Forecasts of Aviation Demand by gdc15591

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									                                                                                                Chapter   2
                                                             Forecasts of Aviation Demand

Introduction

Billings Logan International Airport is a bustling hub with an expansive
geographic service area. A steady flow of people and goods travels
through the facility each day. In order to accommodate this continuous
activity, the correct balance of services and infrastructure must be in
operation at all times. In order to form a valid basis for programming of
future capital improvements, forecasts of aviation activity are
necessary. These projections estimate potential future activity levels
through evaluation of historic data and the application of projection
models. The validity of these predictions is critical as changes in
aviation demand also affect airport capital improvement programming,
funding and budgeting, as well as on-site facilities, services, and staff.

Forecasts of aviation activity serve as a guideline for the timing required for implementation of airport
improvement programs. While such information is essential to successful comprehensive airport planning,
it is very important to recognize that forecasts are only approximations of future activity, based upon
historical data and from the standpoint of present situations. They therefore must be used with careful
consideration, as they may lose their validity through the passage of time. For this reason, an ongoing
program of examination of local airport needs, as well as national and regional trends, is recommended
and encouraged in order to promote the orderly development of the Airport.

Following the development of the estimated current demand, projections are made based upon
established growth rates, area demographics, industry trends and/or other important indicators.

This chapter describes historic data and Terminal Area Forecasts (TAF) data to report on the following
elements:


•   Passenger enplanements
•   Aircraft operations
•   Based aircraft
•   Air cargo
•   Peak aviation demand characteristics
•   Projection summary

Forecasts that are presented in this chapter examine historic aviation data from 1997 through 2006. This
ten year study period provides data that is current enough to identify trends. This is important because
growth in the aviation industry is based on demand. Projections are recorded for short-(5 year), medium-
(10 year), and long-range (20 year) periods starting from the base year (2006).


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CHAPTER 2                                                                FORECASTS OF AVIATION DEMAND


2.1      Passenger Enplanements

Enplanements are defined as the activity of passengers boarding commercial service aircraft that depart
the Airport. Enplanements include passengers on scheduled commercial service aircraft or non-
scheduled charter aircraft. Enplanements do not include the airline crew.

Passenger enplanement data is provided to Airport management by commercial passenger service
carriers, who maintain data as they transport people to and from the facility. Though the FAA has
estimated figures on file called Terminal Area Forecasts (TAF), airport records are generally a more
accurate source.

Though recorded, deplanements are not evaluated in this document. Because Billings is primarily an
origination and destination market, it is assumed that a passenger flying from Billings is likely to return so
enplanements roughly equal the approximate number of deplanements.

This section examines data that pertains to passenger enplanements and describes enplanement
projections. The following subsections are addressed:


•     Enplanement history and industry trends
•     FAA TAF enplanement data and projections
•     Applicable projection methodologies including market share and socioeconomic variable
•     Method comparison and preferred projection methodology

2.1.1    Enplanement History and Industry Trends

In order to analyze the significance of the results presented in this chapter, this section provides a
summary of trends in aviation that may impact both passenger enplanements and operations.

2.1.2    National Trends

The aviation industry has been volatile in recent years. An increase in fuel price, heightened airport
security, emergence of low cost air service providers, and variance of consumer demand has contributed
to uncertainty in the industry. A combination of these and other factors has caused airline strikes,
bankruptcies, and even inefficiencies in some markets.

The airline industry is also resilient. Despite hurdles to be profitable, many airlines are starting to show
signs of recovery amid recent turmoil. Declining labor costs, shrinking domestic seat capacity, and
increasing travel demand has resulted in better profits for airlines, and additional seat tax revenue for the
industry.




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CHAPTER 2                                                                    FORECASTS OF AVIATION DEMAND


2.1.3      Local Trends

Historic figures recorded at the Airport mirror national trends in aviation. Enplanements have steadily
increased at Billings since 1997, and in 2005, a ten year high point of 418,141 enplanements was
realized. Despite this increase, there was a drop in enplanements in 2005 and 2006. This is primarily due
to service reductions by airlines at the Airport. In December of 2005, Delta Airlines cut back the number of
flights to Salt Lake City. These changes were determined to be partially bankruptcy driven, and involved
customary bankruptcy tactics. America West Airlines (now merged with US Airways) eliminated service to
Billings; it was announced and presumed to be because of a lack of profitability due to market competition
and fuel prices 1 . There have been recent attempts by the airlines to resolve these issues by identifying
additional routes that could be profitable and by targeting fleet modifications.

The drop in activity in 2006 notwithstanding, on the average, enplanements at the Airport increased
steadily throughout the study period as shown in Table 2-1. In 1997 there were 317,521 enplaned
passengers at the Airport; in 2006, there were 415,298, a compounded annual growth rate (CAGR) of
3.03 percent. The CAGR is a measurement of how much something grew on average, per year, over a
multiple-year period, after considering the effects of compounding. Although no historical data is a
substitute for a forecast, the CAGR over a number of years (typically the last five) is a better indication of
a trend than a single year's growth which may be atypically good or bad.


    Table 2-1. Historic Passenger Enplanements
    Year                   Enplanements       FAA
    Historic
    1997                   317,521            302,156
    1998                   328,123            308,068
    1999                   351,233            332,183
    2000                   358,778            337,518
    2001                   354,722            348,209
    2002                   382,691            359,024
    2003                   371,164            362,106
    2004                   411,989            382,444
    2005                   418,141            401,997
    2006                   415,298            394,942
    CAGR 1997-2006         3.03%              3.02%
    Source: Airport Administration Records



The Federal Aviation Administration (FAA) monitors and projects activity levels for airports; this data is
available through Terminal Area Forecasts as shown in Table 2-2. According to the FAA’s analysis,
between 1997 and 2006 the CAGR was 3.02 percent. The FAA predicts this figure to increase and that
enplanements will more than double by 2026 increasing to 795,145.
1
 “Evaluation of Air Service Reductions at Billings Logan International Airport.” Report Prepared by Mead & Hunt.
November 2005.
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CHAPTER 2                                                              FORECASTS OF AVIATION DEMAND


 Table 2-2. Enplanement Forecast – FAA
 Terminal Area Forecast TAF
 Year                    Enplanements
 Historic
 1997                    302,156
 1998                    308,068
 1999                    332,183
 2000                    337,518
 2001                    348,209
 2002                    359,024
 2003                    362,106
 2004                    382,444
 2005                    401,997
 2006                    394,942
 Projection
 2011                    457,563
 2016                    536,239
 2026                    795,145
 CAGR 1997-2006          3.02%
 CAGR 2006-2026          3.56%
 Source: FAA Terminal Area Forecast, August 2007



In order to arrive at a reasonable conclusion regarding the level of passenger activity that may occur in
the future, several alternate forecasts were prepared. This method provides a range of confidence in the
results that will not be evident with the use of a single forecast technique. For the purpose of this study,
four alternate enplanement forecasts were prepared. These are described in the following sections.

2.1.4    Alternative Enplanement Forecast – Market Share Methodology

Market share forecasting examines historic enplanement data from the Airport and determines its overall
percentage of national enplanements as shown in Table 2-3. Though it only makes up a small
percentage of overall enplanements, the Airport’s market share has increased since 1997. Between 2002
and 2006, there was an average annual increase in the Airport’s market share of 0.36 percent, which is
held constant through the projection period. Therefore, the average annual increase was used as a
constant variable to project market share percentages for 2011, 2016, and 2026. These percentages
were then applied to corresponding national TAF enplanement projections. This assumption reflects
trends of steady local population and economic growth, and a continued effort by air service providers to
increase passenger enplanements. Market share projects 801,692 passenger enplanements in 2026, a
20 year CAGR of 3.34 percent.




