A Predictive Model of User Equipage Costs for Future Air Traffic Services and Capabilities: An ADS-B Example Kent V. Hollinger, P.E. James D. Nickum, P.E. Doyle T. Peed Todd M. Stock NDIA Systems Engineering Conference October 26, 2006 © 2005 The MITRE Corporation. All Rights Reserved. Approved for Public Release; Distribution Unlimited 05-0826 NDIA Systems Engineering Conference October 26, 2006 Overview • The air transport model-specific fleet forecast • The general aviation type-specific forecast • Aircraft classification, equipage states and costs • Possible user responses to FAA implementation • Equipage costs of voluntary responses and mandates 2 © 2005 The MITRE Corporation. All Rights Reserved. NDIA Systems Engineering Conference October 26, 2006 Why a Model-Specific Fleet Forecast? • Most forecasts provide detail only to the level of “narrow body” and “wide body” • In most cases, the cost to modify a DC-9 can be greatly different than a B737-800 • Model-specific equipage knowledge allows for forecasting penetration of various technologies 3 © 2005 The MITRE Corporation. All Rights Reserved. NDIA Systems Engineering Conference October 26, 2006 Bottom-up Approach Models 2002 2003 2004 2005 ……..………. 2030 Forecast = Actual aircraft in past years (per airline) + Firm commitments by year (per airline) - Retirements by year (per airline) + Cargo conversions (airline unknown) + Future deliveries to unknown airlines US Fleet =+A/L #1 A/L #n + Cargo Cx OEM 4 © 2005 The MITRE Corporation. All Rights Reserved. NDIA Systems Engineering Conference October 26, 2006 SEC Filings of Publicly Traded Airlines UNITED STATES SECURITIES AND EXCHANGE UNITED STATES SECURITIES AND EXCHANGE COMMISSION WASHINGTON, D.C. 20549 COMMISSION FORM 10-K ANNUAL REPORT PURSUANT TO SECTION 13 or 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 WASHINGTON, D.C. 20549 FOR THE FISCAL YEAR ENDED DECEMBER 31, 2003 OR FORM 10-K TRANSITION REPORT PURSUANT TO SECTION 13 or 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 COMMISSION FILE NUMBER 1-12649 AMERICA WEST ANNUAL HOLDINGS REPORT CORPORATION PURSUANT TO SECTION 13 or 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 (EXACT NAME OF REGISTRANT AS SPECIFIED IN ITS CHARTER) DELAWARE FOR THE FISCAL 86-0847214 YEAR ENDED DECEMBER 31, 2003 (STATE OR OTHER JURISDICTION OF INCORPORATION (I.R.S. EMPLOYER IDENTIFICATION NO.) OR ORGANIZATION) 111 WEST RIO SALADO PARKWAY (480) 693-0800 TEMPE, ARIZONA 85281 (REGISTRANT’S TELEPHONE NUMBER, INCLUDING (ADDRESS OF PRINCIPAL EXECUTIVE OFFICES) AREA CODE) OR SECURITIES REGISTERED PURSUANT TO SECTION 12(b) OF THE ACT: TITLE OF EACH CLASS NAME OF EACH EXCHANGE ON WHICH REGISTERED: CLASS B COMMON STOCK, $.01 PAR VALUE NEW YORK STOCK EXCHANGE TRANSITION REPORT PURSUANT TO SECTION 13 or 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 COMMISSION FILE NUMBER 1-12649 AMERICA WEST HOLDINGS CORPORATION (EXACT NAME OF REGISTRANT AS SPECIFIED IN ITS CHARTER) DELAWARE 86-0847214 (STATE OR OTHER JURISDICTION OF INCORPORATION (I.R.S. EMPLOYER IDENTIFICATION NO.) OR ORGANIZATION) 111 WEST RIO SALADO PARKWAY (480) 693-0800 TEMPE, ARIZONA 85281 (REGISTRANT’S TELEPHONE NUMBER, INCLUDING (ADDRESS OF PRINCIPAL EXECUTIVE OFFICES) AREA CODE) SECURITIES REGISTERED PURSUANT TO SECTION 12(b) OF THE ACT: TITLE OF EACH CLASS NAME OF EACH EXCHANGE ON WHICH REGISTERED: CLASS B COMMON STOCK, $.01 PAR VALUE NEW YORK STOCK EXCHANGE 5 © 2005 The MITRE Corporation. All Rights Reserved. NDIA Systems Engineering Conference October 26, 2006 SEC Filings of Publicly Traded Airlines UNITED STATES SECURITIES AND EXCHANGE COMMISSION WASHINGTON, D.C. 