The US airline industry faces five major challenges, according to the Air Transport Association (ATA), which delivered that message to the Department of Transportation yesterday. Its greatest challenge, according to the ATA, rests on how government addresses various issues including fuel volatility and taxation and the fact that it sees airlines and their passengers as 'ATM machines'.
“The industry's ability to meet these challenges while remaining globally competitive will depend on how government addresses issues,” said the ATA. The issues include wildly fluctuating oil prices, which make business planning impossible; excessive regulatory burdens that take away from carriers' ability to invest in equipment and services; and a prevailing view that airlines and their customers are always "ripe" for more taxation. Enlightened regulation could lead to increased capital availability, rather than a diminished drain on resources necessary to fund government mandates.
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NextGen and climate change pressing near team issues
Speaking on the future of US aviation, one of the largest challenges, noted the ATA, is getting to NextGen. Couple that with issues surrounding climate change, especially the costs associated with cap and trade schemes, "and you have the near-term issues facing the industry".
NextGen, said ATA, would mitigate many industry problems, improve air service, reduce emissions and provide for economic growth. “The efficiencies NextGen promises complement ATA's commitment to continued, significant progress in fuel and greenhouse gas efficiency,” said the association. “ATA supports a global sectoral framework for addressing climate change, managed though ICAO, including aggressive emissions-reduction targets and sustainable alternative fuels.”
“Collectively, these five challenges will define the 21st century airline industry,” said the industry body. “Because commercial aviation helps drive USD1.1 trillion in US economic activity annually, plus more than 10 million US jobs, our ability to meet these challenges is absolutely critical.”