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CHAPTER 2                                                          FORECASTS OF AVIATION DEMAND




 Table 2-3: Enplanement Forecast – Market Share Methodology
                            US                     BIL
 Year                       Enplanements           Enplanements   Market Share
 Historic
   1997                     577,845,747            317,521        0.0549%
   1998                     590,417,191            328,123        0.0556%
   1999                     610,924,928            351,233        0.0575%
   2000                     561,493,888            358,778        0.0639%
   2001                     546,310,418            354,722        0.0649%
   2002                     485,921,321            382,691        0.0788%
   2003                     482,838,537            371,164        0.0769%
   2004                     502,567,046            411,989        0.0820%
   2005                     523,143,810            418,141        0.0799%
   2006                     517,912,372            415,298        0.0802%
 Projection
   2011                     593,552,406            484,659        0.0817%
   2016                     685,527,557            570,230        0.0832%
   2026                     929,560,000            801,692        0.0862%
 CAGR 1997-2006             -1.21%                 3.03%
 CAGR 2006-2026             2.97%                  3.34%
 Sources: FAA, Mead & Hunt



2.1.5    Alternative Enplanement Forecast - Population Variable Methodology

Using socioeconomic data to forecast aviation demand can be useful to identify regional economic or
commercial shifts that impact enplanements and airport service requirements. Population, income, and
employment are all measurable variables that may be beneficial in the development of projections.
Population figures for the Billings MSA were obtained from Woods & Poole, Inc. The U.S. Office of
Management and Budgeting identifies MSA’s as an area that contains a core urban area of 50,000 or
more residents and one or more counties and including that in the core urban area, as well as any
adjacent counties that have a high degree of social and economic integration (as measured by
commuting to work) with the urban core. The Billings MSA incorporates Yellowstone and Carbon
Counties and is assumed to be an accurate source to identify trends based on available data.

The population variable methodology examines historic data to profile enplanements per person, which
provides insight into whether or not air travel has been consistent with population change.

Annual per capita enplanements have fluctuated between 2.32 and 2.85 since 1997. The population of
Billings has grown slower (0.9 percent annually) than the number of enplanements (3.03 percent). In
general, this means that people are flying more frequently in 2006 than in 1997.


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CHAPTER 2                                                                      FORECASTS OF AVIATION DEMAND


Between 1997 and 2006, per capita enplanements increased an average of 2.11 percent each year. This
2.11 percent annual increase is applied to 5-, 10-, and 20-year cohorts from base year 2006 figure of 2.80
enplanements per person, which results in enplanements per capita projections of 3.11 in 2011, 3.45 in
2016, and 4.26 in 2026. These figures are multiplied by population projections for corresponding years to
determine future enplanement figures; 488,327 in 2011, 572,572 in 2016, and 784,622 in 2026 (see
Table 2-4). The projected CAGR for enplanements between 2006 and 2026 is 3.23 percent. An increase
in population as well as annual passenger travel rates in Billings produces an exponential increase in
future enplanements.


Table 2-4. Enplanement Forecast – Socioeconomic Population Variable
Year                         Enplanements          Population         Per Capita
Historic
   1997                      317,521               136,620            2.32
   1998                      328,123               137,000            2.40
   1999                      351,233               138,230            2.54
   2000                      358,778               139,130            2.58
   2001                      354,722               140,240            2.53
   2002                      382,691               141,600            2.70
   2003                      371,164               142,900            2.60
   2004                      411,989               144,510            2.85
   2005                      418,141               146,480            2.85
   2006                      415,298               148,120            2.80
Projected
  2011                       488,327               156,900            3.11
  2016                       572,572               165,730            3.45
  2026                       784,622               184,310            4.26
CAGR 1997-2006               3.03%                 0.90%              2.11%
CAGR 2006-2026               3.23%                 1.10%              2.11%
Sources: Woods & Poole, Airport Administration Records


2.1.6     Alternative Enplanement Forecasts – Method Comparison and Preference

Though the projections developed in this document are estimates, it is reasonable to assume that the
results portray an accurate picture of a level of demand that may occur at the Airport within the time frame
of this study. Of the applied projection methodologies, (population variable, income variable, and market
share), two showed the most reasonable outcomes. In this case, reasonable means within an acceptable
level of FAA projections, and in sync with local and national socioeconomic and aviation trends. The two
most reasonable methodologies are population variable and market share as shown in Table 2-5.




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CHAPTER 2                                                              FORECASTS OF AVIATION DEMAND




Table 2-5. Enplanement Forecast Comparison
                              FAA TAF         Population    Market Share
Year
                              Projection      Projection    Projection
Projected
2006                          394,024         415,298       415,298
2011                          457,563         488,327       484,659
2016                          536,239         572,572       570,230
2026                          795,145         784,622       801,692
CAGR 1997-2006                3.02%           3.03%         3.03%
CAGR 2006-2026                3.56%           3.23%         3.34%
Sources: Woods & Poole, Mead & Hunt, FAA



Population Variable Projection
The population variable projection compares well with the FAA’s TAF figures, specifically in its 20 year
projection; 784,622 enplanements to the FAA’s 795,145. One issue with this methodology however, is the
difference in the number of enplanements in base year 2006 (see Table 2-6). The FAA reported 20,000
fewer enplanements in 2006 than the Airport. Another issue with the population variable methodology is
that although it accounts for both increases in population and annual rates of travel, it cannot account for
national aviation and air service trends.

Market Share Projection
Like the population variable projection, market share methodology also uses the Airport’s base year figure
to estimate enplanements. However, because the market share methodology compares enplanements at
the Airport with national data produced by the FAA, industry trends and potential air service changes are
accounted for. Though service changes may occur locally, the FAA figures are a good indication of
expected growth. This method reveals a slightly more aggressive estimate of long-term enplanements;
801,692 by 2026 (see Chart 2-1). Because it incorporates already established national enplanement
figures, market share is the preferred projection methodology for the Airport.




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Final Report – October 2009
CHAPTER 2                                                                    FORECASTS OF AVIATION DEMAND



Table 2-6. Enplanement Forecast - Comparison
                                                                    Socio-
                                                   Socio-                                      Market Share/
                                    FAA                             economic/        Market
Year                  Historic                     economic                                    TAF
                                    TAF                             TAF              Share
                                                   (Population)                                (% Difference)
                                                                    (% Difference)
Historic
1997                  317,521
1998                  328,123
1999                  351,233
2000                  358,778
2001                  354,722
2002                  382,691
2003                  371,164
2004                  411,989
2005                  418,141
2006                  415,298
Projection
2011 (base year + 5)                457,563        488,327          6.7%             484,659   5.9%
2016 (base year + 10)               536,239        572,572          6.8%             570,230   6.4%
2026 (base year + 20)               795,145        784,622          -1.3%            801,692   0.8%
CAGR 1997-2006        3.03%
CAGR 2006-2026                      3.56%          3.23%                             2.97%
Sources: FAA, Mead & Hunt, Woods & Poole




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Final Report – October 2009
CHAPTER 2                                                                     FORECASTS OF AVIATION DEMAND



                  Chart 2-1. Enplanement Projections by Methodology (2006 - 2026)

                    Historic                                      Forecast
    900,000




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    500,000




    400,000




                                                                                                                                 Source: FAA, Mead & Hunt
    300,000
          1996                 2001        2006           2011               2016                                                2021                                                 2026




2.2           Aircraft Operations

An aircraft operation is the movement of any aircraft in the vicinity of an airport, including departing and
arriving aircraft. As mentioned in Chapter 1, an operation can be categorized as local or itinerant. Local
operations are performed in local traffic patterns within site of an airport, or in local practice areas within
20 miles of an airport. Itinerant operations, which include commercial flights, are non-local.

