Although some technological gains in aircraft manufacturing are expected over the next two decades, the dramatic advances of the past which have led to lower air fares are probably over, American and British aerospace officials suggested yesterday.
This assesment was made by Air Chief Marshall Sir Peter Fletcher, director of corporate strategy and planning for British Aerospace, and by John E.Steiner, vice president of the Boeing Co., at an international aviation conference sponsored by Lloyd's of London Press.
Fletcher noted that fares have steadily declined in real terms up to now because airlines experienced lower costs in operating successive types of planes.
For instance, on top of the advant of the jet engine, increasing the number of seats in a plane allowed for more efficient use of cabin space, and increased air speeds produced greater productivity. Also increased aircraft utilization, longer aircraft lives, lower maintenance costs and, up to a few years ago, the declining cost of fuel in real terms were all factors, he said.
Now, however, some of these trends are reaching a plateau and make the future more uncertain, Fletcher noted. "The past downward trend in fares will be difficult to sustain in the future," he said.
Dramatically rising fuel costs are the most visible factor affecting airline costs but noise-reduction efforts, congestion in the air and at the airports, and inflation are all important. For instance, airlines have been reducing cruise speeds over the last year to save fuel but that, coupled with delays arising from congestion, further reduces aircraft productivity.
Boeing's Steiner agreed that technology is "somewhat at a plateau" but was optimistic that the industry would "find solutions." Unfortunately, development of new airplanes with advanced technology was delayed by the poor financial condition of the U.S. airlines over the last decade, he noted "If you have a sick customer, you have a sick industry," Steiner said of the aircraft makers.
The U.S. airlines historically have absorbed about half the Free World's commercial airplanes, and most of the new plane "starts" have been initiated to meet their requirements. Because of increased airline earnings in the last two years, Boeing and the other aircraft makers have gotten orders and have proceeded with plans to develop new planes.
The rapidly growing air-travel marker, partially the result of deregulation, has produced a great number of new orders for existing planes as well. Steiner noted that Boeing is now producing 28 planes a month, up from 10 a month in 1976