also be able to afford it. Perhaps private charters will become more popular or maybe we'll see "plane-pooling" , as in car-pools. That should be fun...
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Re: I think
Um, isn't that what air travel is? When is the last time you were the only one on a plane...
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Marketing Myopia
Here, I suspect that you're making the same mistake, in confusing AIR travel with travel itself. While personally I have no doubt aviation will solve its problems, I also strongly suspect that other avenues will expand to take up the slack should they falter. Liners, trains, airships, even ultra-high efficiency cars and trucks and buses are all poised to jump in and expand their markets and business.
We may even change our mindset once again, back to the time when taking a trip encompassed the journey just as much as it did the destination.
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Re: Marketing Myopia
My best vacation memories are things we did on the way there or on the way back. It was the things we came across during the drive and spontaneously said "Let's do that" that were usually the gold nuggets of the vacation. We never flew, and we never used hotels (we were always pulling a camper), so we never had the kind of tense timeline and rigid schedule imposed on most vacations today. I have still never flown for a vacation. Vacation should be an opportunity to relax, unwind, and do whatever you want at the moment, not another itinerary that must be followed. That's my thought, anyway.
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Re: Marketing Myopia
the point he was making was a comment on a worst-case scenario; IF the running of airplanes becomes economically infeasable and IF there is no sufficiently expedient alternative mode of transportation THEN the following industries could see a severe jolt from the sudden absence of airtravel.
On the other hand; are larger planes more fuel efficient per weight than smaller planes to keep in the air? If so, what would essentially happen is smaller businesses with smaller planes would get crowded out of the market (a phenomenon we are already seeing) and, if demand doesn't drop equivalently, the remaining businesses will see larger and larger planes (already happening) carrying more and more passengers (again, already happening - average flight is 90 something percent booked) until you have an oligopoly of a few large companies ferrying cargo and carrying passengers and a minimal amount of commercial planes in the air.
Perhaps air transport just becomes a natural monopoly/oligopoly under the appropriate circumstances; when the fixed costs (planes) becomes oppressively high in order to keep the marginal costs (fuel) efficient enough to make a profit. Are there any other examples of this? the train industry, perhaps?
www.wheeltug.com - go there for research; it's about a highly specialized electric motor with enough torque to taxi a 777 to the runway without the use of jet engines. It will save millions (possibly billions) of gallons of fuel each year that are spent by idling airplanes.
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Re: Re: Marketing Myopia
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All doom and gloom?
And in regards to European taxes on airlines, it’s a pipe-dream of environmental pressure groups at best. Within the steady decline of European economies the Aviation sector is the only manufacturing sector that’s showing much resilience. It simply isn’t conceivable that the EU would turn round and shoot themselves in the foot like that.
The green issues around aviation have always been exaggerated simply because aviation constitutes an easy target, but 3% is 3% no matter which way you look at it.
At the end of the day our economies need global travel as much as they do national travel. Arguing that you can remove (or forcibly reduce) air-travel through political sanctions is being very short sighted.
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Hmmm
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Does any other country in the world . . .
"There's a classic business article called Marketing Myopia, which details how railroad executives saw themselves as being in the railroad business rather than in the transportation business, and as such failed to take advantage when trucking and air freight became mainstream."
Wait, railroads are still very successful at frieght, its passenger travel that is a money loser for them (and this is largely by design).
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The price of peace
We haven't had real progress in that field since the 1960s. The progress we made in transportation efficiency/speed/price can be measure in xxx%, while communication is measured in xxxxxxx% .
It's a matter of priorities.
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Re: The price of peace
It's really apples and oranges. Both fields are driven to higher levels of speed and efficiency by our overall levels of technology and computing. You can't compare travel to electronic communication - it's not a matter of priorities, it's a matter of physics; YOU try accelerating a massed body to a significant fraction of the speed of light to compare it to photons zipping down a fiber optic cable.
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Re: Re: The price of peace
To a scientist in the 50s, the ability to handle 10GBps would sound far more fictional than a 2-mach water-powered car.
10GPps is simply inconciveable - ~1250 Billion bytes of data per second. A plane that does space flights is far more reasonbale.
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Re: Re: Re: The price of peace
A little bitty fiber-optic cable can handle 1Gb/s, and that's something like 1mm in diameter, right (not counting the insulation, shielding, sheath, whatever the cover is called)? To get to 1250 GB/s (I don't know what a GPps is) would require something like 10,000 of those, which would measure 10 meters across. Now that's a stanking big cable, but it's just barely conceivable that we could achieve dramatic increases in transmission efficiency, through various and unrelated techniques. Say a hundred fold. That would leave you with a 10 cm cable. Still big, but for someone who actually needed a 10 terabit/s connection, it would be possible.