This study will emphasize Total Operations as the most meaningful measure of demand that is placed on
the Airport’s infrastructure. The reasoning behind this is that the demand placed upon the Airport’s
runways and taxiways is not dependent upon the destination, purpose, or where the aircraft comes from,
only that the facilities are used by arriving or departing aircraft.

This section examines data that pertains to aircraft operations and describes operation projections. The
following subsections are addressed:

•     Trends in aircraft operations
•     Operation history at Billings Logan International Airport
•     Historic FAA TAF operation figures and projections
•     Alternative projection methodologies for general aviation and commercial operations
•     Method comparison and preferred projection methodology

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Final Report – October 2009
CHAPTER 2                                                                FORECASTS OF AVIATION DEMAND



2.2.1    Trends

The general aviation (GA) sector looks to make a recovery from a recent downturn. Aircraft sales have
been down, but the emergence of turbine (jet) aircraft for business and corporate travel is one example of
how the industry is changing.

The FAA Aerospace Forecast Fiscal Years 2006-2017 predicts the active general aviation fleet will
increase at an average annual rate of 1.4 percent. The more expensive and sophisticated turbine-
powered fleet is projected to grow at an average of 4.0 percent a year for the forecast period with the
turbine fleet doubling in size by 2017. The number of piston-powered aircraft is projected to increase at
an average of 1.0 percent annually. Single-engine and multi-engine piston aircraft sales will grow slower
at 0.3 percent and 0.1 percent respectively. This is offset by a projected 6.7 percent average annual
growth in piston rotorcraft. In addition, the FAA expects that relatively inexpensive very light jets (VLJ’s),
which became available for purchase in early 2007, could dilute or weaken the replacement market for
large piston aircraft.

Despite a decline in total GA operations over the course of the study period, 53,068 operations occurred
in 2006, a significant increase from a ten year low of 48,762 operations in 2004. Historically, local
operations account for 22 percent of total operations at the Airport.

2.2.2    Aircraft Operations History

There were 97,227 total operations recorded in 1997, which increased to 102,878 by 2006 (see Table 2-
7). Commercial operations, which comprised 46 percent of all operations at the Airport between 1997 and
2006, increased from 41,830 to 49,299 during that same time. General aviation (GA) operations, which
counted for over 53 percent of all operations decreased from 55,278 in 1997 to 53,068 in 2006. Military
operations, which have averaged less than one percent of total operations, have fluctuated between 119
and 626 operations during the study period.




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CHAPTER 2                                                                  FORECASTS OF AVIATION DEMAND



 Table 2-7. Historic Aircraft Operations

 Year         Commercial         GA          Military       Total
 Historic
   1997       41,830             55,278      119            97,227
    1998      44,016             58,374      322            102,712
    1999      48,886             66,617      204            115,707
    2000      51,299             65,136      626            117,061
    2001      50,280             66,318      549            117,147
    2002      51,314             50,629      502            102,445
    2003      51,249             49,670      496            101,415
    2004      50,229             48,762      447            99,438
    2005      51,527             52,000      354            103,881
    2006      49,277             53,068      493            102,878
 CAGR         1.84%              -0.45%      17.11%         0.63%
 Sources: Airport Tower Records, Mead & Hunt




 Table 2-8. Aircraft Operations Forecast – FAA Terminal Area Forecast
 Year                          Commercial          GA         Military   Total
 Historic
   1997                       42,224               55,645     535        98,404
   1998                       43,171               57,431     669        101,271
   1999                       47,544               64,359     857        112,760
   2000                       50,754               65,195     1,169      117,118
   2001                       50,979               67,027     778        118,802
   2002                       50,569               54,962     773        106,304
   2003                       52,400               49,013     901        102,314
   2004                       50,033               48,700     758        99,491
   2005                       51,302               51,916     440        103,658
   2006                       50,092               52,585     782        103,459
 Projection
   2011                       54,100               59,612     782        114,494
   2016                       58,532               66,451     782        125,765
   2026                       68,841               79,094     782        154,781
 CAGR 1997-2006               1.92%                -0.63%     4.31 %     .56%
 CAGR 2006-2026               1.60%                1.42%      0.00%      2.03%
 Source: FAA Form 5010 Data, Airport Tower Records




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CHAPTER 2                                                              FORECASTS OF AVIATION DEMAND


2.2.3    Aircraft Operations Forecast – FAA Terminal Area Forecast

The FAA monitors and projects aircraft operations at airports (see Table 2-8). These figures are made
available in the Terminal Area Forecast reports. It is important to note that because of fluctuations in
military operations, the FAA holds the figure from the base year 2006 constant (782).

The TAF projects operations at the Airport to increase, from 103,459 in 2006, to 114,494 in 2011,
125,765 in 2016, and 154,781 in 2026; a 2.03 percent CAGR over 20 years. Commercial operations are
also expected to increase from 50,092 in 2006 to 54,100 in 2011, 58,532 in 2016, and 68,841 in 2026, a
1.60 percent CAGR.

In order to arrive at a reasonable conclusion regarding the level of airport activity that may occur in the
future, several alternate forecasts of aircraft operations were prepared. As with the enplanement
forecasts presented above, this method provides a range of confidence in the results that will not be
evident with the use of a single forecast technique. For the purpose of this study, two alternate forecasts
were prepared for General Aviation operations, as well as separate analysis of commercial operations.
These are described in the following sections.

2.2.4    General Aviation Operations Forecast – Alternative Methodology: Operations per Based
         Aircraft

The operations per based aircraft methodology compares historic figures of based aircraft at the Airport to
the number of GA operations at the Airport. Between 1997 and 2006, the average number of annual
operations per based aircraft was 342. This number is held constant throughout the projection period and
multiplied by the projected number of based aircraft at the Airport. Figures for based aircraft are derived
from a population variable methodology that assumes approximately one aircraft for every 1,000
residents in the Billings MSA. This may seem conservative but this is due to significant fluctuation in the
number of aircraft at the Airport from 1998 to 2006. Methodologies for based aircraft forecasts are
described in Section 2.3.

In July 2007, the Rocky Mountain College Aviation Program moved from nearby Laurel Airport to Billings
Logan International Airport. This relocation affects the number of based aircraft and general aviation
operations at the Airport. According to school officials, there were approximately 10,000 operations
conducted by students in 2006. School officials anticipate a 25 percent increase in operations by the year
2026. This translates into 10,625 operations in 2011, 11,250 in 2016, and 12,500 in 2026. There were
eight aircraft in the School’s fleet in November 2007 with no immediate plans to purchase additional
planes. These figures are factored in the final operations per based aircraft methodology in Table 2-9.




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Final Report – October 2009
CHAPTER 2                                                                  FORECASTS OF AVIATION DEMAND



  Table 2-9. GA Operations Forecast – Operations per Based Aircraft
                                                                  Operations per
  Year                       Based Aircraft        Operations
                                                                  Based Aircraft
  Historic
  1997                       183                   55,278       302
  1998                       183                   58,374       319
  1999                       206                   66,617       323
  2000                       217                   65,136       300
  2001                       145                   66,318       457
  2002                       145                   50,629       349
  2003                       136                   49,670       365
  2004                       151                   48,762       323
  2005                       153                   52,000       340
  2006                       155                   53,068       342
  Projection                                       Average 1997-2006 342
  2011                       172                   69,539       404
  2016                       181                   73,326       404
  2026                       201                   81,228       404
  CAGR 1997-2006             -1.83%                -0.45%

  CAGR 2006-2026             1.30%                 2.15%
  Source: Airport Administration Records
  * Estimate


The operations-per-based-aircraft methodology projects steady growth throughout the forecast period.
Total GA operations are projected to increase to 69,539 in 2011, 73,326 in 2016, and 81,228 in 2026.

