DON HONORIO VENTURA STATE UNIVERSITY

Bacolor, Pampanga
“Opening Minds, Progressing Technologies, Creating Bright Futures”
College of Hospitality and Tourism Management

CHAPTER IV
TRANSPORTATION SECTOR
Transportation and Travel Evolution

 A review of the history of transportation and travel shows that their evolution took seven eras:

Pre-Industrial Travel System Era

 A period before the widespread industrialization Europe and North America.
 It was before the development of railways in the two continents.
 There were almost no regularly scheduled transportation services and there were only few common
carriers and the result was little travel.
 Travelers made their own arrangements with several suppliers.
 It is the era of the stagecoach and the wayside inn and only few people had the money and the
reason to travel.

Early-Industrial Travel System Era

 During the era, road improvements such as railways, canals and steamship services were brought
about due to rapid industrialization and advances in transportation technology.
 Common carriers came into existence and began to offer regularly scheduled transportation
services.
 Travel increased because more people who had money traveled.

Mature-Railway System Era

 This era was characterized by railways which expanded their operations by running hotels and
providing other travel-related services.
 The railways began to market their services more aggressively.
 Travel agencies and tour companies were formed.
 Thomas Cook, an innovator in the field of travel agency during this era, began his company’s
activities in the United Kingdom in 1840.
 More people traveled in this era than in the previous one.

Express-Travel System Era

 Express service increased in this era.
 Trains and other forms of transportation did not stop at every station or terminal but only at the
major ones. This increased the speed of travel and encouraged more travel than before.

Automobile-Based Travel System Era

 This influenced of the privately owned automobile was enhanced in North America and Europe from
the 1920s onward and give way for the booming car ownership in North America.
 Motorways, interstate highways, and other trunk highways were developed in the latter half of this
era which was from 1920 to 1974.
 The automobile was predominant over other travel modes from 1920 to 1945.

Modern-Tourism Travel System Era

 The period from 1945 to 1974 is known as the modern-tourism travel system era.
 Car ownership continued to grow at a fast rate, mainly at the expense of long-distance rail travel.
 Mass air travel was another post-World War II occurrence.
 The introduction of wide-bodied jets in 1970 greatly increased air travel.
 The “mass tourism” philosophy and marketing approached were prevalent during the 1950s and
1960s.
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Vision – A lead university in producing quality individuals with competent Mission – DHVSU commits itself to provide an environment conducive to
capacities to generate knowledge and technology and enhance continuous creation of knowledge and technology towards the transformation
professional practices for sustainable national and global competitiveness of students into globally competitive professionals through the synergy of
through continuous innovations. appropriate teaching, research, service and productivity functions.
 Post-Mobility Adjustment Era
 This era began in 1973 to 1974 as a result of the oil embargo generated by the Organization of
Petroleum Exporting Countries (OPEC) and the resulting increase in fuel prices.
 The event of the energy crisis basically changed the travel patterns throughout the world.
 The present era is one in which travelers continue to look to alternative, group-oriented modes of
transportation.

Historical Development of the Transport System

 The desire to travel is stimulated with the improvement in transportation.
 Before World War I, it took seven days for travelers to go from coast to coast by steam locomotive.
 By 1950, travelers could complete the journey in two and a half days by train.
 In 1938, an airplane with the speed of 400 miles an hour made possible nonstop coast-to-coast flights
of less than eight hours. In 1950, travel time from coast to coast was lessened to four hours.
 At present, the Concorde can make a flight in two and a half hours.

Speed
Year Mode of Transport
(miles per hour)
6000 BC Caramel caravan 8
1600 BC Chariot 20
AD 1784 First English mail coach 10
1825 First steam locomotive 13
1890 Improved steam locomotive 100
Land speed record
1931
(Bluebird: Sir Malcolm Campbell)
Land speed record
1938 350
(Napier-Railton car: Job Cobb)
1938 Piston Aircraft 400
United States Liner from New
1952 41
York to Le Harve
1958 Jet fighter aircraft 1,300
1958 Boeing 707 and DC-8 aircraft 600
1961 Spaceship (Vostok 1 orbiting) 17,560
1967 Rocket plane 4,534
1970 Fighting bomber (Mirage IV) 1,450
1970 Commercial aircraft: Concorde 1,320
1970 Boeing 747 626

Table 2. Historical Development of the Transport System

Source: Reason, James. Man in Motion: The Psychology of Travel. London: George Weindenfield and
Nicolson Limited, 1996.

