FOR IMMEDIATE RELEASE: February 8, 1988 AIR SAFETY IMPROVED BUT DELAYS REMAIN A PROBLEM BECAUSE MORE PEOPLE FLYING, SAYS FTC STUDY ON DEREGULATION General Aviation Aircraft Cause of Many Near-Collisions and Delays Since deregulation of the airline industry, virtually all statistics show that air safety has dramatically improved, according to a Federal Trade Commission staff report released today. The study also points out that general aviation aircraft -- private planes -- are involved in the vast majority of near mid-air collisions and are significantly more hazardous than commercial aviation. Flight delays remain a problem, and a major cause may be subsidies to general aviation, the study said. The Bureau of Economics report looks at the effects of the Airline Deregulation Act of 1978. Before the Act passed, the Civil Aeronautics Board "set ticket prices, discouraged competition, and restricted entry." Full deregulation was accomplished by 1983, and "has indisputedly given us a very different air transport system" -- fares have dropped about 25 percent, travelers pay discount fares 90 percent of the time, and the number of departures is up 27 percent, the study says. "Deregulation has resulted in a large increase in the number of persons flying and the number of flights, so it is not surprising that there has been a concomitant increase in delays and other congestion-related problems," the study says. According to the study, the absolute number of accidents, fatal accidents, and fatalities on scheduled major airlines "declined substantially," and "the improvement in accident rates is even more dramatic." The improvement in safety may come from sources other than deregulation, such as improved technology, but the record "does not indicate that deregulation has had an adverse effect on the safety of air travel." The study also noted that deregulation did not remove any safety rules. The study notes that "near-mid-air-collisions" were up from 311 in 1982 to 839 in 1986, but 96 percent of these involved military or general aviation aircraft, neither of which was affected by deregulation. The higher recent numbers of reported near-collisions "are partially the result of a change in reporting methods." The number of near-collisions "could be substantially lessened by requiring general aviation to adopt safety rules similar to those governing commercial airlines," the report says. Although general aviation accounts for only a small share of the passengers served by most major airports, it is responsible "for a much larger share of total takeoffs and landings," according to the study. General aviation receives significant subsidies and may contribute to air traffic congestion. "General aviation is a powerful special interest group that imposes burdens on air travelers not fortunate enough to own their own airplanes," said FTC Chairman Daniel Oliver. (More) One solution to airport congestion and flight delays would be to make both general and commercial operators "bear the costs they impose on airports and the Air Traffic Control System." For example, a small private plane can land at Washington's National Airport during peak landing and takeoff periods for $4. "The total cost of landing and parking such an aircraft at National is $14, which is only slightly more than the $7 charge for parking a car overnight" in the long-term lot, the study notes. Such fees are less than the full cost of using the facilities during peak periods. The report suggests that airport operators could sell landing rights during congested periods at prices that reflect costs. An increase in these landing fees will deter some general aviation and other flights from using congested airports during peak times, reducing congestion by spreading flights more evenly during the day. Since deregulation, fares have fallen significantly, the study says. For example, in 1976, prior to deregulation, only 15 percent of travelers paid discount fares, while by 1987, 90 percent of travelers paid discount fares. In addition, flight frequency has increased. "The total number of passenger miles flown is up 65 percent since deregulation, from 183 billion in 1978 to 302 billion in 1986." "Given the clear benefits that the American public has received from the deregulation of passenger airlines, it is puzzling that deregulation is so controversial," the report says. "This does not mean that the public should be unconcerned about the statistics on near-collisions, delays, or service problems." But these problems could be solved on an individual basis, the study says. For example, "if the public demands improvements in some aspects of safety, then safety standards ... should be modified." The study is titled "The Deregulated Airline Industry: A Review of the Evidence," and was written by FTC economists Jonathan D. Ogur, Curtis Wagner, and Michael G. Vita. It reflects the views of the authors and is not intended to represent the position of the FTC or of any individual Commissioner. Copies of the report are available from the FTC's Public Reference Branch, Room 130, 6th St. and Pennsylvania Ave. N.W., Washington, D.C. 20580; 202-326-2222; TTY 202-326-2502. # # # MEDIA CONTACT: Susan Ticknor, Office of Public Affairs, 202-326-2181 STAFF CONTACT: David Scheffman, Bureau of Economics, 202-326-3430 (Dereg)