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Other People’s Money

3 Comments | This entry was posted on May 05 2010

A couple of months ago, my son announced that he “needed” this particular red sweatshirt.  It was absolutely vital that he have it.  In fact, civilization as we know it might actually end, should he not get this shirt.  Since I know that he has a closet full of sweatshirts, albeit none of them red, I didn’t see this as a crisis of need, more like a crisis of want.  In the interest of saving civilization, I told him that we could pick that up on our next trip to the mall; however, he would need to pay for it out of money he’d earned.  Hold the phones!  Money he’d earned?!  Magically, the crisis evaporated; the sweatshirt was no longer needed.  Civilization was saved.

Last week, US Airways CEO Doug Parker announced that maybe the airlines don’t need the NextGen ATC system they’ve been clamoring for.  ATW Online quotes Parker as saying at the carrier’s media day in Phoenix,”There is not a capacity issue in the United States right now as it relates to air traffic control, so putting in place NextGen ATC, while it makes all the sense in the world, isn’t going to save the airlines dramatic amounts. . .So our position is so long as we have to pay for [flight deck equipment], we prefer not to have it.”  And a recent Washington Post editorial indicates that US Airways is not alone in it’s unwillingness to foot the bill to retrofit their fleets with the necessary equipment.  In a rebuttal to the editorial, the Air Transport Association’s James May says that the article misses the point, that airlines are already paying billions in taxes into the Airport and Airway Trust Fund and that the FAA is the one who will realize multiple millions in savings; so, the government should be the one to pay for aircraft upgrades.

The logic eludes me on this one.  Why should the government pay to upgrade a private asset, even if the upgrade is to allow the asset to communicate with a government infrastructure?  The funds in the Airport and Airway Trust Fund won’t cover the costs of building, launching and maintaining all of the satellites required for the improved ATC system.  Personnel retraining, alone, is going to be a massive government expense.  In the end, overall savings will eventually cover these costs.  The airlines have lobbied for NextGen implementation saying that the more direct routes will reduce fuel costs, allow for better fleet utilization and, perhaps even reduce the number of ATC delays, allowing the scheduled airlines to operate more efficiently.  They should, therefore, be able to operate more profitably.  May doesn’t believe that airlines should pay for decreased government costs, but he somehow thinks it makes sense to require that the government (or better yet, general aviation through user fees) should have to pay for decreased airline costs?  Again, I fail to see the logic.

Interestingly, the Washington Post editorial points out that, in 2007, Southwest Airlines was the first carrier to commit to using its own money to retrofit its aircraft and that more than 60% of their fleet will be NextGen ready within the next few weeks.  Who has more credibility here - US Airways, a carrier that has lost money hand over fist for the past several years or Southwest Airlines, a carrier that has used innovative practices to turn a profit during the same time period?

Whether it’s a teen-ager, a corporation, or a government, it’s always easy to spend other people’s money.  You can easily measure commitment to a belief or project when you see how many of their own resources an entity is willing to use to see it through.

In this case, it looks like only the airlines that are interested in operating even smarter are the ones that are already the most profitable.

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Greener Flight

0 Comments | This entry was posted on Mar 28 2010

Looking at the con-trails that aircraft leave in the sky, what kid hasn’t said something about the airplane’s “smoke?”  While those trails are more  water vapor condensed around particles than they are smoke, there’s no denying that aviation has a huge carbon footprint – from aircraft and ground equipment emissions to de-ice and mechanical fluids to passenger trash.

According to the Pew Center on Global Climate Change,  ”Aviation and marine transportation combined are responsible for approximately 5 percent of total GHG emissions in the United States and 3 percent globally and are among the fastest growing modes in the transportation sector. Under business-as-usual forecasts, CO2 emissions from global aviation are estimated to grow 3.1 percent per year over the next 40 years, resulting in a 300 percent increase in emissions by 2050. … Controlling the growth in aviation and marine transportation GHG emissions will be an important part of reducing emissions from the transportation sector.”  The concern is less about aircraft emissions today and more about their rapid growth and exponential increases.  Reducing this footprint is going to take a concerted effort from several sectors including fuel research, aircraft design and air traffic control.

The aviation industry is already set to benefit from alternative fuel research.  AZoCleantech reported on 25 March 2010 that “According to the projections in the “Camelina Aviation Biofuels Market Opportunity and Renewable Energy Strategy Report,” released by Biomass Advisors’ biofuels market researchers, the production of Camelina biofuel is set to reach one billion gallons by the year 2025.”  While this certainly won’t supply all of the fuel needed by the aviation industry, it won’t have to.  As we discussed previously, DARPA has developed a process to produce fuel from algae at the same cost as fossil fuels, with production to begin as early as 2013.  The new fuel sources, in theory, would be carbon neutral since the CO2 emitted by the aircraft would be used again by the fuel-producing organisms.  In addition to using more eco-friendly fuels, the industry is designing more efficient aircraft.