 The development in transportation has made the world a smaller place.

 It is now possible to take one to two weeks of vacation in distant places like Europe, the United States,
the Carribean, Mexico, and South America.
 Now, travelers can go to any place in the world due to fast and efficient means of transportation.

Selection of Transportation Mode

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Vision – A lead university in producing quality individuals with competent Mission – DHVSU commits itself to provide an environment conducive to
capacities to generate knowledge and technology and enhance continuous creation of knowledge and technology towards the transformation
professional practices for sustainable national and global competitiveness of students into globally competitive professionals through the synergy of
through continuous innovations. appropriate teaching, research, service and productivity functions.
  There are many reasons why people select one transportation mode over another for their business
and pleasure trips.
 The most common reasons are cost, traveling time, safety, convenience, comfort, availability,
frequency of trips, ground services, terminal facilities and location, status and prestige, and departure
and arrival times.
 People belonging to different travel segments have different value perceptions.
Example: the time spent in travelling as well as departure and arrival times are very important to the
business traveler while the cost of the trip is the traveler’s primary consideration.

 Jagdish Sheth developed a theory identifying transportation variables ad the value of travelers.
 He found out that travelers choose a travel mode based on how they psychologically weigh the five
factors, namely: functional, aesthetic/emotional, social/organizational, situational, and curiosity.
a) The functional utility of a mode is its expected performance for a specific purpose.
Examples: departure and arrival times, safety record, the directness of the trip, and the number
of stops or transfers.
b) Aesthetic/emotional is related to such aspects as fear, social concerns, style, luxury, comfort,
and other personal feelings that the form of transportation might evoke.
c) Social/organizational shows that the frequent users of certain kinds of transportation are
stereotyped according to sex, racial origin, income, price/cost, and education.
d) Example: those who take bus trips are usually perceived to be female, either young or old, while
those who take bus tours are cruises are generally retired people.
e) Situational refers to how conveniently locate the particular mode of transportation and its
terminal facilities are for the traveler.
f) Curiosity utility refers to the traveler’s perceived need to do something new and different.
Example: transatlantic on Concorde may have a high curiosity value for many business
travelers.

Travel by Train
 Trains stimulated travel within the United States, Canada, and Europe in the 19th and early 20th
centuries.
 Britain had its first organized train tour in 1841, when Thomas Cook organized an excursion between
Leicester and Loughborough.
 The train was instrumental in stimulating the development of many seaside resorts in Britain.
 The first transcontinental route in the United States was completed in 1869. With the advent of the
steam locomotive in 1825 until after World War II, travel by train became the primary means of
movement within the United States.
 The dependence on the train is shown in the development of Las Vegas where large hotels were
located downtown, a short distance from the railroad station.
 This gave tourists who arrived by train quick and easy access to hotels and casinos.
 In 1863, long-distance rail travel boosted when George M. Pullman built the Pullman coach, luxury first-
class sleeping and dining facility.
 In 1868, the diner car was introduced on the Chicago and Alton line. Ten years later, an elaborate meal
could be obtained in all trains.

 The popularity of the train lasted only for a brief period after World War II when the automobile began to
gain more popularity to gain more popularity as a passenger transportation mode.
 By 1950, with the rapid growth of private automobile ownership and usage, passenger traffic declined
to 46%.
 In an effort to save the railroad industry, the Rail Passenger Service Act became a law in October 1970.
 The act created the National Railroad Passenger Corporation, now commonly known as Amtrak, which
began its operations in May 1971 and was intended to be a profit-making corporation.
 Canada’s equivalent of Amtrak is VIA Rail Canada, which was created in 1977.

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Vision – A lead university in producing quality individuals with competent Mission – DHVSU commits itself to provide an environment conducive to
capacities to generate knowledge and technology and enhance continuous creation of knowledge and technology towards the transformation
professional practices for sustainable national and global competitiveness of students into globally competitive professionals through the synergy of
through continuous innovations. appropriate teaching, research, service and productivity functions.
  Both Amtrak and VIA Rail have the national responsibility of providing intercity passenger rail
transportation and they are successful in increasing passenger volumes by improving the equipment
and services they offer and by promoting the benefits of traveling by train more effectively.
 Four evident factors why travelers select the train as a transportation mode: cost/price, comfort, safety
and the ability to see the area where the train is passing.
 VIA Rail’s onboard surveys of business travelers have identified user cost, convenience, travel time,
and comfort as of primary importance.
 A survey of Amtrak passengers showed that travelers favored the train for the following reasons:
1. Safety
2. Ability to look out of the train and see the interesting things en route
3. Ability to get up and walk around
4. Arriving at the destination rested and relaxed
5. Personal comfort
 The negative factors of rail travelers are slowness in reaching the destination, inflexible departure times
and lack of quality in food services.
 Promotions by Amtrak and VIA Rail have emphasized the rest and relaxation benefits of taking the train
and also pointed out the downtown-to-downtown routing of trains saves the time of the passengers.

