FAA's changing '1 billion passengers' forecast


If you were at FAA's annual Aviation Forecast Conference in 2001, you would have been told that US airlines would pass the magic mark of 1 billion passengers carried annually…in 2012. If you are sitting at this year's FAA forecast event in Washington, as I am, the agency is telling you that US airlines will carry 1 billion annual passengers…in 2024. That's three years later than last year, when FAA predicted the 1 billion mark would be passed…in 2021. In 2008, FAA predicted the milestone would be reached by 2016. In 2010, by 2023.

I don't bring this up to disparage FAA's forecasting; predicting the twists and turns of the air transport industry is hardly a simple matter. FAA is just going by the available data and making its best guess.

But it's important not to take the numbers too literally; FAA itself is the first to point out that an unexpected economic shock or per barrel oil prices skyrocketing could change its forecast quickly. It's also worth asking if the mark will ever actually be achieved.

US airlines carried 730.7 million passengers in 2011 and are expected to carry about the same number this year. Growth has stagnated. US mainline airlines' system capacity is essentially the same now as in 2000. Overall, all US airlines' domestic capacity is down 7% since 2001. Mainline airlines offered 16% less domestic capacity in 2011 than in 2001, according to FAA.

Is it possible the US airline market is mostly matured, that there just aren't that many more people per year in the country who want to, or can afford to, fly? Maybe the 1 billion annual passengers mark will be forever elusive.

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