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Transportation Services

Chapter Objectives
To understand the historical development of passenger transportation  To identify the roles and important aspects of ground, sea, and air transportation To understand the basic aspects of international airline regulations To identify challenges facing the transportation industry

Introduction Transportation
 Transport is the key element in the tourism industry  Transportation lies at the heart of the tourist industry  The link between home and destination  There is a direct relationship between advances in transportation and growth in the tourism industry The role of automobile and jet airplane In the case of air destinations the availability of air access is the sine qua non.

Historical Development of Passenger Travel

 Early Modes of Travel
By land (3500 BC Wheels on carts) By sea (3500 BC River boats)

Railroads and Ocean Liners

Steam engine technology (1787) Railway expansion (1814 - ) Ocean liners (trans-Atlantic Voyage)

Historical Development of Passenger Travel

Automobile and Airlines
Auto replaces trains (1885 and 1908) Plane replaces liners (1903) Development of passenger planes

Mass production of automobile pioneered by Ford Motors With mass production automobile become affordable Most popular mode of travel in the world In the U.S. 80% of person-trips are made by auto. Rental car industry growing in importance. * Grosses approximately $20 billion per year.

Airline Industry
First flight: Orville and Wilbur Wrights at Kitty Hawk (1903) Passenger Service 1910 First schedule airplane passenger began in the U.S. Introduction of Jet aircraft 1958 Jumbo Jet was introduced in 1970 Concorde began service in 1976

Airline Industry
Air transport is the main mode of International tourism The global airline industry consists of over 2,000 airlines operating more than 23,000 aircrafts Providing service to over 3,700 airports In 2006, the worlds airlines flew almost 28 million scheduled flight departures and carried over 2 billion passengers. The growth of world air travel has averaged approximately 5% per year over the past 30 years

Air Travel
Airport Taxes and Fees
 A variety of taxes and fees are to be paid to airports.  U.S. Domestic Transportation Tax (7.5%)  Federal Flight Segment Tax ($3.00)  U.S. International Departure Tax ($15.10)  U.S. International Arrival Tax ($15.10)  Passenger Facility Charges ($3.00 -18.00)  Federal Security Segment Tax ($5.00)  September 11th Security Fee up to $10  U.S. Custom fee ($5.00)  Immigration fee ($7.00)  Health Inspection Service ($3.10)

 These charges increases the total cost of airline operations and can
have a significant impact on the price of the ticket.

Air Travel
Operations Control of air traffic at in and in the vicinity of the airport Automobile rental operation Baggage processing Cargo and mail Custom and immigration operations Restaurant and retail operations

Airport Capacity
Top 15 Airports - Number of Passenger Served
2006 (000) thousands
Number of Passengers

84,846 77,028 67,530 65,810 61,041 60,226 56,849 52,810 48,655 47,325 46,193 46,065 45,501 43,858 43,762

Biggest Airports of the World (Area Square Mile)

1. King Khalid Intl Airport 2. Denver International Airport 3. Dallas Ft. Worth 81 square mile 53 square mile 30 square mile

* The area of Denver International airport is bigger than Boston or Buffalo.

Air Travel
Airline Passenger Services
Scheduled services (general public) Charter services (privately contracted)

Safety and Security

Importance of regulations Security concerns Cost of accidents

Biggest Airline Companies (2003)

Airline Companies

Passengers (000) 88,241 84,245 74,787 66,100 58,241 51,975 45,400 43,700 42,251 41,263

1 2 3 4 5 6 7 8 9 10

American Airlines Delta Airlines Southwest Airlines United Airlines Japan Airlines Northwest Airlines Deutsche Lufthansa Air France All Nippon Airways U.S. Airways

Rail Industry
Railways were the first form of mass transportation
Passenger service began in the early 1800s with railroad cars Around 1830, the Baltimore & Ohio company began using a car that held about 60 passengers The Pullman sleeping cars was patented in 1864 Reached its peak volume in the U.S. in 1920. By the 1930s rail travel had become faster and more comfortable Amtrak was founded in 1971 Passenger rail service is much more important outside of North America. Efficient, economical, high speed trains provide an alternative to air travel.