 Train travel has continued in Europe and Asia more than in the United States, particularly for long-
distance travel.
 The Euro City network, formerly the Trans Europe Express (TEE) network, as well as other national
lines provided excellent rail services between major cities in 10 countries.
 In 1987, the TEE had been replaced by a new system which includes high-speed trains, with both first
and second class accommodations.
 The development and construction of Eurotunnel between England and the continent create the single
biggest unified rail network in the world and reduce travel time between England and other European
countries by two hours.

 Although the importance of rail travel was reduced due to the popularity of the automobile and airplane
in many countries, railroads has been working hard to improve their facilities to accommodate super
trains with speeds between 150 to 200 miles per hour.
 The first sensational rail accomplishment after World War II was Japan’s shinkansen or bullet trains
which travels at speeds greater than 140 miles per hour.
 The bullet trains run north and south and link major metropolitan areas and began its operations in
1964 in time for the Olympics in Japan.
Features:
 They make the run of 550 miles in three hours and 10 minutes from the former time of 18 hours.
 They provide a smooth ride that a passenger can leave a cup of tea or coffee on a windowsill
and not a drop will spill.
 A computerized control center feeds information to a lighted board that shows the location of
every train and the conditions of the track, switches and wires.
 Station stops are as short as two minutes at intermediate stations, so travelers must be ready to
move fast.
 The computer automatically stops the train in case of trouble especially during an earthquake.
 At present, Japan has the best railroad system in the world, with 26,000 fast and efficient trains
scheduled a day.
 The Japanese rail is heavily subsidized by the government and plans for trains which travel at a speed
of 300 miles per hour.
 France has its own super train, the Tres Grande Vitesse which travels at a speed of 175 miles per hour
between Paris and Lyons and Marseilles.
 In Russia, the Trans-Siberian Railroad, the longest in the world (5, 787 miles) links outlying Siberian
industrial regions and mining centers in European Russia. Railroads are important to the Russian
economy. The Germans have a test track designed to carry passengers at a speed of 130 to 240 miles.

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Vision – A lead university in producing quality individuals with competent Mission – DHVSU commits itself to provide an environment conducive to
capacities to generate knowledge and technology and enhance continuous creation of knowledge and technology towards the transformation
professional practices for sustainable national and global competitiveness of students into globally competitive professionals through the synergy of
through continuous innovations. appropriate teaching, research, service and productivity functions.
 Tres Grande Vitesse
 In 1939, a number of European countries introduced the Eurailpass which allowed a traveler to use it
for two months of unlimited second-class travel on any of the rail systems of the European countries.
 Later, it included unlimited first-class service over different periods varying from 15 days, 21 days, one
month, and three months with access to many ferries and steamer routes.
 They also introduce the student Eurailpass for a second-class travel and it is less than expensive than
the Eurailpass and is good only in 16 countries.

Travel by Ship
 In the middle of 19th century, travel by ocean liners or by ship began to become prominent preceded by
travel by train.
 Ocean liners were used to provide an important link to passengers among continents.
 At present, water transport has two major roles in travel and tourism- ferrying and cruising.

 The steamship era began in 1840 when Sir Samuel Cunard pioneered the first transatlantic-scheduled
liner tips. However, the introduction of the jet aircraft led to the rapid decline in the ships as scheduled
passenger transportation mode.
 In the late 1990s, the era of travel by ships expired, many passenger ships were converted into cruise
ships that took place of regularly scheduled passenger ships.
 Those that were too old or too large were junked or scrapped and others that had historical value were
converted into tourist attractions.
Example: the Queen Mary which is permanently docked in Long Beach, California became a tourist
attraction and a hotel.
 Cruises are more of a vacation experience than a transportation mode.
 Cruises are divided into three types depending on the duration of the trips: short cruises are one week
or less, intermediate long cruises last one to four weeks, and long cruises go around the world and take
one to three months.

