Airlines cut small jets as fuel prices soar

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Airlines cut small jets as fuel prices soar

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MINNEAPOLIS (AP) -- The little planes that connect America's small cities to the rest of the world are slowly being phased out.
Airlines are getting rid of these planes - their least-efficient - in response to the high cost of fuel. Delta, United Continental, and other big airlines are expected to park, scrap or sell hundreds of jets with 50 seats or fewer in coming years. Small propeller planes are meeting the same fate.
The loss of those planes is leaving some little cities with fewer flights or no flights at all.
The Airports Council International says 27 small airports in the continental U.S., including St. Cloud, Minn., and Oxnard, Calif., have lost service from well-known commercial airlines over the last two years. More shutdowns are planned.
Travelers in cities that have lost service now must drive or take buses to larger airports. That adds time and stress to travel. St. Cloud lost air service at the end of 2009 after Delta eliminated flights on 34-seat turboprops. Now, passengers from the city of 66,000 have a 90-minute drive to the Minneapolis airport 65 miles to the southeast.
Roger Geraets, who works for an online education company based near St. Cloud., flies at least twice a month from Minneapolis. He used to connect from St. Cloud. Now he drives, leaving an extra half hour for bad traffic. There are other headaches. Parking at St. Cloud was free, but in Minneapolis it costs $14 per day. And getting through airport security in Minneapolis takes longer.
Another city without service is Oxnard, 60 miles northwest of Los Angeles, which lost three daily turboprop flights operated on behalf of United. The airport's website advises travelers to catch a bus to Los Angeles International Airport.
Atilla Taluy, a tax preparer who lives in Oxnard, ends up driving or taking the shuttle to Los Angeles. "In morning traffic, it becomes quite a burdensome trip," he says.
Pierre, S.D., will lose Delta flights to Minneapolis in mid-January. Pierre officials are waiting to find out whether those flights will be replaced or whether the city will be left with only Great Lakes Airlines flights to Denver. The Denver flights add almost 600 miles in the wrong direction for people who want to fly from South Dakota's capital to Washington, D.C.
"I don't know if they really care about (passengers) in the small markets," says Rick Steece, a consultant for the Centers for Disease Control who travels overseas from Pierre two to three times a year.
In the late 1990s, when jet fuel cost one-fourth of today's prices, the small jets and turboprops were a profitable way for airlines to connect people in small cities to the rest in the world. The flights attracted business travelers who tended to pay more for tickets.
Airlines loved the planes. Bombardier and Embraer sold more than 1,900 50-seat jets during the late 1990s and early 2000s.
"We all got carried away with it," says Glen W. Hauenstein, Delta's executive vice president for network planning, revenue management and marketing.
Then jet fuel prices soared. They're at $3.16 per gallon today, up from 78 cents in 2000. That's changed the economics of small planes.
For airlines, it all comes down to spreading fuel costs among passengers. A Delta 50-seat CRJ-200 made by Bombardier takes 19 gallons of fuel to fly each passenger 500 miles. Fuel usage drops to just 7.5 gallons per passenger on Delta's 160-seat MD-90s over the same distance.
So while the bigger jet burns more fuel overall, it's more efficient.
Delta is moving away from small jets more aggressively than other airlines. It will eliminate 121 50-seat jets from October 2008 through the end of next year. That will leave it with 324.
Lynchburg, Va., lost Delta's three daily flights on 50-seat jets earlier this year, although US Airways still flies similar jets there.
Airport manager Mark Courtney says Delta also served nearby Roanoke and Charlottesville, Va., each about 60 miles away, so it may have figured its Lynchburg customers will drive to those cities to catch a flight.
Lynchburg is the home of the 2,000 workers for French nuclear services company Areva, and its largest international destination had been Paris by way of Delta's Atlanta hub, Courtney says.
Some Delta routes served by 50-seaters are getting bigger planes instead. Delta's Atlanta-Des Moines flights are on larger MD-88s, which seat 142, and it has shifted the mix toward larger planes between Atlanta and Birmingham, Ala., Nashville, and Savannah, Ga., too.
United Continental Holdings Inc. still has 354 50-seat jets. But that number is expected to shrink, said Greg Hart, the airline's senior vice president of network.
Continental's effort to get rid of its 37-seat planes shows how eager airlines are to quit flying them. It has 30 of the jets under lease, some until 2018. Twenty-five are grounded. The rest are subleased for $6 million less than Continental is paying for them.
American Eagle, which feeds traffic to its corporate sibling American Airlines, owns 39 of the same 37-seaters . But 17 of them were parked as of the end of last year. Parent company AMR Corp. had been trying to sell some of those planes in 2009 but couldn't get any buyers.
Many travelers won't miss the small jets.
One of them, Tony Diaz, is a technology support manager from Dallas. He was changing planes in Minneapolis on his way to Moline, Ill. The second leg was a small Delta jet.
"The larger planes are definitely better to ride in," he said, glancing down at his larger-than-average frame.
There's still a market for larger jets, which allow airlines to spread out fuel costs.
Nearly all so-called regional jets sold between 2010 and 2019 are expected to have 51 seats or more - with the biggest category being jets with 76 to 130 seats, according to Forecast International.
"More of those are going to see the skies," said aviation consultant Mike Boyd. But those aluminum-skinned 50-seaters will be scrapped for parts. "They're on their way to the Budweiser display."

