Next meeting: Feb 7th: 6:30pm, Wisconsin Energy Institute:
Question of the Week:
1) Can high speed rail make the airlines more profitable?
Engineering Expo Concepts
Airline White Paper
Blue Skies Competition/White Paper
Airport 2050: Why is air and ground separate?
Wheels on Steel:
Part 2 of 5: More opponents line up (Texas Central)
Part 3 of 5: The court pivots and accepts the case: (Texas Central)
Miami New Times
Urban Transport News
In the Tube:
Up in the Air:
The Points Guy
There has been no change since the last issue. The Build Back Better plan continues to be negotiated, but a vote in Congress is not currently scheduled
The Airport of 2050:
Part 2, Why the airlines need high speed rail
This whole semester, the group will be studying the airport of the future and what role high speed ground transportation will play. This is the second of a ten week project looking at all aspects of the airport from airline profitability, to sustainability, to national defense. So check back every week!
Decreasing airline costs: Moving from fixed costs to variable
Typically United, American, or Delta allocate flights under 500 miles to regional airlines such as Skywest, Republic, Mesa, or Endeavor. The planes wear the major carriers branding, but the crews and plane belong to the partner airline. The major airline then pays "power by hour", or a per departure fee to the partner airline for operating the flight (with sometimes a revenue share, but those are not as popular). In 2014, this was about $1500 to operate a 50 seat aircraft from Chicago O’Hare to Milwaukee flight (one way). The regional airline made $1500 no matter how many passengers were onboard while the major carrier set the passengers ticket prices and sold the seats. This meant that the major airlines took the risk of not filling all the seats, making that flight a fixed cost to the major airline (because it was $1500 no matter what).
However, operations of a high speed trains are funded by the railway operator. Since a high speed can carry 500-1000 passengers, the train could easily accommodate the 50 airline passengers for a major airline. So instead of paying for a flight the major airline can just "buy" a contracted seat from the railway. The train operator makes incremental revenue on a seat that would have gone empty and allows the airline to just pay for the seats it uses on the train. This effectively lowers the airlines costs to serve a route AND reduces financial risk to the airline by converting the costs from fixed costs (having to pay for the whole airplane) to variable cost (of just paying for the seats used).
In simple terms - the major airlines will not have to pay for empty seats
Therefore, an airline with the high speed rail partnership would likely be able to undercut the price of an airline still flying regional jets; all the while being more profitable.
Was the Hyperloop killed by Coal?
Back in 2013 all the world was amazed by Elon Musk’s white paper on a new transportation system that would whisk passengers faster than airplanes in vacuum tubes across America. The media went crazy over the idea and money flowed into new ventures who were going to build these epic machines. Meanwhile at universities across the world, students enthusiastically formed teams to compete in competitions for designing this new revolutionary transportation technology.
8 years later, it may have all come to an end. 2 weeks ago it was announced that all the executives at Virgin Hyperloop left the company and that Virgin Hyperloop was now focused only on freight. What Happened? After all, only 4 months ago we were seeing concepts of spacious pods racing across cities. Well...
Build Back Better is what happened....more importantly, the delay of it.
It is kind of shocking because back in 2020 Virgin Hyperloop announced that West Virginia would be the location of the new certification center. On hand with the celebration were Governor Justice.of West Virginia, and a familiar name…Senator Joe Manchin who advocated for the certification center.
Everything was a go, the only thing needed was more money. With hyperloop classified as railroad, and $10 billion for high speed rail being in the Build Back Better Plan, Virgin Hyperloop would have been set for its next round of financing. But, politics got in the way. Senator Joe Manchin announced on Fox News that he was killing the Build Back Better Plan, and along with it Virgin Hyperloop's plans and hopes were dashed.
With that announcement, not only did Senator Manchin kill the bill, but he also killed off whatever hope Virgin Hyperloop had of being a passenger carrying transportation technology. Instead Virgin Hyperloop is now in search of airports and ports to partner with…which is a whole other story.
Now there are other hyperloop companies out there, such as HTT, Transpod (Canada), Hardt (Netherlands), and Swisspod (Switzerland). However, it wouldn’t be a stretch to think that HTT would be facing the same financials pressures as Virgin Hyperloop. After all it was just 3 months ago the HTT was stating that it is going after the Infrastructure Bill funding just like Virgin Hyperloop. Maybe that will pan out, maybe not. Time will tell.
Meanwhile we will leave you with the vision of what could have been….A hyperloop testing center built in West Virginia on those same mountains once mined for coal and but unlikely to now see a hyperloop pass by.
Air & Rail: How a UW-Madison engineer & the railroads started America's first transcontinental airline
Back in the 1920's aviation was in its infancy. Former UW-Madison engineer, Charles Lindbergh, had just made the first non-stop flight across the Atlantic Ocean in 1927. Meanwhile air passengers were an afterthought to the airlines and had to frequently sit on mailbags if they wanted passage. This was because the money was in the mail. There were no true passengers airlines like we would know today as Delta Airlines was just beginning operations as a little crop dusting outfit, United was flying mail as Varney Airlines out of Boise, Idaho; and American Airlines was operating as "Colonial Air Transport" between Boston and New York... again just carrying mail.
However, there was an airline called "Transcontinental Air Transport (TAT)" that was trying to change things. Designed by Charles Lindbergh, this was the first airline to start coast to coast service from New York to Los Angeles.
Inaugurated on July 7th, 1929, passengers started off at New York Penn Station....yes, a railroad station. They then took Pennsylvania Railroad's "Airway Limited" to Columbus, Ohio; where the passengers boarded a Ford Trimotor for the day flight to Waynoka, Oklahoma. After 4 stops en route the plane and passengers arrived in Oklahoma to be met by the Santa Fe Railway's overnight train to Clovis, New Mexico. From Clovis, the passenger would then board another Ford Trimotor for the final leg to Los Angeles, making 3 more stops along the way.
The trip took over 48 hours and the service lost over $2.7 million in the first year of operation. However, it did help create the first transcontinental airline route in the United States and with better aircraft being designed in the 1930s the service eventually moved from the train to fully by air. That airline called TAT, was then renamed Transcontinental & Western Air in the 1930's, then became Trans World Airlines (or TWA for short) in the 1940s. TWA would eventually become on of the world's premier airlines in the second half of the 20th Century until it was merged with American Airlines in 2001.
So the moral of the story is that airlines and railroads have a history together. Throw in a few UW-Madison engineers and transportation can change forever.
Wisconsin Valley Video: https://youtu.be/CqadvEFN_ZI