I don't think that word (inconceivable) means what you think it means! So back to your original claim, that the difference in progress is a matter of priorities. Do you mean that there has been more market demand for improved telecommunications than improved air travel? Could be - I'm not sure how you would measure that. What would be even harder to prove is that that is the only limiting factor - that if there were only more demand, we would already have commonplace hypersonic commercial transport. In my not totally well-informed opinion, the engineering challenges on the transportation side are harder. Laying tons of fiber is expensive, but there's nothing about it that we don't already know how to do.
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Re: Re: The price of peace
The comparison is not physical travel to telecomuting but two forms of people to people communication.
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Re: Re: Re: The price of peace
not all forms of flight are people to people communication.
and again, if we look at it as such, you are saying that we SHOULD be presently capable of moving PEOPLE as fast as we can move DATA. again, purely ridiculous.
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Same Problem with Cars and trucks
Not to get off subject but I always had an issue with the "driving is a privilege not a right" statement. I'm sorry but in today's society if you took everyone's license away the the country would collapse.
Driving is a necessity for things to continue as they are, just like flying is. Any interruption in that will lead to massive hardship, which generally leads to some kind of war.
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Re: Same Problem with Cars and trucks
People will realize it isn't worth it to live 20 miles from work anymore. They will either move or find a job closer to home (or one that allows telecommuting). Locally grown produce becomes more cost effective as transport costs climb. So there will be jobs opening up locally that are currently handled by long distance services.
Shifts will happen, but collapse isn't likely.
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What's the problem anyway?
If it is empty seats, has anyone thought about down sizing (like average Americans do)? How about flying Aircraft with a smaller number of seats, and greater scheduling flexibility offered to the customer, so the flights stay full? It seems to me their now doing the "train" style people hauling. One huge people container, traveling down the same set of tracks, at the same time every day. What about the "taxi" approach. A smaller number of available seats and let the customer choose where they want to go and when - then charge accordingly.
Is it really that tough to figure out?
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Re: What's the problem anyway?
After 9/11, when nobody was traveling, the airlines did just what you suggested; they significantly reduced the size and numbers of aircraft in service.
Airlines aren't profitable because they have instilled a 'just wait for the sale' type mentality. Then the to encourage more repeat business they created frequent flier miles; now people fly for free. oops. And even better I can earn miles by things *other* than flying. So buy enough groceries/gas/etc and you fly for free. Double oops.
The airlines are going to be in the same boat as the Postal systems. Some things have to be sent/travel, but many can go by a cheaper alternative of the internet/video conferences. As a result the industry isn't going to grow, but shrink in the long term.
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The Business of Transportation
Michael Long (#5) notes the marketing myopia of the railroad executives. The airline industry is making the same mistake. A solution to the airline mess would be to eliminate short haul airline trips and limit airline travel to long haul routes. Unfortunately, this goes against the grain of the free market.
In the end the free market will correct, but it will be like the current housing/financial bubble of today that is currently imploding. Do we really want to wait for a collapse of the airline industry and the consequential collateral economic damage?
While we may not like the evil word "regulation" I suggest that we start (gasp) prohibiting short haul air traffic and promote (gasp again) incentives to use rail for short haul routes. Unfortunately, solving a problem in advance is considered un-American.
PS: Airline travel would be discourage in situations where the total time, from the time you arrive at the airport to the time you depart your destination airport, equals of exceeds the approximate times it would take to arrive at your destination under alternative forms (car and/or rail).
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Re: The Business of Transportation
Right now it costs me roughtly the same per-mile to fly from Birmingham to Dublin as it does to get the train from Birmingham to London, and at much greater speed.
Rail travel simply isn't a good alternative to short-haul air travel right now.
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Re: The Business of Transportation
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Re: The Business of Transportation
That doesn't even address the needed gov't funding for a massively increased rail infrastructure to support.
And, for rail to compete speeds have to be *much* higher, like 300mph. This means that any sabotage of a rail line creates almost certain catastrophes. Protecting thousands of miles of rail-lines isn't a cheap thing either. Once you leave the ground in a plane it's pretty much safe until you have to land again.
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Re:
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giving away goods for free is only in the realm where reproductive costs are essentially 0.
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Huh? Please explain the marginal cost of reproducing an MP3.
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I have a great Idea!
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Re: I have a great Idea!
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Re: I have a great Idea!
Thanks, but no thanks, I don't want Billy G. or his minions in charge of anything that is or can become life or death. Last time I was hospitalized, one of the monitor machines in the operating room prep area blue-screened. Not very comforting, seeing that right before I was wheeled into the OR . . . and you want that in an airplane?
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The industry is heavily subsidized, ridden with debt, and restricted by unions. The industry is heavily susceptible to competition and market strength. But when the economy adjusts downward, they can't help but take huge losses.