Cruise Ship
 Short-duration cruises are more popular because they require less vacation time and are less
expensive.
 Other reasons are travelers can satisfy their desire to experience new environments and see new
cultures and still bring with them the comfort, safety, and convenience of home.
 In addition, there is no changing of hotels, airports, and food and beds which may cause sleeplessness
and other problems.
Examples of short cruises: the three-night cruises from Los Angeles to Mexico and cruises on the St.
Lawrence River on vessels such as the Canadian Empress.

 Cruise ships may be divided into large vessels which can accommodate 180 or more passengers and
small vessels or what they call “mini-cruises” or “ultra-yachts” which carry less than 100 passengers.
 Recently, the typical ship was built to carry 850 to 1, 250 passengers but now; the average capacity of
a new ship is 2,000 passengers.
 The large cruise ships offer a wide array of services and amenities to guests, most of which are packed
into the cruise.
 Accommodations on board vary from rooms for three to four persons to lavish staterooms, where in all
the rooms are air-conditioned and have private baths.

 A cruise ship is both a floating hotel and resort because the guests are housed, fed, and entertained.
 Food is offered throughout the day from seven-course meals to themed-event dinners.
 Cruise ships also provide almost continuous entertainment which include charm classes, language
lessons, dance classes, bridge, table tennis, aerobics, jogging and shuffleboard.
 Many ships now have fully-equipped gyms, health spas, and an athletic counselor.

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Vision – A lead university in producing quality individuals with competent Mission – DHVSU commits itself to provide an environment conducive to
capacities to generate knowledge and technology and enhance continuous creation of knowledge and technology towards the transformation
professional practices for sustainable national and global competitiveness of students into globally competitive professionals through the synergy of
through continuous innovations. appropriate teaching, research, service and productivity functions.
  Cruise directors plan activities and entertainment for the passengers which be full-scale musical
productions, live entertainment with well-known performers, discos, bingo, gambling, courses in self-
improvement, and the like.
 For many passengers, the numerous opportunities to socialize on a cruise are one of its major
attractions.
 Passengers who prefer a less active type of vacation can relax by the pool or on deck and enjoy the
warm climate and beautiful sunsets.
 Cruise enthusiasts prefer this type of vacation because it combines fresh air, plenty of good food, a
variety of activities, and visits to exotic places.

 Cruises are promoted and sold on the basis of health, recreation, and pleasure.
 Theme cruises are popular such as culinary cruises, historic voyages to less-known places, stock
market seminars, movie festivals, music festivals, music festivals, as well as cruises devoted to art,
golf, astrology, tennis, photography, and beauty counseling.

 The United States dominates the international cruise market by supplying more than 70% of total
passengers followed by Europe with 17%.
 Cruise lines have also lucrative/profitable market in the United Kingdom, West Germany, and Australia.
 In Europe, Russian ships offer lower rates and good services.

 The cruise industry is largely owned by European companies.

 Although, the cruise ship industry is not a US industry in terms of ownership, several United States and
American territory cities serve as major ports of cruise ships.

 The Caribbean is the world’s largest destination cruise passengers for destinations within the
Caribbean comprise 50% of total visitor arrivals.
 Other cruise destinations include the Mediterranean, Scandinavia, Alaska, and the Pacific.
 Cruises are announced several months before the departure and are also sold mostly by travel agents
as packages.
 The fly cruise package has grown popularity because it combines the speed and efficiency of jet travel
with the relaxing, romantic attribute of cruise ships.
 One significant marketing strategy used by the cruise industry is to offer heavily discounted or free air
flights to the port of embarkation and sometimes includes some cruise line agents greet passengers at
the airport and then transport them to the ship’s pier.
 In order to attract more families, other cruise lines have begun to provide children’s activities and offer
lower rates for a third or fourth passenger in a cabin.
 Several cruise lines have also designed cruise packages which cater to the single segment and those
interested in health and fitness.

 Young people prefer the three to seven day cruises.

 Older people take cruise of seven days or less.
 The elderly usually join the round-the-world cruise.
 Cruise passengers tend to be repeat customers.

 Another role of the ship travel and tourism is ferrying or the use of ferry boats.
 Short-duration sightseeing cruise ship attractions are abundant in North America that last for one day or
even a shorter length of time.
 The appeals of steamer sightseeing cruise are seeing the scenic beauty of the area, learning about the
history of the surrounding area, and using it’s dining/bar service.

