Crowded sky and tighter security spurs private planes
If you wonder who benefits from crowded airways and more intense security that threatens longer airport delays, the answer is obvious: private charter jet companies and rental car agencies.
A recent Zogby International poll found that 42 percent said enhanced pat-down searches and the increased use of full-body scanners by the Transportation Security Administration (TSA) would cause them to use a different mode of transportation.
“Charter jet and rental car trade groups say the switch has already begun,” says Zogby International.
Demand for charter jets was up more than half in November over the same period last year, said Joe Leader, president of the Air Taxi-Air Charter Association, a trade group for charter jet companies.
"The majority of that can be credited to an increase in business travel and economic recovery, but the TSA security hassle factor has absolutely had an additive effect on air taxi and air charter demand," he said.
Meanwhile, the American Car Rental Association reported an increase of up to 11 percent in rental business in November over the same period last year. That’s in part to the growing hassles of air travel, according to the association’s Executive Director Sharon Faulkner.
“During the recession, demand for rentals dropped, particularly among business travelers. In addition, many rental companies had an oversupply of cars bought under special deals offered by manufacturers, pushing rates further down,” said the LA Times.
But that’s changed.
The nation’s largest rental car companies, including Hertz and Avis, reported year-over-year profit growth for the July-to-September period, thanks mostly to growing demand.
That growth is expected to continue. By the end of 2010, the industry is expected to report more than US$20.5 billion in combined revenue, a nearly 3 percent increase over 2009, according to a survey released this month by Auto Rental News, a trade magazine.
"We have seen that business travel is definitely leading the way," said Christy Conrad, a spokeswoman for Enterprise Holdings Inc., the company that operates the Enterprise, Alamo and National car rental brands. "We, as a company, are signing lots of corporate accounts."
The good news for car renters is that rates have remained relatively flat.
With the improved economy, passengers are turning again to the skies for air travel. But airlines have not added capacity to meet the growing demand.
Airlines are packing their cabins as close to capacity as possible. In August, the nation’s airlines flew at 85.3 percent of capacity, the highest percentage for any August ever, according to the US Bureau of Transportation Statistics.
A passenger’s attempt to detonate hidden explosives aboard a Dec. 25 flight also prompted the TSA to toughen security measures at the nation’s airports, but that does not apply to car rentals.
Car Rental Association member Faulkner had an answer why car rentals are up.
"No one is getting patted down at rental agencies," she said.
By David Wilkening
David
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