2.2.5    General Aviation Operations Forecast – Alternative Methodology: Market Share

Market share methodology compares the number of general aviation operations at Billings Logan
International Airport with TAF figures for the country as a whole (see Table 2-10). Between 1997 and
2006, the Airport’s market share increased 0.37 percent annually. This yearly increase is held constant
throughout the forecast period and multiplied by the corresponding TAF projections. With the Rocky
Mountain School projections added, this methodology predicts 70,626 GA operations in 2011, 79,035 in
2016, and 99,083 in 2026, a CAGR of 3.17%.




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Final Report – October 2009
CHAPTER 2                                                                     FORECASTS OF AVIATION DEMAND



 Table 2-10. GA Operations Forecast – Market Share
                                                   Total U.S. GA Operations     Billings Market
 Year                    GA Operations
                                                   (FAA TAF)                    Share
 Historic
 1997                    55,278                    36,833,300                   0.1501%
 1998                    58,374                    38,046,500                   0.1534%
 1999                    66,617                    39,999,600                   0.1665%
 2000                    65,136                    39,878,500                   0.1633%
 2001                    66,318                    37,627,000                   0.1763%
 2002                    50,629                    37,623,200                   0.1346%
 2003                    49,670                    35,523,500                   0.1398%
 2004                    48,762                    34,967,600                   0.1394%
 2005                    52,000                    34,101,900                   0.1525%
 2006                    53,068                    34,074,200                   0.1557%
 Projection
 2011                    60,001                    37,821,100                   0.1586%
 2016                    67,785                    41,945,700                   0.1616%
 2026                    86,583                    51,635,600                   0.1677%
 CAGR 1997-2006          -0.45%                    -0.86%
 CAGR 2006-2026          2.48%                     2.10%
 Source: Airport Tower Records, FAA TAF forecasts



2.2.6    General Aviation Operations Forecasts - Method Comparison and Preference

As with enplanement comparisons, this section evaluates selected projections and determines a
preferable forecast methodology. Again, projections should be within an acceptable margin of error of the
FAA’s figures unless there is ample justification for discrepancies. General Aviation Operations forecasts
are shown in Table 2-11. Rocky Mountain School of Aviation projections have been added to figures in
the table, except for FAA estimates.




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CHAPTER 2                                                                 FORECASTS OF AVIATION DEMAND



Table 2-11. General Aviation Operations Forecast Comparison
                        FAA TAF           Operations per Based          Market Share
Year
                        Projection        Aircraft Projection           Projection
Projected
2006                    52,585            53,068                        53,068
2011                    59,612            69,539                        70,626
2016                    66,451            73,326                        79,035
2026                    79,094            81,228                        99,083
CAGR 1997-2006          -0.63%            -0.45%                        -0.45%
CAGR 2006-2026          2.06%             2.15%                         3.17%
Sources: Woods & Poole, Mead & Hunt, FAA



Operations per Based Aircraft Projection
The number of based aircraft at the Airport has fluctuated significantly during the study period. This has
been due to a number of factors including the relocation of some general aviation pilots and the departure
of a Fixed Base Operator. Despite a gradual increase in the number of aircraft at the Airport from 2002 to
2006, the number of operations during that time has remained somewhat steady. Section 2.3 describes
the preferred based aircraft forecast methodology in greater detail but for purposes of this section, it is fair
to say that operations per based aircraft projections are reasonable but conservative.

Market Share Projection
Market share projections reveal a steady increase in the Airport’s proportion of GA operations throughout
the 20 year forecast period. The FAA also predicts steady growth in the GA sector. These national
projections account for foreseeable economic and industry shifts, which makes the market share
projection a more aggressive forecast when applied to the Airport. Because it incorporates already
established national GA operations figures, market share is the preferred projection methodology.
General aviation operations forecast comparisons are shown in Table 2-12.




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CHAPTER 2                                                             FORECASTS OF AVIATION DEMAND



Table 2-12. General Aviation Operations Forecast Comparison

                  GA                 TAF           Operations per   %                          %
Year                                                                                 Market
                                                                    Difference                 Difference
                  Operations         Forecast      Based Aircraft                    Share
                                                                    TAF                        TAF
Historic
  1997            55,278
  1998            58,374
  1999            66,617
  2000            65,136
  2001            66,318
  2002            50,629
  2003            49,670
  2004            48,762
  2005            52,000
  2006            53,068
Projected
  2011                               59,612        69,539           16.7%            70,626    18.5%
  2016                               66,451        73,326           10.3%            79,035    18.9%
  2026                               79,094        81,228           2.7%             99,083    25.3%
CAGR 1997-
                                     -0.63%                                          -0.45%
2006                                               -0.45%
CAGR 2006-
                                     2.06%                                           3.17%
2026                                               2.15%
Sources: Woods & Poole, Mead & Hunt
Note: Income figures are given in 2006 dollars



2.2.7    Commercial Aircraft Operation Forecast – Alternative Methodology: Aircraft Fleet

Regional air service is an important component of passenger activity at the Airport. Based on historic air
service figures, it was determined that regional service should be examined separately from total
operations. This section presents an alternative methodology that projects commercial aircraft operations
based on a combination of TAF and T-100 data, and fleet size assumptions. T-100 information is
obtained from the Department of Transportation and examines aircraft capacity and load factor. There are
general trends in aviation activity locally and nationally that cannot necessarily be calculated, but are
worth notation as they pertain to goals and objectives listed in this document.

The volatility of the aviation industry has already been addressed in this Master Plan. Airlines that have
seen diminishing profits in recent years have been forced to find solutions to such financial problems. In
many cases, this has resulted in reduced air service both in flight frequency and number of markets.

While passenger enplanements at the Airport have increased, the number of scheduled commercial
departures has been reduced, which increased flight capacity and load factor (see Table 2-13).

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CHAPTER 2                                                                     FORECASTS OF AVIATION DEMAND




Table 2-13. Scheduled Aircraft Departures

                                 2003              2004      2005      2006
Total
  Departures                     11,698            11,777    12,061    10,510
   Seats                         617,934           634,942   626,492   560,394
   Passengers                    385,529           414,775   417,658   406,029
   Load Factor                   67.4              68.2      70.6      76.8
   Passengers/Departure          33.0              35.2      34.6      38.6
   Seats/Departure               52.8              53.9      51.9      53.3
Source: T-100 Data


Despite an overall increase in passengers on scheduled commercial flights between 2003 and 2006,
there was a decrease in regional enplanements at the Airport during that time period (see Table 2-14).
These markets are served by Big Sky Airlines and as of 2006 included Boise, Gillette, Great Falls
(discontinued as of 2007), Helena, Lewiston, Miles City, Missoula, Wolf Point, and Sydney. Between 2003
and 2006, regional activity accounted for 37.6 percent of all departures but only 8.3 percent of passenger
enplanements. Because aircraft that fly these routes have fewer than 60 seats, they are considered air
taxi operations rather than air carrier operations.



Table 2-14. Big Sky Airlines Commercial Aircraft Departures

                                 2003              2004      2005      2006
Total
  Departures                     5,185             3,744     4,174     4,124
   Seats                         98,118            71,136    79,173    79,838
   Passengers                    45,162            35,476    34,594    25,638
   Load Factor                   47.8              52.9      45.6      35.0
   Passengers/Departure          8.7               9.5       8.3       6.1
   Seats/Departure               18.9              19.0      19.0      18.9
Source: T-100 Data


Conversely, markets served by commercial carriers other than Big Sky Airlines between 2003 and 2006
accounted for 62.4 percent of all departures and 91.7 percent of passenger enplanements. Non-regional
departures have also been curbed by service providers. However, load factor and passenger
enplanements increased significantly between 2003 and 2006 (see Table 2-15).