 Market research shows that there are 24 million potential passengers with sufficient time and money.
 Satisfaction level is high for cruise passengers which would result in a high percentage of repeat cruise
goers.
 Foreign markets should also be seen as big potential markets.
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Vision – A lead university in producing quality individuals with competent Mission – DHVSU commits itself to provide an environment conducive to
capacities to generate knowledge and technology and enhance continuous creation of knowledge and technology towards the transformation
professional practices for sustainable national and global competitiveness of students into globally competitive professionals through the synergy of
through continuous innovations. appropriate teaching, research, service and productivity functions.
  Overcapacity is the major problem for the industry at present but the growing incentive-travel cruise
market is expected to help overcome the effects of overcapacity.

Travel by Automobile
 The real inventor of the automobile was Carl Benz of Mannheim, Germany.
 In 1885 to 1886, he combined the bicycle and the international combustion engine and designed the
complete vehicle engine consisting of the engine, chassis, and transmission.
 Henry Ford in 1908 produces his Model T car built with an assembly technique for mass production.
 The automobile industry grew rapidly and increased its popularity significantly after the World War II.

 The introduction of the automobile brought about the decline of the train’s popularity in most developed
countries.
 The advent of the automobile spread the benefits of tourism more widely and enabled people to travel
individually or in private smaller groups.
 The automobile brought about a more random pattern of travel movements, opened up new
destinations, and hastened the development of elaborate networks of automobile-oriented facilities and
services along highways and roads.

 Traveling by automobile is now the chief travel mode in North America.

 Many travel surveys have shown that automobile trips comprise 90% or more of the pleasure/personal
and business trips of Canadians and Americans.
 Surveys show that the automobile is the most popular mode of vacation travel because it provides
travelers greater freedom in the choice of route, destination, and timing of the journey.
 Family auto travel is also the most inexpensive and convenient form of travel in the United States.

 The growth of car ownership necessitated road improvements.

 The United States federal government participated in the construction and maintenance of roads when
it passed an act in 1916, matching state appropriations for new roads, dollar to dollar.
 It was climaxed by the interstate act in 1949 which allowed travelers to move coast to coast and border
to border without a traffic light or stop sign.
 The first turnpike was built in Pennsylvania in 1940.
 In 1954, the federal government, in order to encourage road construction, increased its share of the
highway construction to 90%.
 During, 1930s, the Germans constructed their network of autobahn.
 The four-lane divided highways were the world’s first high-speed roads.

 The automobile stimulated tourism by creating attractions along tourist routes made accessible by the
automobile.

 Two important aspects of automobile travel are recreational vehicles and car rentals.
 These two areas have developed so extensively that they are now significant elements of tourism.
 The recreation vehicle or RV was an extension of the preference of North America for the automobile.
 Ownership of recreation vehicles has increased since 1979.

 Since World War II, camping has become popular.

 The increasing popularity of the recreational vehicle led to the establishment of new campgrounds
during the 1970s, including the franchised condominium and time sharing condominium campgrounds.
 Many European visitors to Canada and United States rented these vehicles for cross-continent trips.
 Many companies been formed to provide this service to overseas pleasure travelers.

 Related to the growth of the automobile has been the growth of the car rental market in the 1960s and
1970s.

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Vision – A lead university in producing quality individuals with competent Mission – DHVSU commits itself to provide an environment conducive to
capacities to generate knowledge and technology and enhance continuous creation of knowledge and technology towards the transformation
professional practices for sustainable national and global competitiveness of students into globally competitive professionals through the synergy of
through continuous innovations. appropriate teaching, research, service and productivity functions.
  The car rental industry began in 1918 when a Chicago Ford dealer started to rent secondhand model
Ts.
 In 1924, the company was bought by John D. Hertz, the founder of the Yellow Cab Company.
 Avis who specialized in airport rental locations, the biggest competitor of Hertz, was founded in 1946 by
a retired US Air Force officer, Warren E. Avis.
 In 1948, Avis started downtown rental locations and it was during the same period that National Car
Rental was organized.
 By the late 1950s, car rental companies were found in all major airports.

 The car rental business is a worldwide industry.

 Four companies (Hertz, Avis, Budget and National) dominate the US market with 85% market share
and they represent the “Big 4” within the international markets.
 Another group of car rental companies consists of firms that rent used cars at lower prices.
 The car rental industry over the past 20 years is highly competitive.
 Individual companies claim to be the first in various innovations such as rent-it-here, leave-it-here
service.
 Each company, through its advertising, claims to be the first or the best in providing new service.