By JOSHUA FREED
AP Airlines Writer
Nov 25, 1:50 PM EST
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Re: Airlines cut small jets as fuel prices soar

Post by Key »

Interesting.
A considerable part of the small jets took over turboprop routes in the past decade, very often because passengers don't like the noise - and thus choose the company that employs jets on their route. From the article, it now looks like even these aren't good enough anymore. While it seems that passengers' wishes are met by reverting to bigger jets, the truth is indeed that more routes get eliminated, simply because there is no market for the bigger jets on them. After all, the magic fuel burn calculations only hold for larger jets with filled seats.

So, the line of events for small airports on short hauls is something like: economic but less comfortable service -> less economic but more comfortable service -> no service at all. In other words, the quest for comfort was sabotaged by rising fuel prices and now air travel is leaning towards high density-only. AFAIK, the same thing happened in the sixties of the previous century. 8)
This is a sad story for the turboprop manufacturers, that got pushed out of the market with no apparent way back while they would offer a workable alternative right now. DHC of course is a tough exemption to the rule, having developed a turboprop with near-jet performance and high-tec installations to counter the noise.

Reflecting on this with an example from close to my home, it's sort of ridiculous to fly jets from Amsterdam to Brussels, never reaching anything like an economic cruising level. That is indeed a huge waste of fuel, while there was at least some economics in the route when served by turboprops. (On a side note, this reminds me of when SABENA introduced BAC111s on this route - in 1995... This must have been one of the nails in their coffin.)
As the turboprops have left the fleets for years to come, it is not unlikely routes like this will be dropped in the near future. While that may not be a very big problem for point-to-point travel (AMS-BRU is roughly 2h15 by car, door to door with whatever you wish to carry) it is a bummer for transiting passengers. If your intercontinental trip via AMS starts with a drive like that from BRU - with additional parking fees et cetera! - you start looking for alternatives. No wonder Air France-KLM has such interest in high-speed rail connections.


