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Aviation History
1951
1951 - 1293.PDF
22 FLIGHT Commercial Aviation Commentary By ALLEN GALE No. 2 of a New Series ONE of the face-savers which we have grown accustomedto using in this country when explaining away theannual deficits of our national airlines is the argument that U.S. operators only enjoy the prosperity which they do because of the large sums paid to them by the Govern- ment for the carriage of the Post Office mail. I have yet to see an accurate evaluation of exactly how the American system of payment compares with our own, but it is admitted in the United States that their system contains a hidden subsidy. This is recognized by the fact that a Senate committee is currently in the closing stages of an investigation to determine how much of the mail payment can be regarded as fair reward for the carriage of the mail and how much is for other purposes. Without elaborating on the principles involved one can comment briefly that the American carriers receive mail pay on the basis of so much a ton-mile, the exact sum being determined by the C.A.B. in conjunction with the Post Office, and that this sum varies with the carrier, because the assessment is based on the sum of a number of variables connected with the operation of each individual airline, e.g. operating costs, overheads, etc. Other countries pay operators a lump sum that is not directly related to the amount of mail carried. In this country, payment is based on weight of mail carried, but the assessment of the rate is made with no reference to the operating costs of the airlines; it is, in fact, fixed in conjunction with the rates charged to the public for the carriage of their mail. TNTO this very contentious subject the news has nowA been injected that some of the domestic carriers in the U.S.A. are beginning to show substantial profits without taking any account of the mail payments. Figures for 1950 show that American Airlines, for instance, have turned in a profit of Si7,002,317 before adding mail payment amounting to another $5,915,510, whilst United Air Lines managed to make $6,876,407, excluding mail pay of $7,341,612. If nothing else, these figures show that there is plenty of money to be made in the airline business. Undoubtedly, as domestic carriers these airlines enjoy special privileges not accorded to such airlines as B.E.A., since their operation is mainly within the confines of their national boundaries and the competition which they have to cope with is at least controlled by the appropriate licensing board—if not, in some cases, eliminated altogether. For these reasons, and for others too involved for discussion here, their mail payments amount to only a very small percentage of their operating revenue, and in the case of the two airlines mentioned the respective figures are given as 5.16 and 7.67 per cent. For international carriers this percentage would be higher, thus increasing dependence on such payments for profit-making. As an example, B.O.A.C.'s mail pay in 1947 amounted to 29.5 per cent of its total revenue. There can be no question that a system similar to that at present used in America would do a certain amount towards pulling our airlines out of the red; but it would be by no means the complete panacea which it is often cracked up to be. The mail-pay figures for the big airlines in the States are impressive, but one must remember that not all of this is subsidy—and, furthermore, that our own airlines by no means carry the mail for nothing at this time. It is my feeling that we should cease holding on to such excuses as this mail-pay business; the argument there is noticeably thinning, especially since latest information suggests that the whole mail-pay structure in the U.S.A. is likely to be revised shortly. A FEW years ago someone had the sound idea of ^ establishing the post of civil air attache in some of our embassies. There was rejoicing in the airline industry when the news got around, because such a man, assuming he knew his stuff, could do an enormous amount of good. There was even more rejoicing when the appointment was announced of the ubiquitous Peter Masefield to the first post in Washington. It seemed as if officialdom had seen the light and the right men were going to get into the right jobs, even though not all the appointments met with universal approval. However, it was not to be expected that Mr. Masefield's exceptional knowledge of civil aviation could be matched and his high standard maintained in every case, and, in fact, the idea has not worked out as well as it might have done. Now rumour has it that most if not all of the present attaches are to be recalled and replaced by permanent civil servants. Thus does a good idea sink into oblivion. T'HE reopening of the New York to Bermuda service by1 B.O.A.C. will be welcomed by most people who are interested in British aviation. The closing down of this service in March, 1950, was never fully explained, and as a result one is left with no choice but to form one's own opinions. Certain it is that plenty of traffic existed on that route at the time of B.O.A.C.'s decision to curtail the service and exists today to an ever-increasing extent. By no stretch of the imagination can one call it an uneconomical route and more and more it is becoming less of a seasonal one. At the original beginning of this service, which goes back to several years before the war, there were only P.A.A. and Imperial Airways in competition with each other,; After the war other operators saw the possibilities of thfe route and entered the field. This inevitably diluted the traffic for the original carriers, but, on the other hand, it also coincided with a big drive by the Bermuda Government to step up tourist traffic. As a result of this official effort, latest figures show that Bermuda holiday traffic from the United States broke all records during the past year. It seems a pity that for this very profitable period B.O.A.C. were not operating the route. One sympathizes with a company when it finds itself forced to curtail a service because of poor passenger support, but in this case it would seem that the route was clearly not lacking in load potential, so perhaps one's sympathies are not warranted. Assuming that the service was suspended because of insufficient loads, one might say that this was suspiciously like running away in the face of the enemy and would seem to run counter to our best traditions. What is equally upsetting- is that at least one independent operator in this country who saw an opportunity of keeping the flag flying (and at the same time making some money) was given no support for his stheme and was greeted with considerable opposition from all concerned. Why this was the case is difficult to imagine, since such a service—provided it was run properly, and in this particular instance there was every reason to suppose that it would be—would have had a big support from the Bermuda Government, if only because it was British. Thus a year and more went by and- the other operators profited by our defection. It is to be hoped that the present service, which is to be thrice weekly to start with, presumably on the grounds of 1 aircraft shortage, will soon be stepped up to a daily rate— as, in fact, it was when it closed down; and also (if it is not too much to expect) that a more up-to-date aircraft from the passenger's point of view than the old 049s will eventually find its way on to this route.
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