 The growth of the industry in the late 1960s and early 1970s can be attributed to the introduction of the
fly/drive concept.
 It encouraged travelers not to drive their personal car to their destination but to travel by plane and rent
a car on arrival.
 The highest utilization of rental cars takes place on Mondays to Fridays usually by business travelers
which comprise about 75% of the total business.
 The demand for weekends comes mainly from pleasure travelers.
 A high percentage of car rentals take place at airport terminals, it is understandable that the success of
this business is closely related to the airline industry.

 Some car rental firms gave added cellular car telephones for business travelers.
 Another amenity is giving computerized driving instructions to customers.
 In order to overcome low profits or losses, auto rental companies have employed a number of different
strategies such as higher prices, flat-free commissions for travel agents, and mileage limitations.

Travel by Bus/Motor Coach

 Bus travel is the most flexible and economical form of transportation.
 In the United States, buses were first used to carry passengers intercity in the early 1900s.
 There was a little intercity travel before the 1920s.
 In 1928, the Greyhound Company, the largest privately-owned bus company in the world, was
established.
 With road improvements before World War II, cross-country trip time was reduced to 90 hours.

 The terms “bus,” “coach,” and “motor coach” is used interchangeably.

 Two major roles of the bus: the first is to provide a regular schedule of intercity passenger
transportation services and the second is to provide charter and tour services.
 Intercity service is indirectly competitive with private auto, rail, and air service.
 Intercity bus service has declined, while charter and tour services have grown.
 Bus ridership patters also changed to short-haul distances of 250 miles or less.
 Continental Trailways, and Greyhound Lines Inc. are the two major intercity companies, with
Greyhound accounting for 60% of the market.

 The main reasons for selecting bus travel over other modes of travel are convenience and economy.
 Few people choose the bus for business travel.
 Bus riders tend to be older and have less income.

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Vision – A lead university in producing quality individuals with competent Mission – DHVSU commits itself to provide an environment conducive to
capacities to generate knowledge and technology and enhance continuous creation of knowledge and technology towards the transformation
professional practices for sustainable national and global competitiveness of students into globally competitive professionals through the synergy of
through continuous innovations. appropriate teaching, research, service and productivity functions.
  Bus service is available in practically every town and a passenger station or ticket agent for bus service
is at hand in each of these communities.
 Most people do not choose bus travel for long trips.
 Surveys have shown that women bus riders outnumber men.
 Recent advertising indicates that bus companies are targeting their marketing programs toward the
family summer vacation market, young couples, older people on summer vacation, and the retired
people.

 Charter and tour service is the fastest growing segment of the bus or motor coach industry.

 Several tour packages are developed by tour brokers who charter buses and arrange all the other
components of the tour, including the itinerary, lodging, sightseeing, admission, tour guides, meals and
the like.
 These packages are usually sold through travel agents.

 Motor coach tours usually last five to six days and is limited to a particular geographical area.
 The two principal markets for charter and tour services are school-age children and senior citizens.
 Other markets include international visitors.
 Gambling tours by motor coach to the casino centers of Las Vegas, Reno and Atlantic City are very
popular.

 The increasing demand for motor coach tours, coupled with the improvement of buses, could result in
the future expansion of the bus charter and tour segment of tourism.
 The present coaches are wider, have more leg room, more baggage space, lavatories, climate and
noise controls, better lighting, more sophisticated public address system, and panoramic view windows.

Travel by Air
 The airplane had a revolutionary impact on tourism from World War II onward.
 The history of air transportation can be divided into three parts – Pre-World War II, World War II, and
Post-World War II.
 On December 17, 1903, the Wright Brothers took a flight on a beach in North Carolina which lasted 12
seconds with a distance of 120 feet.
 In 1927, the air industry developed regularly scheduled passenger trips between Boston and New York.
 Other governments helped this growth in the 1920s by subsidizing air companies.

 In the United States, almost all early airlines started by carrying mail for the post office.
 One of the first was Varney which began in April 1926 and later became United Airlines.
 Western Airlines began its passenger service on April 17, 1926 when it carried a woman passenger
along with the mail.
 Pan American Airways had the first international flight in 1927 when it carried mail from Key West,
Florida to Havana, Cuba.

