Thursday
Jun262008
Oil soaring, airlines nosediving
The airline industry’s impact on entrepreneurs and the US economy was discussed by the House Committee on Small Business. Rep. Nydia Velazquez (D-N.Y.) said that the United States is in an air travel crisis and that small business owners across the country will feel the impact of struggling airlines.
Paul Ruden, vice president of legal affairs for the American Society of Travel Agents, said demand for airspace and runways exceeds supply in the United States. Ruden stated that excess demand for seats, congestion in airports, the introduction of fees for services once included in the ticket price, and the increased cost of oil leave consumers alienated. Rep. Steve Chabot (R-Ohio) said airline fuel costs have increased from $16 billion in 2000 to an estimated $61 billion in 2008. Chabot suggested increasing domestic oil production, citing a FOX News survey which says 76 percent of Americans support drilling offshore and in Alaska.
Roger Dew, president and CEO of the Travel Industry Association, said Americans’ frustrations with airline travel predates the soaring price of oil and that oil costs will only amplify frustrations with security lines and an unreliable infrastructure. Terry Segerberg, a small business owner in Cincinnati, Ohio, said airline and other transportation costs are forcing her and other business owners to spend thousands monthly on travel, a reality that causes companies to struggle to remain competitive. Kevin Mitchell of the Business Travel Coalition said Congress can help entrepreneurs by cracking down on oil speculation, strengthening the dollar, pressuring OPEC to increase oil supply, and suspending federal taxes and fees on airlines until March 2009.
Paul Ruden, vice president of legal affairs for the American Society of Travel Agents, said demand for airspace and runways exceeds supply in the United States. Ruden stated that excess demand for seats, congestion in airports, the introduction of fees for services once included in the ticket price, and the increased cost of oil leave consumers alienated. Rep. Steve Chabot (R-Ohio) said airline fuel costs have increased from $16 billion in 2000 to an estimated $61 billion in 2008. Chabot suggested increasing domestic oil production, citing a FOX News survey which says 76 percent of Americans support drilling offshore and in Alaska.
Roger Dew, president and CEO of the Travel Industry Association, said Americans’ frustrations with airline travel predates the soaring price of oil and that oil costs will only amplify frustrations with security lines and an unreliable infrastructure. Terry Segerberg, a small business owner in Cincinnati, Ohio, said airline and other transportation costs are forcing her and other business owners to spend thousands monthly on travel, a reality that causes companies to struggle to remain competitive. Kevin Mitchell of the Business Travel Coalition said Congress can help entrepreneurs by cracking down on oil speculation, strengthening the dollar, pressuring OPEC to increase oil supply, and suspending federal taxes and fees on airlines until March 2009.
TSA needs to do a lot of work to ensure cargo safety
The major challenges faced by the TSA is that there is not enough capacity at all the airports to do all the screening that needs to be done, Sammon said. The lack of capacity makes it impractical to attempt to break down, screen and reassemble large consolidated loads on airport property with any timelines or efficiency and it also poses a security threat, he said.
Cathleen Berrick, director of the Homeland Security and Justice Issues at the U.S. Government Accountability Office, said that TSA faces five major challenges: TSA has noted some technologies that will be allowed but has not finished that assessment, TSA has not finished it’s air cargo vulnerability assessments, TSA may face resource challenges, TSA is working with outbound and domestic air cargo but more work is needed on inbound international flights, and finally TSA needs to set standards that all air cargo companies are willing to work with.