Short-term, Boeing benefits from airlines' desperate need for more fuel-efficient planes. That's one reason the order book is fat and the International Association of Machinists thinks this is a good time to strike. (And it's why the strike, in the words of Mike Parks of Marple's Pacific Northwest Letter, "could be a very long one.") Looking at this demand, both Boeing and the state economic forecasters see continued, booming growth for the airplane manufacturer, at least through 2011. But there are two big problems.
Those problems are climate change and very high jet-fuel prices. To take oil prices first, many analysts think that a lot of airlines simply can't survive at $135-a-barrel oil, since many of them barely functioned at low fuel costs. Two Canadian transportation experts predict in a new book, Transportation Revolutions, that rising oil prices will reduce domestic flying in the U.S. by 40 percent by 2025. Surveying these studies in a scary article in The New Republic, Bradford Plumer notes:
In such a scenario, the United States could go from having nearly 400 primary airports down to 50 or so; instead of dozens of flights each day between New York and San Francisco carrying 200 people apiece, there might be only a handful carrying 800 or more in new extra-jumbo jets.
Already, U.S. airlines are scaling back flights sharply. Big carriers such as American and United have announced cuts in the 12 percent to 16 percent range, while many regional jets are being grounded en masse. Alaska Airlines just announced it will be cutting more flights and laying off 1,000 workers. Many airports are expected to lose 10 percent of their service in the coming year.
This is not just the current combination of high fuel costs and a recession; it's long term. One reason is that there may not be that much more fuel efficiency to be gained. The 787, according to Boeing, will use 20 percent less fuel, but that's a relatively small reduction compared to the 70 percent gains in efficiency over the past four decades. Nor will it be easy to decarbonize the fleets by shifting away from kerosene-based fuels to such unlikely models as solar power or hydrogen fuel cells. Biofuel is working on a few Virgin Airlines flights, but that raised questions about land use and displacement of food crops.
Which brings us to the other big problem for the industry: climate change. Already in Europe and Britain, green groups are waving "We fly, we die" placards, fighting a third runway at Heathrow and making the case that flying as much as we do in the age of cheap air fares is a luxury we cannot continue to afford. Aviation accounts for just 3 percent of man-made carbon dioxide emissions, but the emissions are high in the atmosphere, which compounds the problem, and planes also produce nitrous dioxide from contrails. The cure: stiff taxes such as the 15 percent rate on carbon use proposed by the European Union starting in four years. Paying the full environmental costs of flights could boost fares five-fold, according to one expert.
Plumer's article traces the enormous economic changes wrought by the age of mass aviation, which began with Boeing jets and Reagan's deregulation of the industry and was brought about by pressure from businesses and consumer groups. Just think of the consequences of this revolution in aviation: Low-wage immigrants are more willing to move far from home, knowing that cheap air fares enable more visits. "Aerotropolises" have grown up around airports, lined with pharmaceutical and technology companies that need fast air freight. Air freight has dramatically increased the number of items in your fancy supermarket or the items sold by Amazon. Small towns and whole states like Alaska have become dependent on regional airlines for tourism and footloose businesses. The end of cheap aviation would be a huge deal, for Boeing as well as the entire American economy.
What can be done? There are some refinements such as blended-wing designs to reduce drag, using more propeller planes (they use less fuel than jets), and improving air-traffic control to cut down flight times and delays. But these won't accomplish much, particularly if the urgency for climate issues truly spreads to American skies. Bigger fixes would be high-speed trains (such as California is proposing, from Bay Area to Los Angeles in under three hours), morphing airports into travelports that link rail and air systems, closing hundreds of small airports, and shifting flights to jumbo jets. We may even go back to the age of flying in the 1950s, when "jet set" meant high-cost, relatively rare, special-occasion flights on luxury planes.