Airspeed, airlines and economics

 This is Part 2 in a series

After the Interstates, it was low-fare post-deregulation airlines that challenged the economics of travel by everyday GA.

In part, trips were getting longer. Baby Boomers ranged far and wide, leaving hometowns for nationwide opportunities. Americans saw a weekend jaunt of 500-1,000 miles as an appropriate getaway or dutiful return home. After airline deregulation, these trips could be taken “for a song.”

But GA’s earlier challenge had been airspeed, the divergence between airline speeds and typical GA travel. Our GA being largely a regional travel mode, Dick Collins’ thumbnail 140-knot criteria for useful cross-country speed stood up well against local service airlines and 160-knot, multi-stop DC-3s. But as turboprops and DC-9 short-haul jets came into regional service, even short airline trips began leaving us in the dust.

GA could still sell itself to places without good airline service or to out-of-the-way spots. Mostly, though, GA business travel migrated to faster turboprops and corporate jets. Others continued to travel in slower GA because 1) their heart (and investment) was in it, 2) it was fun, 3) the family (or multiple associates) traveled for one price, and 4) multiple stops en route were almost free.

The utility of light plane travel did increase as more pilots earned instrument ratings in the 1970s and 1980s. And in the 1990s, new offerings from Cirrus and others got you higher cruise speeds without the retractable gear and costs of a Bonanza. Tax deductions for the self-employed are still attractive, but efforts by the General Aviation Manufacturers Association to cure risk managers’ aversion to employee private aircraft travel had limited results.

A driver of GA travel today is the morass of airline flying post-9/11. (So often did I hear former AOPA President Phil Boyer take joy in being able to travel without removing his shoes in airports!) Airfares still may be low, but they are less often the bargains of a few years back – especially with today’s nickel-and-dime add-ons that allow airlines to recover the billions they lose competing with each other for the lowest airfare on the Internet.

Those who can travel productively by light plane (and the fewer still doing it for their job) enjoy a great capability. But as economics and alternatives change, it’s clear why some elements of GA now eschew the “utility justification” used for decades to counter resistance to rising costs. “Sport Aviation” now emphasizes fun flying for what it is (and no more) as businesses and corporations cut costs and reduce travel.

I hope you find utility in some of your flying. But for most, the fulfillment and psychic payback is justification beyond words or dollars. That’s why many of us today sacrifice for every hour we can get and still fight to preserve our rights and infrastructure for the future.

Next time you travel, perhaps you can save a few bucks on a cheaper airline ticket (or by not checking a bag), then just spend the savings on a joyful hour around the patch some pretty afternoon this spring. OK?

 

 

© 2013 Drew Steketee All Rights Reserved

Comments

  1. You guys are doing it wrong! I have $26,000 in my 172, and $56,000 in my hangar at todays interest rate of return thats almost nothing if it was in the bank and maybe up or maybe down if it was in the market. I pay $445 a year for insurance on the airplane, I have a low time engine and it needs to be ran a few hours every month anyway, so a flight to Port Townsend or Bremerton or Friday harbor for lunch is the perverbial $100 hamburger but it keeps my engine dry and luberacated and me current in the airplane. I burn ethanol free car gas (STCed) and can get 110mph out of 7.3 gph. When we take the airplane on the trip yah it cost me if I go further than my 39 gallon tank ($140 of auto gas) will take me but I can make it to Sacramento or Reno on a tank full and so it cost me $240($6 a gallon) to get back home if it’s the whole family it’s worth it and we get to see a lot of the country that you can’t see any other way better than in a light airplane. Ok, annuals do cost me $388 a year and I only fly it 50-60 hours but it’s still cheaper than renting those 50 hours at $125-150 and hour would be $6250-7500 and I would have to schedule the flights and they wouldn’t like me taking the airplane away for a week or two during the summer. Even with the money I have tied up in the hangar and the airplane, the cost of the insurance and annual and $1300-1400 I burn in gas it’s worth it to me, granted the engine is getting hours on it but at this rate it will reach TBO when I’m dead so what do I care. You can’t take it with you. Jeff in Olympia

    • Jeff; I guess your an “example” that the cost DOESN’T equal the benefit?
      Do I have at least that “right”? I can reccomend a good mutual fund if your concerned about “opportunity costs”!