 The tremendous time-saving aspects of air travel and its cost effectiveness, when compared to other
modes of transportation such as the train, ship, and automobile, aided the growth of the airline industry
during the post-World War II years.
 In the late 1950s and early 1960s, commercial jet aircrafts were introduced, increasing the speed of
travel and creating smoother flights and greater seating capacity for passengers.
 The commercial airline industry improved further in the 1970s with the introduction of wide-bodied
aircrafts such as the Doughlas DC-10, Boeing 747, the Lockheed Tristar 1011, and the European
Aerobus and these planes further increased passenger comfort as well as seating and freight capacity.

 As the airline industry grew, the travel industry depended on it more.

 Cruise lines, rental car companies, airport hotels and ground transportation operators depended on the
airline industry to generate the bulk of the business.
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Vision – A lead university in producing quality individuals with competent Mission – DHVSU commits itself to provide an environment conducive to
capacities to generate knowledge and technology and enhance continuous creation of knowledge and technology towards the transformation
professional practices for sustainable national and global competitiveness of students into globally competitive professionals through the synergy of
through continuous innovations. appropriate teaching, research, service and productivity functions.
  Executive business travel and international tourism are dependent on it.
 The impetus of air travel to people traveling on business is its time-saving advantage; for the pleasure
traveler, it is the affordable price that has the greatest impact.

 The 1980s had witnessed still further improvements in aircraft technology with the introduction of the
DC-9-80 and Boeing 757 and 767 designed for fuel-efficient operation offering approximately 30%
lower fuel consumption for passenger than the older models.
 The introduction of the longer range Boeing 747-400 that has a range of 8000 miles and seating
capacity of 418 will change travel patterns.
 Almost all jetliners were built by Boeing, Lockheed and the A-300, the Airbus; the three American
Companies produced about 75% of the world’s commercial jet planes.
 Boeing was the dominant company in jetliner business.

 The Boeing 747 jumbo jet is a long-haul plane.

 The tail stands 63 feet and 5 inches tall, about as high as a five-story building.
 It weighs 775, 000 pounds and cruises at 625 miles per hour, with some models having a range of
6,210 miles without refueling.
 It is distinguished by the hump on the nose that houses the flight crew and an upper lounge for the first-
class passengers.
 Each 747 costs approximately $90 million, depending on spare parts and extras ordered.
 It is safer and gives a smoother ride because its huge size lessens its reaction to air turbulence and it
carries cargo in its belly.

 Food service on the large planes is speeded by the use of modules, similar to cargo modules and is
snapped into place on a lower level in the aircraft.
 The galley modules contain prepared foods that are heated in flight by convection and microwave
ovens located near the module storage area.
 Elevators raise the food to the passenger deck when it is ready.

 The factors associated with the recent boom in air travel include the world economy, rising standard of
living, and the quality of air service.
 Growth in the airlines has been at annual rates of 5% since 1959.
 The industrial nations, which account for the majority of air travel, had a growth rate of 7% from 1960 to
1970.
 The standard living in the world increased by 5% and the per capita income rose to 3%.
 The per capita constant dollar gross domestic product (GDP) of industrial countries increased faster
than the GDP of developing countries.
 Airfares throughout the world decreased to 9% between to 1960 to 1970.
 The average airfare in constant dollars decreased at an average of 26% a year from 1960 to 1970 and
continues to decrease and because of these factors, air travel is no longer considered a luxury but a
necessity.

 The introduction of charter services further pushed down the prices of airfares.
 Charter services are an alternative to regularly scheduled services.
 They offer lower rates for two reasons: first, they do not have the large personnel investment required
an airline with regularly scheduled flights and second, by flying with full load of passengers, the charter
companies are able to fly their planes for less cost per passenger.
 Freddie Laker, a British entrepreneur, introduced a London-New York route, selling it for one-half the
normal airfare.
 Other countries and airlines followed with economy fares to and from European cities.

 Since 1950, incomes have increased rapidly while airfares have declined and this made air travel more
attractive than ever.

DHVSU Vision Mission Page 10 of 12

Vision – A lead university in producing quality individuals with competent Mission – DHVSU commits itself to provide an environment conducive to
capacities to generate knowledge and technology and enhance continuous creation of knowledge and technology towards the transformation
professional practices for sustainable national and global competitiveness of students into globally competitive professionals through the synergy of
through continuous innovations. appropriate teaching, research, service and productivity functions.
  While the price of an airline ticket decreased, the quality of service with regard to speed, size and
comfort improved.