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We know how to do that already
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Air Shipping
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What if Mike Masnik was to take English lessons?
And What Would Happen If Commercial Aviation *WERE* Simply Impossible To Do Profitably?
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Example of Innovation?
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Re: Example of Innovation?
And What Would Happen If Commercial Aviation *WERE* Simply Impossible To Do Profitably?"
Sophist: a person who, while professing to teach skill in reasoning, concerned himself with ingenuity and specious effectiveness rather than soundness of argument.
You grammar nazi. Why don't you fold your "subjunctive" until it's all sharp edges and shove it up the wrong end of your one-way digestive system.
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how do you kill an industry?
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Re: how do you kill an industry?
be a bit more greatful for government control in a public transportation medium (roads, rails, and air)
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Re: Re: how do you kill an industry?
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Re: Re: Re: how do you kill an industry?
a fractional amount.
still, mid-airs still occured, and made news when they did. when was the last unintentional collision you've heard of? the last 3?
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Give up!!
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Re: Give up!!
in an open market, the production of goods will reach an equillibrium where suppliers will produce at their marginal costs. If a minority of people have an more efficient method of production, their marginal costs will be lower, enabling to make a profit. people with inefficient production will be forced to leave the market. that's just how it works naturally.
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Yawn....
life. Do you even have a passport? Do you travel?
Have you noticed that fuel prices in most of the
rest of the industrialized world have been many times
what the cost of fuel has been in the US, until very
recently?
I imagine that jet fuel is commensurately even more expensive.
So, how is it possible for the national airlines of those
other countries, with HISTORICALLY high fuel costs to
be profitable, have newer planes and actually deliver on
exemplary service, while American airline companies
are squealing like pigs stuck in a meat slicer?
I don't know the answer to my own question, but I'm
convinced that local troubles have more to do with
ineffiency than anything else.
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Re: Yawn....
rest of the industrialized world have been many times
what the cost of fuel has been in the US, until very
recently?"
Do you realize we're not as taxed as other nations which is why these countries pay more for fuel?
Do you realize ALL airline industries are facing this issue and not just in the United States?
Maybe if you took the time to get off your anti-American sentiments you'd realize the growing fuel prices affects every nation, not just ours.
Take a look around you and then compare to the United States.
There's a reason why so many want to come to this country, as opposed to those other industrialized countries.
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Re: Re: Yawn....
> is why these countries pay more for fuel?
And your point is? They pay more, yet they deliver
a better product and actually have service.
It costs more, yet they deliver more. Why?
> Maybe if you took the time to get off
> your anti-American
Baseless ad-hominem attacks are not very useful.
Why is it that some people resort to shouting "Hitler"
or "Anti-American" at the first sign of criticism?
> sentiments you'd realize the growing fuel prices
> affects every nation, not just ours.
No, the growing prices have not affected other countries
nearly as much. Before the price of fuel started to
skyrocket, it was about $1.50 a gallon here in California.
In Japan, it was about $6.00 - $7.50 per gallon.
Our prices here in California have gone up four fold, but
the price in Japan has not gone up four fold. Why?
> There's a reason why so many want to come to
> this country, as opposed to those other
> industrialized countries.
Really? What does this actually statement have to do
with the airline industry at all?
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Re: Re: Re: Yawn....
the 'cost' of gas is different than the 'taxes' on gas.
Oil is a global commodity, everybody pays the same amount for it (unless your a 'producer'). So Japans gas 'cost' has gone up the same as everybody else.
I'll bet good money that $6-7/gallon gas price paid for your spiffy nice speedy trains and public transport systems.
I'm not saying the US is a better system by any means. The choice here was to not use gas taxes to pay for massive public transport networks. Good or bad, that I won't try to determine, but making the US as public transport friendly as other more tightly packed geographies isn't a simple option either.
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Aviation Fuel..
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Re: Yawn....
other countries, with HISTORICALLY high fuel costs to
be profitable"
They are subsidiszed by thier governments, airlines in the United States are not (directly at least).
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Re: Yawn....
distance.
Travel within the Eurasia/Mediterranean is cheap because they have much shorter distances to travel and can use much smaller planes than American cross-continental flights. Yes, jet fuel is more expensive, but prop jets don't use as much fuel as jumbos.
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Re: Re: Yawn....
You actually think we all fly around in propeller powered aeroplanes?
Do you know, for example, how far Portugal is from Turkey? Although you probably think people in Turkey are too busy becoming terrorists to actually fly anywhere(sic).
I don't know...
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Re: Re: Re: Yawn....
I am merely pointing out that there is a geographical advantage in that region which is not shared in cross-continental American flight.
God forbid I should paint an entire nation of culturally distinct and intriguing people of terrorism. You, sir, seem to be intentionally misrepresenting me.
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Air travel and the future
Me? I'm burning up all those air miles seeing the places my kids never will.