  2. Yesterday’s posts ended up causing me to lose a lot of sleep! Here are some of my thoughts from 1am (and 3am).

    A major problem with the “utility” of GA that I see is that most folks seem less inclined these days to conclude that “time is money.” They are willing to deal with long drives or inconvenient airline flights to save money. Maybe we’ve become a Nation of Cheapskates, or maybe it’s just the fact that the middle class is declining. This is especially true for pleasure trips.

    I’m an example:

    * My 89-year-old mother lives 560 nautical flying miles or 720 statute driving miles away (via 2-lane roads only).

    * It takes about 13 hours to drive, which can be done in a grueling day if there are two drivers. But an overnight ($100 + meals) is what I do if I’m alone. I drive a car with good mileage, so the round-trip gas cost is about $140. So figure $265 if I overnight. (And a lost day or lost 1.5 days, but I do have good cell coverage most of the way.) And, yes, the true cost of driving is more than fuel, but come on, I drive a Toyota…I only spend money on oil changes, maybe a brake job over 100K miles, and depreciation (I buy 2-year-old cars, for cash, and keep them about 5 years).

    * It is about 6 hours door-to-door to take the airlines (I live 1 hr. from an airline airport, and she lives about 1 hr. from an airline airport). There is one non-stop flight a day between those airports. The latest quote from Southwest (3 weeks out, leave Tuesday, come back Saturday) is $315…it’s often more. Gas, parking, and a shuttle to her town costs about $100 round trip. Call it $425 on average, round trip.

    * If I fly a 35-year-old flying club 182, or compute the true cost of aircraft ownership on an hourly basis, the average flight time is 5.0 hrs. including a fuel/bladder stop. 10 hours round trip, $150/hr. = $1500. (And I’m being generous, as the actual cost of aircraft ownership would be closer $200/hr..)

    Summary:
    Car: $265, 13 hrs.
    Airline: $425, 6 hrs. (7.5 if you change planes), 1.6 times the cost of driving
    GA Rental: $1500, 5 hrs., 5.7 times the cost of driving.

    Folks, I really have to like flying myself to pay 5 times the cost of driving! And that’s to save only 1-2.5 hrs. over the airlines, assuming the weather is good enough to fly myself and I have no mechanical delays.

    And, of course, if 3 passengers were going, then the cost-per-passenger of GA would be about equal to the airlines…but not driving! (In addition, if I had 50-year-old Comanche or Bonanza, I could probably get there an hour sooner but the cost-per-hour would be at least as much as the 182, all-in.)

    Result: Unless several people are going, GA flying is not cost-effective for leisure travel. (Was it ever?) $1500 round-trip to go 1500 driving miles is not practical for a middle-class person to do alone when compared to the airlines or driving. You really have to be “In the 1%” to not notice that kind of cost difference.

    Where GA really shines is when several well-paid people are going, the weather is good, and the airline service is lousy. But without all of the preceding, it’s not cost-effective. And therefore, light GA will continue to decline as a recreational or pleasure travel tool. And I HATE that!

    • “I HATE that”! Big band swing – my preference in music and a little before my time – sure beats (no pun intended) the popular crap we’re subjected to today – I have a collection of CD’s in my car – thank goodness! Unfortunately, I think pure recreational aviation is suffering the same fate. But continuing to “hang on” to the inevitable demise of the pure recreational or personal flying is, frankly, fruitless. A solution; like the few jazz clubs that feature “swing” on their venue, a cost effective airport/airfield where recreational aviators AND non-aviators, could share thier “passion”for flying – BUT this would mean volume memberships and DOLLARS to support! Are the “minority” of recreational pilots and groupies WILLING and able to pay for the “priveledge” – that remains to be seen!

