Source: Phoenix Business Journal Author: Adam Kress 02/10/2009
Subject Concerned: Government Opinion Airlines Airport
New projections from Boyd Group International predict a gloomy few years for the airline industry.
U.S. airlines likely will carry 6.6 percent fewer passengers this year than in 2008, and numbers will remain lower than usual through 2010, according to the Evergreen, Colo.-based airline research and consulting firm.
Passenger counts on U.S. airlines may not return to 2008 levels again until after 2014, Boyd Group International said in its latest research review.
Boyd predicts 578 million passengers will travel on U.S. airlines in 2009, down 41 million from the 2008 total of 619 million.
"Depending on the depth of the recession, the annual decline could reach 93 million in 2010," Boyd said in its report. "Even in the most positive scenarios, there will be 42 million fewer passengers in 2010 than in 2008."
Passenger counts at Phoenix Sky Harbor International Airport were down by nearly 2.3 million, or 5.4 percent, in 2008 compared with 2007. The Phoenix airport served about 39.9 million passengers in 2008, down from 42.2 million in 2007, according to the Phoenix Aviation Department.
The report from Boyd said airlines likely will take in US$25 billion less in fare revenue through 2011 than they would have if traffic had stayed at 2008 levels, assuming no fare hikes.
"Using 2008 as a baseline, the decline in passengers expected through 2011 represents massive declines in aviation revenues," the report says.
The decline also means a projected US$4.9 billion drop in federal taxes and fees paid by airlines through 2011 as well as a US$573 million drop in airport passenger facility charges, the Boyd report said.