And if you live in Backwater USA I strongly suggest getting out. Whilst you still can ..
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Hmmm....
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Re: Hmmm....
The problem will be the chaos created between the collapsed current infrastructure and the creation of a newer more efficient system. Replacing the current infrastructure likely will cost AN AWFUL LOT, so the delay (and thus chaos) would be HUGE.
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Re: Re: Hmmm....
maybe an alternative can be built in a decentralized and modular fashion, like a computer network that grows over time. perhaps short regional flights can be replaced with a fast rail or bus system, or flights based on alternative fuels, and those systems can be connected together in time.
whatever it is that will replace air travel (if indeed air travel needs to be replaced) might start with a small build out (compared to the current air travel system), with additional expansions/connections over time as local systems are connected regionally, and regional systems are connected nationally, and national systems are connected internationally.
perhaps the fuel source for airplanes will be replaced, perhaps super efficient or super sonic underground/underwater trains or busses will be built. maybe both will happen and competition between the two will benefit travelers.
there seem to be these huge airports everywhere, maybe those terminals can be gradually converted into the regional and national hubs for the new system.
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Re: Re: Re: Hmmm....
I'm not sure how that differs from the way that the current airline industry came to be...
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YEs the Ekranoplan Cometh
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commercial airlines profitability
There are many examples across the globe to prove their viability. Westjet in Canada as stated in another comment is just one of many. Their business model is just a little different from the major airlines. It is the major carriers, that refuse to change to a more practical efficient business model that is their biggest problem. They seem to think the "market share" is the be all and end all to growth and profitability........ it is not!
The airfreight side of the airline business, the last time I looked, was doing well, it is the passenger side that creates the problems and companies like Westjet have figured it out.........and it is no secret, all the others have to do is copy them and they will slowly become profitable again.
I'm of the opinion, that major carriers don't remodel their companies because they think their governments will bail them out if the situation becomes too hurtful to the economy; it has happened before.
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Flying cars, huh
www.moller.com - The flying car
Obviously expensive (and not out yet), but mass production would make this an option for most people at some point.
Stop living in the past and put these airlines down!
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Flying cars, huh
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flying car
check out the stats for those environmental people. No worse then a car. better then a plan. uses Ethenol and goes 750 miles on a take of fuel. Great for those guys in europe. :)
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Ok, maybe I'm being really dumb...
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Electric Trains.
Commercial aviation was always artificially subsidized by the military, at a whole series of levels. That may have something to do with why John McCain is famously known as "The Senator Who Hates Amtrak."
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Re: Electric Trains.
How does one graduate #894 out of a class of 899?
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Re: Re: Electric Trains.
it's a statistical inevitability that out of a group of x with a clearly defined and ordered ranking that someone will fall in position y within x
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Re: Re: Re: Electric Trains.
Shame on you for trying to reason such silliness. Here in Germany, even designers of autos have PHds, and lecture at prestigious Universities. What is it with your country's desire to settle for such mediocrity?
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Re: Electric Trains.
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Bullshit !!!
There won't be any Spring Break idiots flooding airports
Great news for the rest of us
yet this should be the least of all concernes:
at 7$ a gallon the suburbs of major US cities will start diyng out, the home prices in far suburbs will drop dramatically, making current mortgage meltdown look like a joke
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Back to the Horse and Buggy.
Flying will always be there, and the greedy CEOs of American business will still be flying in their corporate jets even if the large airlines shut down or greatly increase the cost of flight. Air freight will move by rail instead and just take longer to get there. What will fail, or greatly increase in cost, is the airline industry for the average American.
Just another example of the eroding of the average American's standard of living. Amish probably least affected.
(I wonder if anybody in Ethiopia or a like cares about this other than to point and laugh?)
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I've got a wife travelling.
She flies Delta out of Atlanta, the only other direct option being South African Airlines flying out of New York. Both DL and SAA fly 767s, each have one flight going in, and one flight going out. My wife prefers Delta (she's maxed out in her Delta frequent flyer account), and her boss prefers South Africa Airlines (affinity with his frequent flyer card), but he rarely gets SAA, it's booked that far in advance. Delta isn't quite as bad, but I know she's had to leave here earlier and there later due to unavailability of seats.
Those flights are always sold out. There may be a few people that get upgraded at the last minute, so a few people make it on the waiting list. And that's one heck of a flight, that's close to 18 hours in the air, let alone the time spent on the ground.
I know Delta can't be losing money on that flight. That is a very profitable flight for them (and SAA I'm sure).
There are roughly 4 flights from Atlanta to Jacksonville and back every day, and those flights are always full, including the daily 767 between them.
But cut the unprofitable flights too far, and suddenly you can't fill the profitable ones, because the people can't get to the flight to start with.
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Aviation
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