    • Whoops, forgot to mention: To be able to safely fly light GA aircraft, you need to be practicing your flying skills at least a couple hours a month, attending courses and seminars, reading magazines, getting flight instruction, etc. If you’re instrument rated (and you’d better be if you want “utility”) and want to be even minimally safe, you need to be flying under the hood at least 10 hours a year and getting some simulator time once or twice a year.

      Result: You’re going to spend somewhere around $5,000 to keep a minimal amount of currency. So the “true” cost of light GA is more than just the $150/hr. airplane cost. If you fly 100 hours a year (almost no one does), the true cost of flying is closer to $200/hr. And, again, that’s in a rental…if you own it, it’s $250-$300/hr., all-in. And that’s for a well-used aircraft from the 70s or 80s.

      (The sad fact is that most middle-class pilots these day are NOT maintaining a safe level of currency due to the cost and time. I have been a CFI for over 25 years and the skills of the pilots I give BFRs to continues to decline. It’s getting scary…I seriously would not let my family fly with the majority of pilots I fly with. They are fine at some of the basics, but throw anything even remotely unusual at them, and they are not safe. That’s probably fine if you stay local, but if you want to use your plane for distance travel, you need to be spending some serious time and money to stay safe.)
      ——————————————————————–
      Alright, so, travel by light GA aircraft is either for the 1% or it’s for business people who understand that “time is money.” Yet, where do GAMA members advertise their aircraft? In flying magazines instead of business magazines. The fact is, there is “A Company Plane For Every Sized Company,” but no one’s promoting that. GAMA members need to be advertising to businesses that have a need to travel within 600 n.m. (Construction, architecture, banking, real estate, and health care come to mind.) Why aren’t they advertising in Construction Monthly or whatever their trade journal is?

      Perhaps the industry needs a generic joint industry marketing AND SALES campaign. Not about learning to fly, or the joys of recreational flying, but about the utility of private aircraft for many businesses. And not just about turbines, either. (GAMA members do advertise individually their jets in the Wall Street Journal, etc., but that means they are missing the vast majority of SMALL businesses who could afford a piston-engine aircraft.)

      There really is a plane for every company’s budget, particularly if you include the used segment and co-ownership.

      Meanwhile, broker-dealers don’t call on local business prospects to see what their travel budgets might be and how they could save them money and time. Take it from me: I’m a broker, and I just wait for the phone to ring. I haven’t cold-called my local regional bank that has branches all over the state. Or the 10-hospital regional chain. Or the architecture firm that bids on jobs all over the region. We haven’t been trained in that type of sales (cold calling). We haven’t been trained, and don’t have the tools, to prepare an analysis of the company’s savings potential if only they bought the $200,000 used Bonanza I’m making a $5,000 commission on. We can’t afford to produce classy marketing materials to hand out. We don’t go to Chamber of Commerce meetings and try to meet traveling executives (who are probably too busy to attend those meetings anyway). Mostly, we’re just too lazy and don’t like the rejection that comes from cold-calling. Or we’re short on ideas. Or don’t know where to begin. We need help from the industry, or we need a new breed of salesperson who is trained by the industry and sent all over the region…and not just to sell new aircraft, because a $700,000 Cirrus is not the solution for smaller firms.

      The utility-of-GA message just isn’t getting out. And “out of sight, is out of mind.” Most businesses haven’t even considered owning a plane. And when they have, they’ve wrongly concluded that it’s either too expensive, too unsafe, or that they’d have to learn to fly the darned thing. Which brings up a final point: We don’t need more PILOTS…we need to sell more PLANES. Pretty much every town has a pilot who could fly a company’s plane 5-10 days a month for $250-$300/day. We need to quit acting like everyone who buys a single needs to fly it himself/herself. That’s not realistic and it’s not conducive to safety.

      Will any of the above happen? Nope. There just isn’t enough money in selling light aircraft, when compared to jets, to get anyone interested enough to put together (and fund) the JOINT industry effort that is needed to SELL light GA’s utility.

      Put a fork in it…light GA travel is almost done. All that’s left is recreational flying, which is fine, but isn’t big enough to sustain an entire system of FBOs selling 100LL, flight instructors, and flight schools.