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Re: Airlines cut small jets as fuel prices soar

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This reminds me of the Lufthansa services from Frankfurt to Dusseldorf, and vice versa. If you wish to fly from let's say Düsseldorf to Thailand, you will "fly" from Düsseldorf to Frankfurt on the ICE train with a LH flightnumber, and board a real plane in Frankfurt. This is more time/fuel-efficient than years ago, when there were still feeder flights between Frankfurt and Düsseldorf.
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Re: Airlines cut small jets as fuel prices soar

Post by aviodromefriend »

Key wrote:No wonder Air France-KLM has such interest in high-speed rail connections.
Interesting to realise: just this week the decision has been taken at ministery-level that AF-KLM's share in HSL-south is to be terminated as a part of a try to save these railwayservices.
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Re: Airlines cut small jets as fuel prices soar

Post by Gietje »

Key wrote: Reflecting on this with an example from close to my home, it's sort of ridiculous to fly jets from Amsterdam to Brussels, never reaching anything like an economic cruising level. That is indeed a huge waste of fuel, while there was at least some economics in the route when served by turboprops.
KLM still operates that sector, with a Fokker 70. I think there are something like 5 daily flights, so they must earn some money on those flights, otherwise they would have reduced the frequencies?
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Re: Airlines cut small jets as fuel prices soar

Post by ehusmann »

Gietje wrote:
Key wrote: Reflecting on this with an example from close to my home, it's sort of ridiculous to fly jets from Amsterdam to Brussels, never reaching anything like an economic cruising level. That is indeed a huge waste of fuel, while there was at least some economics in the route when served by turboprops.
KLM still operates that sector, with a Fokker 70. I think there are something like 5 daily flights, so they must earn some money on those flights, otherwise they would have reduced the frequencies?
The money is in the transit passenger flying something like BRU-AMS-USA/Asia. Most passengers like that will prefer to fly BRU-AMS instead of taking the train because of their onword connection. If the only option would be the train on that segment I bet most will opt for another connection where there is no train segment.
Key wrote:DHC of course is a tough exemption to the rule, having developed a turboprop with near-jet performance and high-tec installations to counter the noise.
Interesting that you mention DHC and not ATR. Where DHC thought they had a good alternative with a fast and quiet DHC.8, it is ATR that now is dominating the market with the ATR.72-600. If my memory serves me correctly ATR has about 100 orders on the year, where DHC only has a handful.

But all these things are waves. It comes and go. The days of the props aren't numbered, neither are the days of the small jets. 50 seat jets maybe, but surely not the 70 and 100 seat jets. If fuel prices drop again, or if different engines (running on different fuels or in a different way) are invented the small jets might come back as fast as they are now being removed from services. If money can be made with it, it will be made with it.

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Re: Airlines cut small jets as fuel prices soar

Post by Key »

ehusmann wrote:Interesting that you mention DHC and not ATR. Where DHC thought they had a good alternative with a fast and quiet DHC.8, it is ATR that now is dominating the market with the ATR.72-600.
Ah, that was my locally-biased view... Thanks for putting it right!

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Re: Airlines cut small jets as fuel prices soar

Post by pjotrtje »

ehusmann wrote:If fuel prices drop again
Fuel prices will not drop to a level we were used to 5 years ago. Why? The oil price is usually high in a time of high economic growth (demand outperforming production) and low in a time of economic downturn. The reason the oil price is high now, has to do with unrest on the market in general. The moment the 'stress' has passed, economic growth will then take the place of the insecurity as the reason why the oil price is high. And since the oil is increasingly difficult to find and the places where it is available are becoming more 'interesting' (remote and/or deep) the cost for oil will increase even without demand increasing or production dropping...
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Re: Airlines cut small jets as fuel prices soar

Post by ehusmann »

Although I agree with all you are saying (except your final conclussion), you do leave out a few factors.
First, when oil prices really will go up, the hunt for alternatives will increase. A lot of work there has already been done and it is only a matter of time before real alternatives are found. Once that is the case, oil prices will go down as especially future oil usage will go down, decreasing speculation. And that is the second point...
Second, part of the oil price high is due to speculation. These days you see it everywhere in raw materials (also in food) that prices are high. This is due to the fact short supply is expected and therefore higher prices in the future. These higher prices may or may not come. If it does not seem to materialise, oil price could go down quicker than it went up.

Now, will prices go down? Yes it will, question is when. I do not know that and therefore saying the market will stay as it is is really a dangerous call....

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