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CHAPTER 2                                                                   FORECASTS OF AVIATION DEMAND



    Table 2-15. Commercial Aircraft Departures (Excludes Big Sky Airlines)
                                     2003          2004           2005        2006
    Total
      Departures                     6,513         8,033          7,887       6,296
      Seats                          519,816       563,806        547,319     480,556
      Passengers                     340,367       379,299        383,064     380,391
      Load Factor                    68.8          68.8           71.8        79.2
      Passengers/Departure           52.3          47.2           48.6        60.4
      Seats/Departure                79.8          70.2           69.4        76.3
    Source: T-100 Data


It is important to note that service to Phoenix provided by US Airways/America West discontinued in
January 2006. This route accounted for nearly 38,000 passenger enplanements annually between 2003
and 2005. This, and airline bankruptcies were the primary reasons for the decline in enplanements in
2006. Biweekly service has since been resumed by Allegiant Air.

One variable that remained relatively constant for both regional and overall commercial departures
between 2003 and 2006 has been the number of seats per departure. Though the number of departures
at the Airport has declined, the number of seats per flight remained stable. Based on these findings and
enplanement projections, the alternative commercial air carrier operations projection methodology makes
some general assumptions:


•     Regional commercial air travel activity has diminished both in departures and the number of
      passengers who use the service. This trend could be due to several factors including the price of fuel,
      service frequency, access to charter or air taxi flights, passenger satisfaction, carrier quality, ticket
      fares, or changes in the regional economy. It is assumed that regional departures and the passenger
      levels will continue to decline in the short-term until conditions become more favorable.
•     Based on historic enplanement figures, local demand of air travel should increase.
•     The combination of an increase in passenger enplanements and a decrease in departures will result
      in higher load factors. To accommodate these increases, carriers will likely introduce larger aircraft
      with additional seats on routes that have particularly high load factors.

The alternative commercial air carrier operation projection methodology uses an assumed threshold load
factor (passengers/seats) of 85 percent. This is based on industry trends as well as historic figures of air
service frequency and aircraft capacity at the Airport.

The proportion of passengers on air carrier flights to overall enplanements between 2003 and 2006 was
91.7 percent. This percentage is applied to preferred enplanement projections to obtain expected
passengers on air carrier flights for years 2011, 2016, and 2026. The assumed load factor of 85 percent
is applied to determine the number of expected seats for the same years.



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CHAPTER 2                                                                 FORECASTS OF AVIATION DEMAND


It is also assumed that the number of passengers per departure will increase at the same rate as the
number of expected passengers; 3.37 percent from 2006 to 2011, 3.53 percent from 2012 to 2016, and
4.06 percent from 2017 to 2026.

Dividing the number of expected passengers by passengers per departure reveals the expected number
of departures. This figure is multiplied by two to project the number of operations (see Table 2-16).


 Table 2-16. Air Carrier Aircraft Operations Forecast
                                   Passengers/
                                                   Passengers/
 Year             Passengers       Seats           Departure      Seats          Departures     Operations
 Historic
   2003           340,367          65.5%           52.3           617,934        6,513
   2004           379,299          67.3%           47.2           634,942        8,033
   2005           383,064          70.0%           48.6           626,492        7,887
   2006           380,391          79.2%           60.4           560,394        6,296
 Projection
   2011           444,433          85.0%           62.5           646,760        7,116          14,232
   2016           522,901          85.0%           64.7           760,307        8,087          16,174
   2026           735,151          85.0%           67.3           1,068,922      10,926         21,852
 Source: T-100 data, Mead & Hunt
 Note: T-100 data and enplanement figures have different sources and slightly different values therefore CAGR
 calculations would be inaccurate.


2.2.8    Commercial Operations Forecast – Method Comparison and Preference

Projected commercial air carrier operations are combined with projected air taxi operations to obtain total
commercial operations. Because of recent fluctuation of air taxi (regional) operations and the departure of
Big Sky Airlines in early 2008, TAF projections for air taxi operations were used. Because the alternative
fleet size methodology incorporates capacity and load factor trends, it is the preferred forecast (see Table
2-17). Projected operations for the Rocky Mountain School of Aviation are included in total operations.




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Final Report – October 2009
CHAPTER 2                                                                  FORECASTS OF AVIATION DEMAND




 Table 2-17. Comparison of Total Operations Forecasts
                        2006                2011             2016               2026
 TAF:
   Commercial      50,092                   54,100           58,684             68,841
   GA              52,585                   59,612           66,451             79,094
   Military        782                      782              782                782
   Total           103,459                  114,494          125,765            154,781
 Alternative Methodologies:
   Commercial      49,227                   56,326           62,700             78,688
   GA              53,068                   70,626           79,035             99,083
   Military*       493                      458              458                458
   Total           102,838                  127,410          142,193            178,229
 Alt. Method/TAF
                                            11.3%            13.1%              15.2%
 (% Difference)
  Source: FAA TAF, Airport Tower Records, Mead & Hunt
  * Military operations are based on the average annual TAF figures from 2002-2006


Market share projections for general aviation operations are combined with the alternative fleet size
projections for commercial operations to produce total operations; 127,410 in 2011, 142,193 in 2016, and
178,229 in 2026 (see Table 2-18, Chart 2-2).


 Table 2-18. Operations Forecast – Preferred Methodology
 Year                           Commercial         GA       Military*   Total
 Historic
   1997                         41,830             55,278   119         97,227
   1998                         44,016             58,374   322         102,712
   1999                         48,886             66,617   204         115,707
   2000                         51,299             65,136   626         117,061
   2001                         50,280             66,318   549         117,147
   2002                         51,314             50,629   502         102,445
   2003                         51,249             49,670   496         101,415
   2004                         50,229             48,762   447         99,438
   2005                         51,527             52,000   354         103,881
   2006                         49,277             53,068   493         102,878
 Projection
   2011                         56,326             70,626   458         127,411
   2016                         62,700             79,035   458         142,193
   2026                         78,688             99,083   458         178,229
 CAGR 1997-2006                 1.84%              -0.45%   17.11%      0.63%
 CAGR 2006-2026                 2.37%              3.17%    -0.37%      2.76%
 Source: Airport Tower Records, T-100 Data, Mead & Hunt


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Final Report – October 2009
CHAPTER 2                                                                               FORECASTS OF AVIATION DEMAND



                                        Chart 2-2. Operations Forecast - Preferred
                             Historic                           Forecast
                180,000

                160,000

                140,000

                120,000
   Operations




                100,000

                 80,000

                 60,000

                 40,000

                 20,000

                     0
                     1996               2001        2006             2011               2016             2021            2026

                            Commercial Operations          GA Operations         Military Operations      Total Operations



2.2.9             Operations Forecast - Rocky Mountain College

General Aviation and total operations already reflect the perceived impact that the relocation of the Rocky
Mountain School of Aviation will have. Preferred forecast methodologies for operations are matched with
TAF projections adjusted for these changes in Table 2-19.



 Table 2-19. Total Operation Projections with Rocky Mountain College

                                                    Preferred              TAF    with      Preferred                 % Difference
                                  TAF
                                                    Methodology            Rocky            Methodology with          from
                                  Operations
                                                    Operations             School           Rocky School              FAA TAF
 Total
        2006                      103,459           102,838                N/A                         N/A
        2011                      114,494           116,786                125,119                     127,411               11.3%
        2016                      125,765           130,943                137,015                     142,193               13.1%
        2026                      154,781           165,729                167,281                     178,229               15.2%
        CAGR 2006-2026            2.03%             2.41%                  2.43%                       2.76%
 Source: Rocky Mountain College Aviation Program, Mead & Hunt, FAA TAF, Airport Tower Records




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Final Report – October 2009
CHAPTER 2                                                              FORECASTS OF AVIATION DEMAND


2.3       Based Aircraft

Based aircraft are aircraft operating and terminating round-trip travel at the Airport and are stored on a
semi-permanent basis. Most based aircraft are registered locally, and stored in hangars or on ramps.
Based aircraft include general aviation aircraft and charter commercial passenger service aircraft.

