The airline industry, which has traditionally been run in cycles of boom-bust cycles, have a good chance to become profi over the next 20 years as demand for air travel is growing around the world. And good news for passengers: airfares will rise relatively slow during that time.
That prediction comes from the Federal Aviation Administration report released Thursday state of u.s. airline industry, FAA Aerospace forecasts the fiscal year 2012-2032.
“In the long term, we see a competitive and profi industry is characterized by increasing demand for air travel and airfares are growing slower than inflation,” the report said. “Going into the next decade, there was optimism cautiously that the industry has changed from that of the boom-to-bust cycles to one of sustainable profits.”
The report predicted more demand for air travel despite the rise in oil prices and the current climate of economic uncertainty in the u.s. and Europe. It forecasts that the industry will grow from 731 million passengers in the year 2011 to 1.2 billion in 2032. Air traffic growth for the United States carriers expected to rise by more than 90 percent during that time. It grew 3.5 percent in 2011. “This year, more people will fly miles further, and we hope that continues in future years,” FAA Acting Administrator Michael Huerta said in a statement.
Overall, however, the estimated more Cape on short-term prospects. For example, forecasts that annual global air traffic will reach 1 billion passengers in 2024, three years later than projected last year. “Growth over the next five years will be moderate, with a return to the historic growth rates achieved only in the long term,” the report said.