Jets used by airlines have more composite material in their bodies than ever before, although aluminum is still the major component in airliner construction.  Increasing the composite percentage from 2% in the 1950s Boeing 707 to 10% in the 2000s Boeing 777 has lightened the aircraft making them more fuel efficient.  The Hawker 4000 with its all carbon composite construction fuselage really lightens the load.  Fuel efficiency is dramatically increased using these new construction materials and structural changes like winglets, which increase efficiency by decreasing drag.

This week, the United States Senate passed a measure to reauthorize the FAA and to pursue implementation of the NextGen air traffic control system.  There are still several details to be worked out with the system and the electronics required to make it work; but, once in use, it will allow aircraft to fly more direct routes between origin and destination, allowing for more efficient use of aircraft and fuel.

Will flying ever be completely eco-friendly?  I don’t think so, or, at least, I can’t really envision it.  On the other hand, how many children of the 50s, 60s and 70s ever really believed that we could have a telephone that would fit in our pockets, play all of our music, remind us of our appointments and connect us to the world?   Maxwell Smart had the best and his was just a shoe!

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United States Senate Finally Passes FAA Reauthorization Bill

0 Comments | This entry was posted on Mar 26 2010

The U.S. Senate finally got down to business and did something constructive!

Monday, they passed a reauthorization bill for the FAA that includes funding for the NextGen air traffic control system.

The great news for General Aviation is that there are no user fees in this bill. The Federal Excise Tax for fuel goes up, but we can live with that – especially if we get something for it.

This has been a long battle to fund the system without implementing user fees; but, it looks like for at least the next year or two we can take a breather. Hopefully, those user fees don’t get brought up again.  The possibility exists, though; so, we will have to be vigilant.

Included in the bill are provisions for changing training and pilot qualifications for the regional airlines prompted by the Colgan Air crash last year.

An article posted on Tuesday, 23 March 2010, by Charles Spence, Washington, D.C. correspondent for General Aviation News, says the following:

Both the Senate and House bills were passed without user fees, but the Senate version raises the fuel tax from 22 to 38 cents per gallon to help fund modernization of the aviation system. The Senate bill passed by a vote of 93 to 0.

Craig Fuller, president and CEO of the Aircraft Owners and Pilots Association (AOPA), said that the final bill will give the FAA “the long-term support it needs to move forward with the crucial work of modernizing our air traffic control system, preserving our network of airports and maintaining the safest air transportation system in the world.”

Speaking for the National Air Transportation Association (NATA), James Coyne, president, expressed thanks to the Senate for approving a bill devoid of user fees but that provides a fair jet fuel tax increase.

Ed Bolen, president and CEO of the National Business Aviation Association (NBAA), welcomed passage of the bill “to fund the FAA and continue transformation to a Next Generation Air Traffic Control — NextGen — aviation system.” He added that the NBAA and other general aviation organizations have been strong advocates for proposals to modernize the nation’s aviation system and that passage of the reauthorization is a good step in that direction.

Pete Bunce, president and CEO of the General Aviation Manufacturers Association (GAMA), echoed those comments, saying that his association was pleased with passage of the bill, which takes a number of critical steps needed for the acceleration of NextGen.

No user fees and a $.16 per gallon increase in the fuel tax (under the Senate version) is something we can all live with. The Senate’s passage, with its vote of 93 to 0 is amazing in itself.  It’s amazing that all parties in D.C. can agree on anything these days.

Conspicuously absent from the comments of the various groups representing aviation interests are comments by the ATA, which represents the airline industry.

Will the airlines applaud this bill as well?  

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Can Congress Finally Pass a Bill to Fund Modernization of Our Air Traffic System?

1 Comment | This entry was posted on Mar 02 2010

It looks like Congress may finally get back around to figuring out how to pass a bill that will fund the Next Generation Air Traffic System (NexGen). Hopefully, I will see this happen in my career, I still have 15 years left if all goes good.

It is frustrating to me that the lawmakers want to wrap up controversial provisions into a bill thats primary purpose is not controversial. Everyone in aviation agrees that the traffic control system needs to be modernized. It will save fuel and time in the air which is both green and more productive for our economy. It will also increase the margins of safety with better traffic management. Both general aviation and the airline industry support the development of NexGen.

So, what is the hold up?

Somehow congress can not seem to simplify things and get something done.

They have to add in provisions that we can’t all agree on so things get stalled and nothing happens. What can we not agree on?

  • Who pays for it? GA versus Airlines
  • Should we be auditing European Repair Stations? A Union Protectionist Issue
  • Should we make it easier for FedEx employees to unionize? Another union issue. Big company against the union
  • Passenger Rights? The People versus the Airlines
  • Pilot Work Rules and the Oversight of the Airlines: Pilots versus the Airline Management and additional regulations 

In that list that I just mentioned, which of those issues, if any,has the first thing or, for that matter, anything at all to do with modernizing our air transportation system through the deployment of new technology? With the exception of who pays for it, none! And I will bet you that we can come to some solution on who pays for it.

Maybe I am simple-minded, but why can’t these guys in D.C. simplify this and pass a clean bill that funds what we all agree needs to happen and fight it out over the rest in separate bills? Is there some legislative rule against simplicity? If there is, then we need to change the rules.  Or maybe we just need to fire the rule-makers and vote in some new ones who understand how to get things done.

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