      I hope I’m wrong. Sniff, sniff.

      • Marc, KIndly -NOW – got to our site – either get-aviation.com or aviationbiz.us
        I KNOW you’ll be on board with MIke and I once you read some of the REALITY on our blogs! ALL you mention is EXACTLY what we have been toting – SELLLING to the RIGHT audience. We recently “recommended, the “Business Pilot Program”, etc plus all the things you stated, to a flight school in a very good market – 20,000+ folks that could either AFFORD to buy a plane for business or recreational (distance) travel. BUT, guess what – their still hyping the “wow” factor – they just added (leaseback – so no capital outlay) a Pitts S-2 – boy, is that going to draw a lot of BUSINESS use prospects!The last several paragraphs in your reply are DEAD ON! Lets exchange ideas! Contact me at your leisure -rodbeck@optimum.net

      • Drew Steketee says:

        Marc Cohen: (Your thots about targeted PR and marketing e.g. to a Construction Management magazine)

        In fact, the industry did that for many years, usually within specific programs (BE A PILOT, TAKEOFF, CONTACT, etc.) and I ran/designed several of those efforts plus decades of day-to-day work doing the same. Problem is, not much is being done now post-BE A PILOT due (presumably) to the economy, shift towards marketing and selling jets etc. But there are still believers in “concept sell” which can reach down to use of single-engine aircraft. In the words of Cessna’s Phil Michel (retired about the time BE A PILOT ended), “You know that some day, they’ll be doing this again.” (The implication: “They” just don’t know it yet.)

        If you want more detail on how and when this marketing and PR was done, I can comment again. It wasn’t ChickenSh**, believe me, even if the average pilot didn’t know it was going on. After all, the existing pilot population was NOT the target of this extensive work. -ds

  3. Sure…for some trips the airline will save you time, and sometimes save you money. For the vacation traveler, the airline and price of an advance purchase ticket is the only way to get somewhere.

    Lets look at the real numbers at they apply to someone that is using a single engine or light twin for business. You need to go from Sarasota to Tallahassee FL, which in a Beechcraft Bonanza is about an 1:30 each way, or a 5 hour drive. The airlines take you through Atlanta, it is an all day event, meaning you will be overnight. The cost of the round trip on the airline is $800 + motel + meals. The A36 @ $250/hr will cost about the same for 1 airline ticket, what about if you bring along the sales manager?

    There are many examples of this, unless you live in a major metropolitan area, the airlines just don’t work. Throw in the inconvenience of their schedule, the no-flexibility rule, and the TSA shaking you out every time you board the airplane…hey folks, this is our problem in GA…we should have people standing in line to BUY an airplane!

    This example is identifying “who is your best customer”, yet the style of business operating in GA IGNORES this person….anyone get the idea?

    get-aviation.com

  4. Drew; Let me pose this question to you, dare you answer HONESTLY.
    WHO do you think is the BEST customer/aviation consumer for:
    (Kindly, from a GA business persons perspective)
    1. Recreational – leisure/sport/hobby/social – little or no utility value
    2. Recreational – principal ultility value
    3. Piston/turbo-prop single or light -medium twin, 90–100% utility value

    And please – spare the “neutral”, politcaly correct or vague answers!
    NOTE: Pleading the “5th” will not suffice!

    • Drew Steketee says:

      Rod:

      Happy to answer honestly, always have.
      But frankly, I don’t understand the question.
      So, before I “dare,” please tell me:

      What are you really asking?

      Standing by (without “neutral, politically correct or vague answers,” by the way, except when pressed for time when, in which case, I say so.)

      Drew Steketee

      • Drew; Forgot your BUSY at “Tan & Fly” – no rush!
        Curious since you have “time” at GAMA, etc, and IF you were
        heading a marketing/sales dept presently. WHO do you think the BEST
        GA consumer/customer/prospects (sales) for the forementioned (1-3) folks are?
        At your leisure is fine! Thanks, Rod

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