The New Math Lives!
Cheap Transportation At $375 an hour
If the economics don't work, make it look like they do.
A $1 million plus Small Community Air Service Grant is about to get applied to a space-cadet program to provide intra-Dakota Region air taxi service, using three-passenger (plus pilot, we assume) aircraft equipped with a parachute - for the airplane, not the individual passengers.
The PR for this concept is impressive:
"...New technology innovations in the aerospace sector are facilitating the emergence of low-cost, point-to-point air services capable of serving both commercial centers and small communities alike throughout the United States and Canada.
...(the) mission is to position North Dakota and other participating Great Plains states on the cutting edge of this rapidly emerging public air travel revolution in order to create new jobs, spur new economic growth and development and enhance quality of life..."
In summary, the grand plan, called Point2Point, is touted as a low-cost solution to getting all those people who want to fly between rural points onto airplanes. At a price of just $375 per hour. And, wonders never cease: If you pre-pay $17,000, you can get it for just $350!
Let's do the math for this low-cost revolution.
Let's say for the that lawyer, doctor, or accountant needing to get from, say, Sioux City, Iowa, to Rapid City...
It's 354 miles.
The Cirrus aircraft used in this breakthrough airline system cruises, supposedly, at 200 mph.
Factor in a bit of taxi time, climb and descent, and we're looking at block time of, say, 2.0 hours.
Then about the same coming back, for a total of 4.0 hours.
That's a bargain-basement fare of just $1,500.
That ought to really enhance "quality of life" in the Dakotas. And, presumably, although it's not clear, if the passenger can find two other lawyers, doctors, or other discount-fare worshippers, both of whom want to go and come back at exactly the same time, the cost could be slashed to just $500 each. Even more if they want to cough up 17 Large in advance. Quite the travel budget.
Yessir, people are going to be lined up for this service. Including the Tooth Fairy and Elvis, no doubt.
Good Intentions. Really Questionable Assumptions. The hard fact - one that lots of entities and civic groups often refuse to accept - is that rural, point-to-point air service, whether it's scheduled, chartered, or hi-jacked by an angry Holstein, is very expensive. The basic economics of air transportation simply do not lend themselves to "low-cost, point-to-point" service in rural areas. Especially with 3-passenger airplanes.
The intentions are laudable, but this operation is in need of an industrial-strength dose of reality. Either now, or when the money runs out.
In the early 1990s, South Dakota got swan-songed by somebody into establishing a state-supported intra-regional airline. The "Wings of South Dakota" (no jive - that's what they really called it) got sold as a solution to the pressing need to meet all that demand that existed for air service within the state. Despite being operated by a reputable airline operator, the entire year's subsidy budget went 86 in about 90 days.
South Dakota found that , history and economic realities notwithstanding, there're always folks out there who'll tell people what they want to hear, how they want to hear it. And there's more than enough victims that are only too happy to hear it.
Low fares at just $375 an hour. Herb Kelleher take note, please - the entire Southwest model is at risk here.
(c) 2006, The Boyd Group/ASRC, Inc. All Rights Reserved
