Transitioning The U.S. Air Transportation System To Higher Fuel Costs
The air transportation system enables economic growth and provides significant social benefits. Future increases and volatility in oil prices, as well as climate change policies, are likely to increase the effective cost of fuel. We investigate the expected impacts of higher fuel costs on the U...
| Main Authors: | , , |
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| Format: | Technical Report |
| Published: |
2011
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| Subjects: | |
| Online Access: | http://hdl.handle.net/1721.1/65891 |
| _version_ | 1811077969671618560 |
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| author | Morrison, James Yutko, Brian Hansman, R. John |
| author_facet | Morrison, James Yutko, Brian Hansman, R. John |
| author_sort | Morrison, James |
| collection | MIT |
| description | The air transportation system enables economic
growth and provides significant social benefits.
Future increases and volatility in oil prices, as well
as climate change policies, are likely to increase the
effective cost of fuel. We investigate the expected
impacts of higher fuel costs on the U.S. domestic air
transportation system and discuss policy options to
reduce negative economic and social effects. The
2004-08 fuel price surge is used as a historical case
study. A stochastic simulation model is developed
using price elasticity of demand assumptions and
flight leg fuel burn estimates to understand the
impacts of higher fuel costs. It was found that a
50% increase in fuel prices is expected to result in a
12% reduction in ASMs if all cost increases pass
through to passengers. System revenues are
expected to decrease marginally for fuel price
increases up to 50%, but higher increases may
result in significant revenue reductions. Small
airports are expected to experience relatively larger
decreases and greater volatility in traffic. Older
aircraft, flying sectors significantly below their
optimal fuel efficiency range, are expected to
experience the greatest reductions in capacity. An
airline case study demonstrates that a regional
carrier may be less sensitive to increased fuel prices
than other business models. Policy options to
maintain small community access, to manage
airport traffic volatility, and to improve fleet fuel
efficiency are discussed. To transition the U.S. air
transportation system to higher fuel costs,
stakeholder action will be required. |
| first_indexed | 2024-09-23T10:51:19Z |
| format | Technical Report |
| id | mit-1721.1/65891 |
| institution | Massachusetts Institute of Technology |
| last_indexed | 2024-09-23T10:51:19Z |
| publishDate | 2011 |
| record_format | dspace |
| spelling | mit-1721.1/658912019-04-12T20:57:16Z Transitioning The U.S. Air Transportation System To Higher Fuel Costs Morrison, James Yutko, Brian Hansman, R. John air transportation oil prices climate change fuel costs The air transportation system enables economic growth and provides significant social benefits. Future increases and volatility in oil prices, as well as climate change policies, are likely to increase the effective cost of fuel. We investigate the expected impacts of higher fuel costs on the U.S. domestic air transportation system and discuss policy options to reduce negative economic and social effects. The 2004-08 fuel price surge is used as a historical case study. A stochastic simulation model is developed using price elasticity of demand assumptions and flight leg fuel burn estimates to understand the impacts of higher fuel costs. It was found that a 50% increase in fuel prices is expected to result in a 12% reduction in ASMs if all cost increases pass through to passengers. System revenues are expected to decrease marginally for fuel price increases up to 50%, but higher increases may result in significant revenue reductions. Small airports are expected to experience relatively larger decreases and greater volatility in traffic. Older aircraft, flying sectors significantly below their optimal fuel efficiency range, are expected to experience the greatest reductions in capacity. An airline case study demonstrates that a regional carrier may be less sensitive to increased fuel prices than other business models. Policy options to maintain small community access, to manage airport traffic volatility, and to improve fleet fuel efficiency are discussed. To transition the U.S. air transportation system to higher fuel costs, stakeholder action will be required. MIT Partnership for AiR Transportation Noise & Emissions Reduction (PARTNER) provided access to the Piano-X aircraft performance database. The Transportation Research Board’s (TRB) Airport Cooperative Research Program (ACRP) supported this work through the Graduate Research Award Program on Public-Sector Aviation Issues. 2011-09-20T14:45:54Z 2011-09-20T14:45:54Z 2011-09-20 Technical Report http://hdl.handle.net/1721.1/65891 IcAT;2011-8 An error occurred on the license name. An error occurred getting the license - uri. application/pdf |
| spellingShingle | air transportation oil prices climate change fuel costs Morrison, James Yutko, Brian Hansman, R. John Transitioning The U.S. Air Transportation System To Higher Fuel Costs |
| title | Transitioning The U.S. Air Transportation System To Higher Fuel Costs |
| title_full | Transitioning The U.S. Air Transportation System To Higher Fuel Costs |
| title_fullStr | Transitioning The U.S. Air Transportation System To Higher Fuel Costs |
| title_full_unstemmed | Transitioning The U.S. Air Transportation System To Higher Fuel Costs |
| title_short | Transitioning The U.S. Air Transportation System To Higher Fuel Costs |
| title_sort | transitioning the u s air transportation system to higher fuel costs |
| topic | air transportation oil prices climate change fuel costs |
| url | http://hdl.handle.net/1721.1/65891 |
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