Observed based aircraft data is provided by Airport management, and reported by the FAA in its 5010
form. The FAA provides annual inspection of the Airport to obtain these numbers as well as facilities
inventory. Actual historic data as opposed to estimates provides more accurate projections.

This Master Plan categorizes based aircraft as single-engine piston (single), multi-engine piston (multi),
turbine engine (jet), and helicopter.

The following subsections will describe:


•     History and trends of based aircraft at the Airport
•     Historic FAA TAF figures and projections
•     Alternative projection methodology
•     Method comparison and preference
•     Critical aircraft

2.3.1     Based Aircraft History

In 1997, there were 183 based aircraft at the Airport; by 2006 that number decreased to 155 (see Table
2-20). The most significant decrease occurred between 2000 and 2001. In one year, the number of
aircraft at the Airport dropped from 217 to 145. Among the reasons for this decline were increases in fuel
prices and hangar/lease space, which influenced some GA aircraft owners to relocate to nearby Laurel
Airport. Another reason for the decrease in based aircraft is the departure of a local Fixed Base Operator,
Corporate Air. A third reason is that at that time, Edwards Jet Center disposed of a number of single-
piston aircraft.

GA activity has rebounded at Billings Logan International Airport and because of demand, a number of
new hangars have been built within recent years which will tend to attract additional based aircraft from
competing airports in the area.




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Final Report – October 2009
CHAPTER 2                                                                   FORECASTS OF AVIATION DEMAND



 Table 2-20. Based Aircraft History
 Year                    Based Aircraft
 1997                    183
 1998                    183
 1999                    206
 2000                    217
 2001                    145
 2002                    145
 2003                    136
 2004                    151
 2005                    153
 2006                    155
 CAGR 1997-2006          -2.05%

 Source: FAA 5010 Form


2.3.2    Based Aircraft Forecast – FAA Terminal Area Forecast

Since the decline in based aircraft in 2000-2001, there has been a steady increase in the number of
based aircraft at the Airport. The FAA predicts no growth in the future as shown in Table 2-21.


Table 2-21. Based Aircraft Forecast – FAA Terminal Area Forecast
Year                    Single        Jet          Multi       Helicopter      Total
Historic
1997                    140           1            40          2               183
1998                    140           1            40          2               183
1999                    154           3            44          5               206
2000                    154           3            44          5               206
2001                    73            5            62          5               145
2002                    73            5            62          5               145
2003                    73            5            62          5               145
2004                    71            10           65          5               151
2005                    77            9            62          5               153
2006                    77            9            62          5               153
Projection
2011                    77            9            63          5               154
2016                    78            9            63          5               155
2026                    78            9            63          5               155
CAGR 1997-2006          -6.43%        15.29%       4.61%       10.72%          -1.83%
CAGR 2006-2026          0.06%          0.00%        0.00%       0.00%           0.00%
Source: FAA TAF




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Final Report – October 2009
CHAPTER 2                                                                 FORECASTS OF AVIATION DEMAND


In order to provide a reasonable basis, alternate projections of based aircraft have been prepared. These
are discussed in the following sections.

2.3.3    Alternative Based Aircraft Forecast – Socioeconomic Methodology

The socioeconomic methodology uses the ratio of based aircraft at the Airport to the number of people
who live in the Billings MSA (see Table 2-22). The average ratio for the entirety of the study period is
roughly one aircraft for every 840 persons. In 2006, there was one aircraft for every 950 residents. The
latter figure is paired with population projections to forecast based aircraft. The methodology projects 164
based aircraft in 2011, 173 in 2016, and 193 in 2026, a CAGR of 1.10 percent. The number of based
aircraft at the Airport during the study period fluctuated significantly so the ratio used in this methodology
may be considered conservative.


 Table 2-22. Based Aircraft Forecast – Socioeconomic Methodology
                                                                    Based Aircraft Per
 Year                       Based Aircraft         Population
                                                                    Capita
 Historic
 1997                       183                    136,620          0.00134
 1998                       183                    137,000          0.00134
 1999                       206                    138,230          0.00149
 2000                       217                    139,130          0.00156
 2001                       145                    140,240          0.00103
 2002                       145                    141,600          0.00102
 2003                       136                    142,900          0.00095
 2004                       151                    144,510          0.00104
 2005                       155                    146,480          0.00104
 2006                       155                    148,120          0.00105
 Projected
 2011                       164                    156,900          0.00105
 2016                       173                    165,730          0.00105
 2026                       193                    184,310          0.00105
 CAGR 1997-2006             -2.05%                     0.98%
 CAGR 2006-2026             1.10%                      1.10%
 Source: FAA 5010 Form, Woods & Poole, Inc.



For final based aircraft projections, it is necessary to include the eight aircraft from the Rocky Mountain
School Aviation Program. These modifications result in 172 based aircraft in 2011, 181 in 2016, and 201
in 2026 a CAGR of 1.30%. These changes are reflected in Table 2-23.




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Final Report – October 2009
CHAPTER 2                                                                     FORECASTS OF AVIATION DEMAND




 Table 2-23. Based Aircraft Forecast – Method Comparison
                                            Socioeconomic (Preferred)
 Year         Historic      FAA TAF
                                            Forecast*                 Socio/TAF (% Difference)
 Historic
 1997         183
 1998         183
 1999         206
 2000         217
 2001         145
 2002         145
 2003         136
 2004         151
 2005         155
 2006         155
 Projection
 2011                       154             172                       11.7%
 2016                       155             181                       16.8%
 2026                       155             201                       29.7%
 Source: FAA TAF
 * Projections include eight aircraft owned by the Rocky Mountain School of Aviation


2.3.4    Based Aircraft Forecasts – Method Comparison and Preference

Though the number of based aircraft at the Airport has declined since 2000, the two selected projections
reveal varied results (see Chart 2-3). In large part due to this decline, the FAA predicts minimal growth
during the projection period. The socioeconomic method shows growth consistent with population
projections in Billings over 20 years. There are many factors that influence the number of based aircraft at
an airport, which includes ownership and operation costs. This may explain the discrepancy in FAA
forecasts.




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Final Report – October 2009
CHAPTER 2                                                                                   FORECASTS OF AVIATION DEMAND



                                                   Chart 2-3. Base d Aircraft - Com paris on


                           230

                           210

                           190

                           170
          Based Aircraft




                           150

                           130

                           110

                           90

                           70

                           50
                                 1996




                                                   2001




                                                               2006




                                                                             2011




                                                                                            2016




                                                                                                        2021




                                                                                                                  2026
                                        Historic          Forecast - TAF            Forecast - Socioeconomic

 Sour ces: Mead &Hunt, FAA5010 For m




Based on recent historic trends in population growth and other variables, the socioeconomic projection is
the preferred methodology. These figures exceed the acceptable margin of error when compared with
TAF but the FAA has indicated that they do not consider the difference in the based aircraft projections
between the TAF and this study to be a significant issue in the preparation of this Master Plan.