International Rail Service

Rail Service still very important in Europe and Asia
High-Speed Trains in Japan, France, Germany, Spain, China, South Korea, and Taiwan High-speed trains carry passengers between large population centers
France TGV 357 mile; Japan 361 mile

Often train travel is faster and cheaper than air travel Importance of Eurailpass to non-European international travelers Channel Tunnel allows travelers to travel between Europe and U.K. (opened in 1994).

31.5 mile

Highways and Byways

Development of national highway systems increased auto travel Automobiles
84% of all overnight weekend travel by U.S. residents is by auto Cost, convenience, flexibility and ability to explore U.S. and Canada have funded highways instead of rail track Growth in rental car market Better Vehicles

Automobile Rental
Rent A Car Services
Started by Joe Saunders in 1906, in Omaha His first customer was a traveling salesman who had a date with a local girl. By 1925 Saunders had car rental operations in 21 states After the World War II, the car rental industry grew rapidly, carried along by the expanding economy. Major car rental companies
Enterprise (27%) Avis Hertz (20%) Budget Alamo/National (16%)

Other Ground Transportation

Intercity bus passengers tend to be lower income nonbusiness travelers who are very price sensitive

Scheduled intercity travel and charter/group travel

New designs have increased comfort, services available and capacity Flexibility
Bus Tours Economical and comfortable

Other Ground Transportation

Recreational Vehicles
-Transport and accommodation combined -RV campgrounds provide hook-ups for water, electricity, and sewage.

Water Travel
Cruise Ships  A passenger ship used for pleasure voyages  Floating Resorts The voyage itself and the ship's amenities are part of the experience. Transportation and destination in one Become a major part of the tourism industry Fly-cruise packages

Cruise ship Destinations

Major Cruise Ships Destinations The Caribbean (50%) The Mexican Riviera (5%) Alaska (8%) S. Europe and Mediterranean (15%) N. Europe and Scandinavia (4%) Panama Canal (6%) South Pacific (2.2%)
Popular Departure Locations: Miami New York Port Canaveral Ft. Lauderdale Baltimore New Orleans

Cruise Industry
Fastest growing segment of the travel industry. Since 1980 the industry growth rate is 8.1 % In 2004; 230 cruise ships carried almost 10.6 million tourists More than 90% American tourists 11.4 % increase over 2003 Utilization is consistently over 90% Expanding fleets; 20 New ships will be added in 2008 Adding new ports of call. Served by the Cruise Lines International Association.

Cruise ship Destinations

Largest Cruise Ship Price Tag: $1.2 billion Completion Date: 2009 Total Length: 1180 feet Passengers: 6400

Soaring Through the Skies

Air travel is a 20th century mode of travel: jet travel only in second half of century Cooperative organizations make the industry more efficient Marketing muscle for frequent-flyer programs, pioneered by American Airlines Airlines operate on thin profit margins, so controlling costs and maximizing revenues is a major concern

Soaring Through the Skies

Operating in a deregulated environment
Airline travel was deregulated in U.S. in 1978 Changes due to deregulation
Competition on price Increase in number of airlines serving any city Airlines enter and leave airport service at will Airlines can package and market services

Regulation and Deregulation of Air Travel

Economic Aspects of Regulation
Airline business is a significant capital investment Regulation has often been used to protect that investment by limiting competition and preventing the market from adjusting prices. In 1978 United States deregulated the airline industry with the Airline Deregulation Act. Deregulation movement has gained momentum in other countries Deregulation gave freedom in setting air fares, creating discount air fares, and entering new routes. Yield management techniques used in pricing

Other Aspects of the Airline Industry

Computerized Reservation Systems (CRS)
CRSs such as Apollo, Sabre, Amadeus, and Galileo have had a dramatic impact on the industry. CRS increased speed, effectiveness and efficiency of airline reservations. Through the Internet, customers can search for the best fares and book reservations using CRSs.

Computerized Navigation and Traffic Control

Technological advances greatly improved the safety, and efficiency of air travel. The air traffic system includes satellites, ground radar, air traffic control centers, and the airplanes. Much of Europe ground control centers use a multitude of different operating systems.