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Future Of The Airline Industry  
User currently offlineBoeing909 From Germany, joined Dec 2007, 24 posts, RR: 0
Posted (6 years 4 months 1 week 5 days 13 hours ago) and read 3164 times:

In the German media the future of the airline industry is widely discussed at the moment. The following discussion points have been picked up several times:

* Air Berlin is in big trouble, bankruptcy not very unlikely (some analysts say stock price can fall to 0 Euros).
* An oil price of 155 dollars per barrel is a barrier for most airlines. Higher prices mean that most of the airlines will not make money out of operative business (according to a Credit Suisse study).
* The operating margin of the airline industry in the last 60 years was approximately 0.3 (a little bit over zero) percent.
* Bargain prices of 99 Cents will disappear.
* Fares of 50 Euros one way will be very seldom. The prices will rise to 100 - 150 Euros one way.
* Lufthansa thinks about starting with 139 Euros instead of 99 Euros as the cheapest offer.
* In general a lot more (loss producing) destinations will be cut. A lot of non-stop connections will be operated as via-connections.
* At the moment most of the planes are "fully booked" but at prices which are far to low. The airlines are not making enough money with their strategies.

So what does all this mean? Will travelling become a luxury again? What reforms does the airline industry need?

Why do the airlines do not put more pressure in the plane manufacturers to develop more efficient airplanes? The new models (Boeing 787, A 350, A 380 etc.) sound good, but are they efficient enough? Other models need to be substituted as well (Boeing 737, A 320 series etc.). Aren't the plane manufactures with their developments 10-20 years behind the markets needs?

6 replies: All unread, jump to last
 
User currently offline2175301 From United States of America, joined May 2007, 1075 posts, RR: 0
Reply 1, posted (6 years 4 months 1 week 5 days 9 hours ago) and read 3124 times:

I actually think the future of the airline industry is solid; but, it will be a different airline industry.

Gone will be the cheapest leisure fares - which will cut a lot of traffic. My estimate is that the bottom 20% of passengers will now opt to do something else for their vacation (or weekend) instead of jetting away somewhere.

As far as efficiency. The aircraft companies do their best to design the most efficient aircraft when introducing a new model. There are real laws of physics at work - and technological limitations as well. You just cannot tell a Mfr to design a plane that is "x" efficient. Public perception and flight timeliness also plays a roll. I believe that a prop driven blimp is the most fuel efficient aircraft for anything but the shortest distances. I doubt their is anyone willing to take that long to travel again...


User currently offlineHercPPMX From United States of America, joined May 2008, 196 posts, RR: 0
Reply 2, posted (6 years 4 months 1 week 5 days 8 hours ago) and read 3085 times:

I think that the Airline industry will see some shifts. I believe like stated above that some of the weekend and pleasure travelers will find other ways to get from point A to point B. I also think you'll start to see a decline in some business travel. In Europe I believe that you will see people once again shift to trains to cover anything under a 4 hour flight. I think that in the United States where you don't have the same rail infrastructure as in other parts of the world will see smaller routes frequencies drop to ensure a full pax load on each flight, while fares get as high as airlines can get with out driving away too many paying pax. I think you may also start to see some high density a/c like JAL & ANA have in japan.

Quoting Boeing909 (Thread starter):
Aren't the plane manufactures with their developments 10-20 years behind the markets needs?

I think that the plane manufactures deal with issues as they start to appear. Even once they have a proposed solution, it still needs to be tested and certified for flight. I was reading the thread about the f.b. Air show and Airbus and P&W with the GTF engine. Its still gonna take then 2.5 years to bring it the commercial market due to test and certs.

All of this of course just my humble 2 cents.



C-130; it's a love-hate relationship
User currently offlineNaritaflyer From Japan, joined Apr 2006, 549 posts, RR: 1
Reply 3, posted (6 years 4 months 1 week 5 days 8 hours ago) and read 3057 times:

Only ignorants start calling for the demise of the airline industry. Just because high-cost legacy airlines are not able to adapt does not mean the industry is in trouble.

The only thing that will change is that there will be more seats on every airplane than we are used to.

We are still going to find cheap fares. It will be on different airlines than we are used to.

As well, we may fly routes differently than we are used to. Mmore hub-to-hub flying and less nonstop long thin routes.


User currently offlineExaauadl From , joined Dec 1969, posts, RR:
Reply 4, posted (6 years 4 months 1 week 5 days 6 hours ago) and read 2974 times:



Quoting Boeing909 (Thread starter):
* Bargain prices of 99 Cents will disappear.



Quoting Boeing909 (Thread starter):
* Fares of 50 Euros one way will be very seldom

Geez I would hope those wouldnt even exist with $20 oil

Quoting Naritaflyer (Reply 3):
Only ignorants start calling for the demise of the airline industry

Agree completely. I have a 1984 OAG and CLT which probably has close to 400 daily flights today had fewer than 150 in 1984. Capcity will decline and youll pay a lot more to fly. There will bew fewer "long thin flights" youll have to connect in the traditional hubs like SFO to go to Asia, JFK to go to Europe and ORD to go accross the country.


User currently offlineBmacleod From Canada, joined Aug 2001, 2351 posts, RR: 0
Reply 5, posted (6 years 4 months 1 week 5 days 6 hours ago) and read 2933 times:

If new types of jet engines and jet fuel are fully developed with enviromental issues taken into consideration, then air travel will continue for another 30-50 years or until space travel becomes commonplace.

[Edited 2008-07-19 11:18:57]


The engine is the heart of an airplane, but the pilot is its soul.
User currently offlineCAL764 From United States of America, joined May 2008, 377 posts, RR: 0
Reply 6, posted (6 years 4 months 1 week 5 days 2 hours ago) and read 2825 times:

Boom-Bust-Boom-Bust-Boom-BUSTED! is the way it looks right now. Seriously, it'll maintain through these tough times.


1. Fly to Win 2. Fund Future 3. Reliability 4. Work Together CO: Work Hard, Fly Right...
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