2.3.5          Critical Aircraft

The Airport Reference Code (ARC) is a system developed by the FAA to relate airport criteria to the
operational and physical characteristics of the aircraft at an airport. The ARC has two components
relating to the airport design aircraft. The first component, depicted by a letter, is the aircraft approach
category and relates to certified aircraft approach speed. Generally, aircraft approach speed applies to
runways and runway related facilities. Based on Advisory Circular 5300-13, Changes 1-10, Airport
Design, aircraft are grouped into five categories (typical aircraft examples shown):

  Category A: Approach speeds less than 91 knots.
              (Cessna 172, Beech Baron B55, Piper Cherokee)
  Category B: Approach speed of 91 knots or more, but less than 121 knots.
              (Beech King Air, Cessna 402/Citation I, Learjet 28/29)
  Category C: Approach speed of 121 knots or more, but less than 141 knots.
              (Learjet 24, Westwind, Canadair CL-600, Gulfstream G-III)
  Category D: Approach speed of 141 knots or more, but less than 166 knots.
              (Gulfstream G-II/IV)
  Category E: Approach speed of 166 knots or more. (Limited to high performance military aircraft)

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Final Report – October 2009
CHAPTER 2                                                               FORECASTS OF AVIATION DEMAND




The second component depicted by a Roman numeral, is the airplane design group and related to aircraft
wingspan. Aircraft wingspan primarily relates to separation requirements of taxiways and ramp space
area as indicated below (typical aircraft examples shown):

  Group I:        Wingspans up to but not including 49 feet.
                  (Cessna 172, Beech King Air B100, Cessna Citation I)
  Group II:       Wingspans of 49 feet up to but not including 79 feet.
                  (Beech Super King Air 200, Grumman G-III, Canadair CRJ-200/701, Embraer 120)
  Group III:      Wingspans of 79 feet up to but not including 118 feet.
                  (Lockheed P-3, MDC-DC-9, DeHavilland Dash 8 Q400)
  Group IV:       Wingspans of 118 feet up to but not including 171 feet.
                  (Airbus A-300, Boeing 757/767, Canadair CL-44)
  Group V:        Wingspans of 171 feet up to but not including 214 feet.
                  (Boeing 747-all, Boeing 777)
  Group VI:       Wingspan of 214 feet up to but not including 262 feet.
                  (Airbus A-380, Lockheed C-5B Galaxy)

The Billings airport is currently classified as an ARC D-IV airport. To justify a certain design ARC and
therefore a design standard, 500 operations of the design aircraft must be documented to occur within a
year or actual unmet demand must be documented (i.e. If runway were to be extended, the airport would
be used by larger aircraft). The “design” aircraft may be a composite of various models that use the
airport a total of at least 500 times per year (500 operations). The most demanding aircraft that currently
operate at Billings Logan International Airport include Boeing 737’s (ARC C-III) and MD 83’s (ARC C-III)
as well as the Airbus A-319 (ARC C-III) and A-300/600 (ARC C-IV), Canadair CL-600 (ARC C-II), as well
as a range of business jets like the Learjet 35/36 (ARC D-I), Gulfstream IV (D-II). Together these aircraft
record 500 operations at the airport annually and the combination of their wingspans and approach
speeds are indicative of a D-IV categorization. Local and national trends reveal that aircraft activity by
these types is likely to increase during the 20-year projection period. Therefore, a D-IV Airport Reference
Code should remain in effect.


2.4      Air Cargo

Air cargo is considered to be mail or freight that passes through the Airport. Air mail at Billings Logan
International Airport is carried solely by non-commercial air cargo service carriers under contracts with the
U.S. Postal Service.

Freight cargo is defined as all non-mail cargo. For this Master Plan, mail and freight will be combined and
reported as cargo. This section examines historic cargo activity to produce forecasts to 2026. The
following subsections are addressed:




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Final Report – October 2009
CHAPTER 2                                                              FORECASTS OF AVIATION DEMAND



•   Historic air cargo figures
•   Boeing Air Cargo Forecast
•   Alternative forecast
•   Methodology comparison and preference

2.4.1    Air Cargo History

Air cargo projections examine historic data that include enplaned pounds of mail and freight at the Airport
(see Table 2-24). Weight of enplaned cargo at the Airport increased considerably during the study period;
33,919,386 pounds were enplaned in 2006, more than twice the 14,506,896 pounds loaded in 1997. It is
important to note that some cargo traditionally enplaned at the Airport was temporarily relocated onto
trucks, which helps explain a drop-off in total enplaned cargo weight after the year 2000. This appears to
have been an approach to lower shipping costs but cargo operations have since returned to the Airport.


Table 2-24. Air Cargo History
                        Enplaned
Year
                        Cargo (pounds)
1997                    14,506,896
1998                    13,071,408
1999                    20,687,930
2000                    32,648,939
2001                    21,551,742
2002                    15,365,602
2003                    19,999,457
2004                    33,622,047
2005                    28,277,983
2006                    33,919,386
CAGR 1997-2006          9.90%
Source: Airport Administration Records



2.4.2    Air Cargo Forecast – Boeing Trends

The Boeing Company’s World Air Cargo Forecast evaluates regional and global air cargo trends to
project cargo activity. Boeing details that national air cargo weight experienced a downturn in 2001,
recovered in 2002-2004, then declined again in 2005. Enplaned cargo at the Airport mirrors these findings
(see Table 2-25). Applying Boeing’s 3.8 percent annual growth rate to 2006 enplaned cargo at the Airport
results in 40,872,834 pounds of cargo in 2011, 49,872,834 pounds in 2016, and 71,514,656 pounds in
2026.




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Final Report – October 2009
CHAPTER 2                                                            FORECASTS OF AVIATION DEMAND




 Table 2-25: Air Cargo Forecast – Boeing Trends
                           Enplaned
 Year                      Cargo               Annual Change
                           (pounds)
 Historic
   1997                    14,506,896
   1998                    13,071,408          -9.90%
   1999                    20,687,930          58.27%
   2000                    32,648,939          57.82%
   2001                    21,551,742          -33.99%
   2002                    15,365,602          -28.70%
   2003                    19,999,457          30.16%
   2004                    33,622,047          68.11%
   2005                    28,277,983          -15.89%
   2006                    33,919,386          19.95%
 Projection                                    3.8% Annual Growth
   2011                    40,872,834
   2016                    49,251,733
   2026                    71,514,656
 CAGR 1997-2006            9.90%
 CAGR 2006-2026            3.80%
 Sources: Airport Administration Records, The Boeing Company,
 Mead & Hunt, Inc.



2.4.3    Alternative Air Cargo Forecast – Market Share Methodology

The market share methodology compares enplaned cargo at Billings Logan International Airport with the
national total. Because there was a significant decline in the Airport’s market share of enplaned cargo
after 2001, the average share between 2002 and 2006 of 0.115 percent was examined. Historic cargo
figures are obtained from Bureau of Transportation Statistics Intermodal Transportation (see Table 2-26).
When Boeing’s forecasted annual national air cargo increase of 3.80 percent is applied to the U.S. total
from 2006, the result is 34,256,639 pounds of enplaned cargo at the Airport in 2011, 41,279,223 pounds
in 2016, and 59,938,387 pounds in 2026.




