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High Speed Rail Trade Off Disad

High Speed Rail Trade Off Disad

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Published by Ahmed Malik

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Published by: Ahmed Malik on Oct 14, 2012
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HSR T-OFF DA 
1
Dizzle Ranch Debate
High Speed Rail Trade Off Disad
 
HSR T-OFF DA 
2
Dizzle Ranch Debate
A. Uniqueness: Airlines group lifts 2012 profit outlook for industry to $4.1billion from$3 billion Associated Press.
"Airlines Group Lifts 2012 Profit Outlook for Industry to $4.1billion from $3 Billion."
Fox News
. FOX News Network,
01 Oct. 2012.
Web. 14 Oct. 2012.
 
<http://www.foxnews.com/travel/2012/10/01/airlines-group-lifts-2012-profit-outlook-for-industry-to-41billion-from-3/>.
The outlook for the airline industry is improving, with profits expected to reach $4.1 billion this yearand $7.5 billion in 2013, the International Air Transport Association said Monday. The industry groupraised its forecast for 2012 from $3 billion
,
saying passenger numbers so far this year were
 
robust.“Airlines are
 
keeping their heads above water better than we expected,”
IATA Chief Executive Tony Tyler told reporters
. But
 
henoted th
at
profits this year will still be less than half the $8.4 billion that the industry earned in 2011.
Tyler blamed Europe’s economic cr
isis, oil prices averaging $110 a barrel, weak cargo demand and lowbusiness confidence
for the slowdown
.
A profit of $4.1 billion on industry revenues of $636 billionequates to a margin of just 0.6 percent
,
Tyler noted
.
Europe’s airlines are expected to
record a loss of $1.2 billion this year due to the eurozone financial crisis and high taxation, IATA said. It projected a$2.3 billion profit for companies in the Asia-Pacific region
,
despite a modest slowdown in the Chinese economy.
“Chinese domestic dema
nd is still growing at nearly 10 percent and the demand for regional and long-haul travel, including in
the premium classes, has held up better than expected in the face of economic uncertainty,” said Tyler.
 
The greatestimprovement is seen for North American carriers, where IATA raised its profit forecast by $500 millionto $1.9 billion
,
thanks to cost savings.Middle East and Latin American airlines are also expected to post a profit, while African carriers will break even, said IATA.
 
Tyler said the situation was likely to improve in 2013 as average oil prices ease to $105 per barrel, andgovernment and central bank measures push global GDP growth to 2.5 percent from 2.1 percent thisyear.
 
The projected profits of $7.5 billion next year equate to a margin of 1.1 percent on revenues of $660 billion, IATA said
.
The group represents some 240 of the biggest international airlines worldwide.
 
B. Link: Infrastructure projects cause massive department overstretchPoole 96
(Robert, MIT-trained engineer,http://reason.org/files/4883e8bd01480c4d96ce788feb1f2e05.pdf, pg. 2) IGM
Federal transportation grant programs be they airport, mass transit, or highway are plagued by theproblem of porkbarrel spending
. Members of Congress traditionally derive great benefits from earmarking projects for theirdistricts, regardless of cost-benefit ratios or the relative value of the project compared with alternate uses of the funds.
Since trust funddollars are always limited, this means that every bad project which jumps the queue at the behest of amember of Congress necessarily displaces a better project
(better in terms of adding real economic value). Thus,
thisprocess systematically wastes scarce transportation infrastructure resources.
 
HSR hurts demand for flights
 –
trades off with the aviation industry.
Xiaowen
Fu
, Hong Kong Polytechnic University, Animing
Zhang
, Sauder School of Business, Zheng
Lei
,Dept of Air Transport, December 16,
2011
, “Will China’s airline industry survive the entry of high
-speed
rail?” 
Competitive effect of HSR on airlines
 
Sharp competition between HSR and airlines has beenwitnessed in markets around the world,
 
particularly in short to medium routes
linking metropolitan cities. HSR
 
HSR T-OFF DA 
3
Dizzle Ranch Debate
was introduced to
Spain
in 1992 with the opening of the 472 km MadrideSevilla line. The rail share of the whole air þ rail market increasedfrom 21% in 1991 to 82% in 1993. In the
LondoneParis
route, EuroStar has, since introduced in 1994, captured about 80% of the point-to-point traffic (Steer Davies Gleave, 2006). The
Taiwan High Speed Rail
(THSR) started operation in January 2007, linking Taipei andKaohsiung along the west coast with a total distance of 335.5 km. In less than three years, THSR has
eliminated
intra-Taiwan
air travelservices
. In South Korea, the opening of 
HSR
between Seoul and Busan in 2004
has significantly reduced air traffic
betweenthe two cities. The International Transport Forum (2009) reported that
domestic air traffic
in France
declined
by 7% between 2000and 2007, which was
mostly attributable to the increased availability of HSR
connections.
Development of HSR causes competition with airplanes.
Xiaowen
Fu
, Hong Kong Polytechnic University, Animing
Zhang
, Sauder School of Business, Zheng
Lei
,Dept of Air Transport, December 16,
2011
, “Will China’s airline industry survive the entry of high
-speed
rail?” Resarch in Transportation Economics.
features in the Chinese transport market suggest that the HSR services will be competitive incity-pairs of short to medium distance, exerting
some
significant competitive pressure on airlines by
 driving yields down and
diverting traffic to rail
. The airlines will need to transform their current point-to-point networks to effective hub-and-spoke
networks
in order to expand network coverage,
rely lesson local traffic between metropolitan cities, and
turn their base airports
into international gateways
.Traffic consolidation via hubs will also allow Chinese carriers to improve service quality and productivity.Such a transformation will bring better network connectivity to small- and medium-size airports, whiledemanding continued capacity expansions at major hubs. The
increased competition in domesticmarket will likely prompt Chinese carriers to expand their international operation more quickly
, whichin turn willspeed up the process of bilateral liberalization and global strategic alliances. As a result, theinter-modal competition in the Chinese domestic market will likely influence regional or global aviationmarket.
C. Impacts:1. Aerospace key to our overall leadership and hegemony.
Christopher E.
 
Kinne
, USAF Lieutenant Colonel,
11
 
[Air Force Journal of Logistics, “Preserving the Indus:Is the United States Air Force Responsible?”, http://www.aflma.hq
.af.mil/shared/media/document/AFD-101122-031.pdf]
The commission had a great deal to say about these topics. After months of meetings and discussions covering the broad spectrum of topics,the commission published its final 300-plus page report in November 2002.
The commission report begins with a positivestatement about the US aerospace industry
 
and claims in its opening sentences that “
the role of aerospace inestablishing
America’s
global leadership was incontrovertibly proved in the last century...[and]
aerospace will be at the core of America’s leadership and strength in the twenty
-
first century.”
12However, the report also includes nine recommendations that address many concerns of the aerospace industry and the panel membersthemselves.
The commission
identified several trends
it believed must
be corrected to both
preserve the US aerospaceindustry and to improve US national security
. Most importantly, the commission observed: “
The contributions of aerospace to our global leadership have been so successful that
 
it is assumed
US preeminence inaerospace remains assured
.
 
Yet the evidence would indicate this to be far from the case.”13
 

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