A decline in the number of passengers boarding U.S. domestic flights will accelerate this year as the recession saps travel demand, the Federal Aviation Administration said.
The agency predicts a 7.8 percent drop for the fiscal year ending Sept. 30. That compares with a 1.5 percent drop in the same period a year earlier, the FAA said in its annual forecast today in Washington.
The outlook reflects deterioration in consumer and business spending that eroded economic growth and prompted airlines to cut capacity in last year’s second half. Economists have pared projections, with the U.S. economy now expected to contract this year by the most since 1946, based on the median estimate in a Bloomberg survey taken March 2 to March 9.
“The carriers have long anticipated that weak economic conditions would further reduce demand and they’ve cut their schedules accordingly,” said David Castelveter, a spokesman for the Washington-based Air Transport Association, an industry trade group.
The number of passengers on domestic flights will rise by an average of 2.7 percent a year from 2010 through 2025, the FAA said. Total boardings will reach 1 billion in 2021, five years later than the agency projected last year.
“The downturn facing aviation mirrors the economic situation around the world,” FAA Acting Administrator Lynne Osmus said in the report. “But we expect that as economic growth returns, so too will passengers and operations.”
The U.S. economy will shrink 2.5 percent this year, according to the Bloomberg survey median.
The number of travelers on U.S. airlines fell 12 percent in February compared with a year earlier, the Air Transport Association said earlier this month.
Capacity, or airline seats available for sale, will shrink about 9 percent to the lowest level since 2002, the FAA said.
The cutback in seating will mean fuller planes even with fewer people flying. The agency forecast a 79.4 percent load factor, compared with 79.3 percent last year and 70.6 percent in 2000, according to FAA data.