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Final Report – October 2009
CHAPTER 2                                                                    FORECASTS OF AVIATION DEMAND




 Table 2-26. Air Cargo Forecast – Market Share
                         Enplaned Cargo                                             Billings
 Year                                                    Total U.S Air Cargo
                         (pounds)                                                   Market Share
 Historic
   1997                  14,506,896                       6,875,358,666              0.221%
   1998                  13,071,408                      6,249,056,422              0.209%
   1999                  20,687,930                      6,282,568,301              0.329%
   2000                  32,648,939                      6,254,224,486              0.522%
   2001                  21,551,742                      10,217,790,921             0.211%
   2002                  15,365,602                      13,550,672,554             0.113%
   2003                  19,999,457                      24,604,138,932             0.081%
   2004                  33,622,047                      25,568,999,483             0.131%
   2005                  28,277,983                      25,102,124,574             0.113%
   2006                  33,919,386                      24,662,283,586             0.138%
 Projection
   2011                  34,256,639                      29,718,032,606             0.115%
   2016                  41,279,223                      35,810,206,256             0.115%
   2026                  59,938,387                      51,997,247,847             0.115%
 CAGR 1997-2006          9.90%                           15.25%
 CAGR 2006-2026          2.89%                           3.80%
 Sources: Airport Administration Records, Bureau of Transportation Statistics Intermodal
 Transportation Database, Mead & Hunt




Billings Logan International Airport Master Plan            2-30
Final Report – October 2009
CHAPTER 2                                                                                        FORECASTS OF AVIATION DEMAND


2.4.4                Air Cargo Forecasts – Method Comparison and Preference

A comparison of future air cargo enplanement activity based on the two different projections is presented
in Table 2-27 and Chart 2-4.


 Table 2-27. Air Cargo Forecast – Method Comparison
 Year                                   Historic                                Boeing                    Market Share
 Historic
   1997                                 14,506,896
   1998                                 13,071,408
   1999                                 20,687,930
   2000                                 32,648,939
   2001                                 21,551,742
   2002                                 15,365,602
   2003                                 19,999,457
   2004                                 33,622,047
   2005                                 28,277,983
   2006                                 33,919,386
 Projection
   2011                                                                         40,872,834                34,256,639
   2016                                                                         49,251,733                41,279,223
   2026                                                                         71,514,656                59,938,387
 CAGR 1997-2006                         9.90%
 CAGR 2006-2026                         2.89%                                   3.80%                     2.89%
 Sources: Airport Administration Records, The Boeing Company, Mead & Hunt, Inc.



                                                           Chart 2-4. Air Cargo Comparison
                                    Historic                                      Projected
                   80,000,000
                   70,000,000
                   60,000,000
                   50,000,000
    Cargo (lbs.)




                   40,000,000
                   30,000,000
                   20,000,000
                   10,000,000
                           0
                           1996                    2001                  2006       2011         2016             2021       2026

 So urce: A irpo rt reco rds, B ureau o f Transpo rtatio n Statistics,                Historic   Boeing       Market Share
 B o eing Wo rld Cargo Fo recast 2006-2007




Billings Logan International Airport Master Plan                                  2-31
Final Report – October 2009
CHAPTER 2                                                               FORECASTS OF AVIATION DEMAND


The Boeing Company’s projection provides a preferable air cargo forecast. Although the projection is a
nationally expected increase that has been applied to a particular location, Boeing’s information is
extensive, well-based, and generally accepted by the aviation industry.

The Airport should closely monitor air cargo traffic. According to FAA Advisory Circular 150/5000-11,
airports that record over 100 million pounds of landed cargo annually are eligible for federal
apportionments.


2.5      Peak Aviation Demand Characteristics

An important component of this Master Plan is identification of peak demand times and figures. These
projections are important for various facility planning purposes. Facility and equipment requirements are
often determined by peak passenger and operation activity in a given timeframe. This section features
annual, monthly, daily, and hourly peak figures for airport passenger activity (enplanements plus
deplanements), passenger enplanements, and operations. Base year 2006 and projected figures were
derived using the following methodologies:


•     Historic monthly enplanement and operation data were supplied by Airport management. For total
      monthly passenger activity, T-100 data for the peak month in 2006 were used.
•     The peak month in base year 2006 (July) consisted of 31 days (see Exhibit 2-1). To estimate
      average daily activity, monthly figures were divided by 31.
•     T-100 data includes daily departure and arrival times, aircraft seat capacity, and the number of
      passengers. The average monthly load factor for that peak month was applied to all departing and
      arriving aircraft to determine the number of enplaned/deplaned passengers for each day of the week.
      Peak passenger activity (when the most enplaned and deplaned passengers would be at the Airport)
      was determined to be Monday through Friday between 12:30pm and 1:30pm. The peak level for
      enplanements occurred between 6:00am and 7:00am, Sunday through Monday.
•     Projections for monthly operations are based on the ratio of monthly to annual operations in base
      year 2006. Preferred methodologies for annual commercial and general aviation operations are
      applied.
•     Experience has shown that approximately 90% of total daily operations will occur between the hours
      of 7:00 AM and 7:00 PM (12 hours) at a typical airport, and that the maximum peak hourly occurrence
      may be 50% greater than the average of the hourly operations calculated for this time
      period.Therefore, the Estimated Peak Hourly Demand (P) in a given month was determined by
      compressing 90% of the Average Daily Operations (D) in a given month into the 12 hour peak use
      period, reducing that number to an hourly average for the peak use period, and increasing the result
      by 50%, as follows:

         Where D           =        Average Daily Operations in a given month.
               P           =        Peak Hourly Demand in a given month.
               P           =        1.5 ( 0.90D ÷ 12 hours)

Peak aviation demand characteristics are presented in Table 2-28.

Billings Logan International Airport Master Plan         2-32
Final Report – October 2009
CHAPTER 2                                                 FORECASTS OF AVIATION DEMAND




Billings Logan International Airport Master Plan   2-33
Final Report – October 2009
CHAPTER 2                                                                       FORECASTS OF AVIATION DEMAND


 Table 2-28. Peak Aviation Demand Characteristics
                                                                                           Aircraft Operations
                                      Passenger
                                      Activity
                                      Enplanements
                                      +
 Year     Peak Factor                 Deplanements           Enplanements        Commercial     GA       Military   Total
 2006     Actual
          Annual                      830,020                415,020             49,227         53,068   493        102,838
          Peak Month                  90,081                 45,807              4,718          5,521    52         10,298
          Peak Month Avg. Day         2,906                  1,478               152            178      1          339
          Peak Hour                   511                    370                 27             31       1          38
 2011     Annual                      963,517                484,659             56,326         70,626   458        127,410
          Peak Month                  104,569                53,458              5,398          7,348    48         12,754
          Peak Month Avg. Day         3,373                  1,725               174            237      1          419
          Peak Hour                   593                    431                 31             41       1          47
 2016     Annual                      1,139,669              570,230             62,700         79,035   458        142,193
          Peak Month                  123,687                62,896              6,009          8,223    48         14,234
          Peak Month Avg. Day         3,990                  2,029               194            265      1          468
          Peak Hour                   702                    507                 34             46       1          53
 2026     Annual                      1,602,272              801,692             78,688         99,083   458        178,229
          Peak Month                  173,893                88,427              7,542          10,308   48         17,841
          Peak Month Avg. Day         5,610                  2,853               243            333      1          587
          Peak Hour                   986                    713                 43             58       1          66
 Source: Airport Tower Records, Airport Administration Records, T-100 Data, Mead & Hunt, Inc.
 Note: Projected GA and Total Operations include Rocky Mountain School estimates



2.6       Projection Summary

A summary of aviation demand projections for Billings Logan International Airport is presented in Table 2-
29. Passenger enplanements, aircraft operations, based aircraft, and air cargo by weight are included.


Table 2-29. Summary of Aviation Demand Forecasts

                           Passenger               Aircraft                               Air Cargo
Year                                                                   Based Aircraft
                           Enplanements            Operations                             (pounds)
   2006                    415,298                 102,838             155                33,919,386
   2011                    484,659                 127,411             172                40,872,834
   2016                    570,230                 142,193             181                49,251,733
   2026                    801,692                 178,229             201                71,514,656
   CAGR 2006-2026          2.97%                   2.76%               1.30%              3.80%
Source: Mead & Hunt




Billings Logan International Airport Master Plan                2-34
Final Report – October 2009

								
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