Plane Conversations

Yesterday’s blog post argued that we cannot price any air transportation correctly until we price all air transportation correctly.

This means that if a trip were priced in proportion to it’s distance, then competition between airlines would amount to battles for internal efficiency rather than price wars dependent on short haul passengers subsidizing long haul passengers – plus “gotcha” fees, and unbundled services, increased government regulation, etc.

This would also allow smaller aircraft to be priced correctly in a time/value model…

The long-term view of wrong pricing

Livability is defined in terms of employment, safety, crime education and transportation. City planners, communities, and transportation officials allocate money towards projects, services and amenities that balance these objectives.  They also must react to the influence of external forces. The airlines have a disproportionate power to impact an entire economy by manipulating prices and services.

Losing the proximity war

Without proportional pricing, planners do not have a built-in proximity bias that can support multi-mode projects such as rail, bus, and ferry services.  If the price is the same to fly 500 miles as 3000 miles, a form of tunnel vision in regional economic development may appear.

Only 6 airports have direct rail service

Negative incentives

The hub and spoke system also introduces negative incentives to regionalization.  The time that it takes to travel between non-hub locations 500 miles apart often exceeds the time it takes to fly to a distant hub 3000 miles away.

Yet, families and friends want to disperse in much shorter distances.  Small companies want to branch out in smaller segments.  A regional tourism industry is easier to support than attracting distant tourists. Innovation clusters need space to diversify.  The flawed airline pricing model combined with profit driven hub and spoke economics may actually thwart natural growth in favor of unsustainable growth.  It makes little economic sense to disaggregate people from the land that they occupy.

Social Flights is much more than a ride-sharing system for jets.  Social Flights is a social organization concept that allows air transportation to serve the needs of communities as people reorganize themselves in the Digital Age.   Social Flights allows for rapid and effective air service to be deployed to the natural foundations of economic growth instead of trying to force growth to occur wherever the airlines choose to fly.

Smaller aircraft can fly efficiently between smaller markets as long as the price can be compared to the same time/value criteria  as larger jets. People have extraordinary access to information from which to make superior decisions. However, when the wrong pricing model distorts the right decisions, only the best-worst decision is available.  This is inefficient – it’s time to take off the blinders.

The Federal Aviation Administration is more than just a dour old government bureaucracy.  The FAA also collects and publishes very important information.

This chart tells a very important story.  It says that the economy depends on aviation as much (if not more) than aviation depends on the economy.  So when Social Flights talks about private jets, it’s a whole lot more than wealthy people keeping their shoes on. Private aviation is in fact an important conduit for economic growth.  The way that we organize aviation assets such as aircraft, operators, airports, and support services can have a profound impact on a region.

For all economic development professionals:

These statistics should be stark.  If your community has air service, then the products and services that your community can trade will be 69 times higher in value than ground transportation such as trucking routes.   Yet many economic development reports treat these two modes roughly equal.

Furthermore, the market is huge; 1/2 Trillion dollars worth of products are flying over your head and 1/4 Trillion dollars worth of direct expenditure is looking down at you through an impenetrable window – EVERY YEAR.  And, that’s just the tangible value. Ideas, knowledge, wisdom, trust, influence, and experience are all extremely expensive to create on your own or by trial and error.  Yet this value is readily stored and transported in the cabins of aircraft.  This intangible value far out-weighs anything that can be carried in a truck.

What is truly surprising is that it only requires 2 million people to keep 2 trillion dollars worth of value aloft.  As such, every job that an economic development office creates in aviation, can potentially return 500,000 – 1,000,000 dollars in value to a community.  If a community is going to “buy jobs” with their taxes, they should buy aviation jobs.

Likewise, it would NOT be wise to lose control of this valuable resource to the whims of the airlines or outside corporate charter – their bottom line is not the same as yours.

Social Flights now brings a complete aviation solution to your community.  Our CASP (Community Air Service Program) can provide a community with modern aircraft, operational knowledge, and certification authority to operate your own public charter airline.  The connection is clear – airplanes equal money.  Give us a call, let us design your community air service program to integrate with your hotels, restaurants, tourism board, artistic community, and industries.

After all, that is what community is all about.

Economic Development is on everyone’s minds as people realize that their local economy can have a dramatic impact on the their position in the next largest markets.   Now, data is converging so rapidly with the travel experience that opportunities for unique locations to provide unique experiences are truly profound.

From Wikipedia:

Economic development generally refers to the sustained, concerted actions of policymakers and communities that promote the standard of living and economic health of a specific area. Such actions can involve multiple areas including development of human capital, critical infrastructure, regional competitiveness, environmental sustainability, social inclusion, health, safety, literacy, and other initiatives. Economic development differs from economic growth.

Look at the photo above and the Wikipedia entry below it.  It is literally possible to visualize ALL economic indicators in a single flash of an IPhone.  Human capital cannot readily organize without education, transportation, clean environment, social inclusion, safety, and health services.  A community desirable to its citizens is a community desirable to its markets.

This goes without saying for cities that have grown to a size where major airports have become almost a scourge – many of these cities themselves began as a cross roads for land, water, or train transportation in their respective histories.  Efficient air transportation without the “crossroads”  may hold a distinct economic advantage for communities where the access to economic information is equalized by the Internet.  In other words, all things being equal, travelers will prefer a location that is relevant, pristine, uncrowded, and welcoming.

Social Flights is pioneering the concept of the Community Airline, specifically termed “Public Charter”.  The idea is simple; there is very little that a major airline can do for a small community that a small community cannot do for itself, better, faster, cheaper, and without sacrificing safety – all within the existing regulatory environment.  Social Flights can help communities to acquire, maintain, market, and operate modern aircraft which can be deployed on a schedule that suits the community priorities.

Look at the picture again – this is the mural upon which communities will define themselves in the digital age. Social Flights provides all the economic development benefits of an airline without the burdens of a hub airport