1 FAA Aviation Forecasts Fiscal Years Presented at the 30 th Annual FAA Aviation Forecast Conference By Robert L. Bowles Manager, Statistics and Forecasts, FAA March 17, 2005

2 : : Domestic Passengers Up 6.7% in Passenger Level Down 2.2 % from 2000

3 : : International Passengers Up 11.7% in Passenger Level Down 4.7 % from 2000

4 : : Domestic Yield Down 18.3% Since Yield Level

5 : : Low Cost & Regional Carriers Increase Market Share

6 : : Air Cargo Revenue Ton Miles Up Almost 5% in RTM Level

7 : : Commercial Air Carriers Have Lost $25 Billion Since 2000

8 : : General Aviation Hours Flown Have Bottomed Out 2000 Hours Flown Level Down 9 % from 2000

9 : : FAA/Contract Tower Instrument Operations Up 2% in Instrument Operations Level Down 7.2 % From 2000

10 : : Recovery In Activity Not Uniform Among All Airports  LAS  SLC  DEN  SAN  MSP  ORD  MDW  DTW  IAH  CVG  FLL  LGA  MEM  ATL  CLT  DCA  PHL In 2004 Commercial Operations at 17 of 35 Major U.S.Airports Already At 2000 Levels

11 : : U.S. Economy Grows An Average Of 3.2% Annually

12 : : World Economy Grows An Average Of 3.2% Annually $34,821 $37,142 $38,338 $50,825 $35,981

13 : : Energy Prices Spike in 2005 Then Fall Over Next 3 Years All Signs Point to Continued Recovery

14 : : Domestic Real Yield Falls An Average Of 1.7% Annually

15 : : Domestic Passengers Return to Pre 9/11 Levels in 2005

16 : : International Passengers Return to Pre 9/11 Levels in 2005

17  Latin America  Pacific  Canadian Transborder  Atlantic : : Every World Travel Region Returns to 2000 Levels by 2006

18 : : Total Passengers Exceed One Billion In 2015

19 : : By 2016 Low Cost and Regional Carrier Domestic Share ≈ 55% Passenger Market Share Low Cost & Regionals/ Commuters Low Cost & Regionals/ Commuters Large Network Carriers Large Network Carriers % ≈ 55%

20 : : Regional Jet Fleet Grows 38% Over Next Three Years

21 : : Low Cost Carriers Drive Mainline Carrier Fleet Growth

22 : : Cargo Revenue Ton Miles Increase 82% By 2016

23 : : General Aviation Hours Flown Up 20% By 2016

24 : : By 2016 Instrument Operations Up 29% At FAA/Contract Towers

25 : : Eight Additional Airports Exceed 2000 Levels by 2006  LAS  SLC  DEN  SAN  MSP  ORD  MDW  DTW  IAH  CVG  FLL  LGA  MEM  ATL  CLT  DCA  PHL  HNL  IAD  BWI  MCO TPA   JFK  PHX  EWR Commercial Operations at 25 Large U.S.Airports Will Exceed 2000 Levels By 2006

26 : : Implications For The FAA  Congestion On Rise As Demand Returns  Several Airports Already Experiencing Delays  Change in Aircraft Mix Makes Future Workload More Complex  Rapid Growth in RJs  Strong Growth in GA Business Jets  Falling Yields Pose Risk To Matching FAA Funding Needs With Demand For FAA Services

27 : : Forecast Risks  Deteriorating Financial Condition Of Legacy Carriers  Sustained Higher Fuel Prices  Increasing Delays At U.S. Airports

28 : : Forecast Summary  Recovery of Traffic Continues In 2005 And Beyond  Commercial Carrier and Domestic Passengers Return To Pre 9/11 Levels  Commercial Carrier Passengers Exceed One Billion in 2015  Low Cost Carriers Increase Share => Falling Fares  Rising Demand For FAA Services  Downside Risks Are Significant