FAA sees 9 percent fewer air passengers this year

The Federal Aviation Administration predicts that nearly 9 percent fewer passengers will board major U.S. airlines for domestic flights this year, and that traffic on international flights will also decline as the bleak economy curbs business travel and vacation plans.

The FAA's 2009 projections, released in a report Tuesday, match airlines' grim outlook. The major carriers have been cutting capacity in the face of a travel slowdown blamed on the recession. But the agency sees the downturn lasting only through 2009, and forecasts that growth will resume next year.

The FAA expects domestic boardings on major U.S. airlines to fall 8.8 percent, and 2.4 percent internationally in 2009. Including smaller regional carriers, enplanements on U.S. routes are expected to drop 7.8 percent this year - a substantial decline compared with 2008's 1.5 percent year-over-year dip.

But the agency says that traffic will pick up again in 2010, with domestic boardings growing 2.3 percent a year to reach 690.2 million by 2025. International boardings on the big carriers and smaller regionals will grow 4.3 percent a year from 2010 through 2025.

The FAA forecast that total enplanements will hit 1.1 billion in 2025, up from 757.4 million last year.

The FAA based its forecasts on the assumption that the U.S. economy will grow 2.7 percent a year and worldwide economic growth will be 3 percent a year through 2025. The FAA assumed inflation will be modest, about 2 percent a year.

The FAA also expects that the general-aviation fleet will grow 1 percent a year, from 234,015 in 2008 to 275,230 aircraft in 2025. The agency, which runs the nation's air traffic control system, said it expects its workload to decrease 5.7 percent this year and then grow 1.5 percent a year through 2025.

Last year, U.S. passenger and cargo airlines reported operating losses of $2 billion, compared with an operating profit of $10.1 billion in 2007. Revenue rose 8.8 percent but costs grew 16.9 percent as fuel prices hit an all-time high in July before tumbling.

The number of passengers boarding U.S. flights, including regional carriers, dipped to 679.6 million from 690.1 million in 2007, though international boardings rose to 77.8 million from 75.3 million.

Revenue per mile flown by paying passengers, a key financial measurement, rose to all-time highs on major U.S. airlines, the FAA said. It climbed 5.2 percent on domestic flights and 7.4 percent on international flights after airlines pushed through several rounds of fare increases early in the year and added surcharges for fuel, luggage and amenities.