Airline Regulation
 International tourism requires a system of international air transportation.
 This system requires negotiations among nations and carriers in the form of bilateral agreements.
 Overflight privileges must be obtained from all nations over which an airline will cross during
international flights.
 Airlines are or may be assessed overnight charges for the privilege of flying over other nations including
countries which do not have formal diplomat relations with each other like Cuba and the United States.
 Lending rights, fuel purchase agreements, maintenance provisions, and other considerations require
bilateral negotiation.

 Governments throughout the world have agreed that a complete free market for international air travel
is not possible.
 The original idea for a worldwide system of airline regulation took place in the Chicago Convention of
1944 and the Bermuda Agreement of 1946.

 The Chicago Convention marked the beginning of continuous dialogue about various freedoms of the
air but was not successful in establishing a multilateral system of commercial aviation rights.
 The Bermuda Agreement established the first worldwide model for future bilateral agreements
regarding the exercise of the eight freedoms of the air:
1. First Freedom: The right of an airline to overfly one country to get to another;
2. Second Freedom: The right of an airline to land in another country for a technical stopover
(fuel, maintenance, etc.) but does not pick up or drop off traffic;
3. Third Freedom: The right of an airline, registered in country X, to drop off traffic from country X
to country Y;
4. Fourth Freedom: The right of an airline, registered in country X, to carry traffic back to country
X from country Y;
5. Fifth Freedom: The right of an airline, registered in country X, to collect traffic in country Y and
fly on to country Z, so long as the flight either originates or terminates in country X;
6. Sixth Freedom: The right of an airline, registered in country X, to carry traffic to a gateway–a
point in country X–and then abroad. The traffic has neither its origin nor ultimate destination in
country X;
7. Seventh Freedom: The right of an airline registered in country X, to operate entirely outside of
country X in carrying traffic between two other countries; and
8. Eight Freedom: The right of an airline, registered in country X, to carry traffic between any two
points in the same foreign country; also known as cabotage.

 Only the first two technical freedoms have been widely accepted.
 The third, fourth, fifth and sixth freedoms are still subject to bilateral bargaining.
 The seventh and eight freedoms are usually allowed only in special circumstances.

 The bilateral air agreement concepts which resulted from these meetings meant that airline service
could not be offered between a nation of origin and one of destination unless there was a specific
agreement between the two nations regarding the details of the service.
 Bilateral agreements were established to provide for the orderly development of the international air
transportation industry.
 The need for bilateral agreements intensified because small nations felt that they should have their own
national airline or flag carrier.
 A large number of flag carriers are government-owned enterprises.
 Some are subsidized by the government because of national pride, fear of dependency on foreign
carriers, as a means of supporting economic development, and to ensure air freight for export products.

DHVSU Vision Mission Page 11 of 12

Vision – A lead university in producing quality individuals with competent Mission – DHVSU commits itself to provide an environment conducive to
capacities to generate knowledge and technology and enhance continuous creation of knowledge and technology towards the transformation
professional practices for sustainable national and global competitiveness of students into globally competitive professionals through the synergy of
through continuous innovations. appropriate teaching, research, service and productivity functions.
  Airlines of the United States and other countries are owned and operated by private enterprises and
must operate for a profit.

 The use of the bilateral air agreements was not enough to meet the need for cooperation between
international airlines with different profit orientation.
 After the Chicago Conference, several scheduled carriers met in Havana and the International Air
Transport Association (IATA) was formed to ensure cooperation among international carriers.
 IATA is a democratic organization whose membership is open to any member of the United Nations.
 It is supported by dues from 140 active and associate member airlines.
 It links together with many non-IATA carriers throughout the world in Multinational Interline Traffic
Agreement.
 This agreement allows passengers to use a single ticket and travel by several carriers around the world
and it also makes the movement of air freight worldwide easier.

 The primary purpose of IATA is to establish a system of international rates and fares.
 Through IATA, the airlines enter into agreements concerning rates, conditions of services, and routes to
be given to each airline.
 The agreement are subject to the approval of their respective governments.

DHVSU Vision Mission Page 12 of 12

Vision – A lead university in producing quality individuals with competent Mission – DHVSU commits itself to provide an environment conducive to
capacities to generate knowledge and technology and enhance continuous creation of knowledge and technology towards the transformation
professional practices for sustainable national and global competitiveness of students into globally competitive professionals through the synergy of
through continuous innovations. appropriate teaching, research, service and productivity functions.