20549 Actual Aircraft FORM 10-K ANNUAL REPORT PURSUANT TO SECTION 13 or 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 FOR THE FISCAL YEAR ENDED DECEMBER 31, 2003 Number 12/31 Average Age (Yrs.) 12/31 OR TRANSITION REPORT PURSUANT TO SECTION 13 or 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 Aircraft Approx. Types No. Seats 2003 2004 2003 2004 COMMISSION FILE NUMBER 1-12649 AMERICA WEST HOLDINGS CORPORATION (EXACT NAME OF REGISTRANT AS SPECIFIED IN ITS CHARTER) DELAWARE 86-0847214 B737-200 113 8 0 22.1 n/a (STATE OR OTHER JURISDICTION OF INCORPORATION (I.R.S. EMPLOYER IDENTIFICATION NO.) OR ORGANIZATION) B737-300 132 37 37 15.9 16.9 111 WEST RIO SALADO PARKWAY (480) 693-0800 TEMPE, ARIZONA 85281 (REGISTRANT’S TELEPHONE NUMBER, INCLUDING (ADDRESS OF PRINCIPAL EXECUTIVE OFFICES) AREA CODE) B757-200 190 13 13 17.2 18.2 SECURITIES REGISTERED PURSUANT TO SECTION 12(b) OF THE ACT: A319-100 124 32 33 3.3 4.2 TITLE OF EACH CLASS NAME OF EACH EXCHANGE ON WHICH REGISTERED: CLASS B COMMON STOCK, $.01 PAR VALUE NEW YORK STOCK EXCHANGE A320-200 150 49 54 7.8 8.5 Totals 139 137 10.7 10.7 Firm Commitments 2004 2005 2006 2007 2008 Firm orders (A318-100/A319-100/A320-200) 2 2 7 8 0 Lessor put options 4(a) 2 4 0 0 Lease terminations: Scheduled lease expirations 7 13 16 10 11 Lessor call options 9(b) 1(c) 0 0 0 6 © 2005 The MITRE Corporation. All Rights Reserved. NDIA Systems Engineering Conference October 26, 2006 Firm Commitments (as of Dec. 2003) US Aircraft Orders 2004 2005 2006 2007 A300 8101011 A310 1001 A318 2200 A319 11 32 12 13 A320 21 16 32 23 A321 1444 A330 3447 A380 0000 B717 13940 B737-700 52 33 27 30 B737-800 18 26 31 40 B737-900 1 2 0 0 B757-300 6 0 0 0 B767-200 2 3 0 0 B777 0242 MD-11 4100 Total Large Aircraft 143 144 128 131 7 © 2005 The MITRE Corporation. All Rights Reserved. NDIA Systems Engineering Conference October 26, 2006 Retirements Forecasted at 25 Years of Age AMERICA WEST AIRLINES A319 2023 3 2024 7 2025 11 2026 10 2027 1 A319 Total 32 A320 2014 12 2015 3 2016 2 2017 1 2019 1 2020 4 2021 1 2022 3 2023 4 2024 7 2025 5 2026 3 2027 3 2028 3 A320 Total 52 B737-200 2006 4 2007 5 B737-200 Total 9 8 © 2005 The MITRE Corporation. All Rights Reserved. NDIA Systems Engineering Conference October 26, 2006 Cargo Conversions of Certain Models EQUIPMENTMODEL FC2004 FC2005 FC2006 FC2007 FC2008 B737-200 13 2 8 11 10 B747-100 41100 B747-200 84211 B747-300 00001 B757-200 00004 B767-200 000315 9 © 2005 The MITRE Corporation. All Rights Reserved. NDIA Systems Engineering Conference October 26, 2006 Reconciliation with FAA Forecast • Since the model-specific forecast uses only Firm Commitments (which are zero after 2012), provision must be made for additional aircraft that will be delivered • A preliminary summation forecast is compared to FAA forecasts to determine the gaps • Use both – FAA Aerospace Forecasts Fiscal Years 2004 – 2015 – FAA Long-Range Aerospace Forecasts Fiscal Years 2015, 2020, 2025 and 2030 10 © 2005 The MITRE Corporation. All Rights Reserved. NDIA Systems Engineering Conference October 26, 2006 FAA Aerospace Forecasts Fiscal Years 2004 – 2015 TABLE 22 U.S. LARGE AIR CARRIERS PASSENGER JET AIRCRAFT CALENDAR LARGE NARROWBODY LARGE WIDEBODY LARGE REGIONAL TOTAL YEAR 2 ENGINE 3 ENGINE 4 ENGINE TOTAL 2 ENGINE 3 ENGINE 4 ENGINE TOTAL JETS JETS JETS Historical 1998 2,949 508 32 3,489 309 226 122 657 4,146 10 4,156 1999 3,139 436 21 3,596 361 204 129 694 4,290 18 4,308 2000 3,362 385 9 3,756 424 169 120 713 4,469 26 4,495 2001 3,432 228 11 3,671 461 105 98 664 4,335 18 4,353 2002 3,406 145 0 3,551 482 86 90 658 4,209 1 4,210 2003E 3,370 101 0 3,471 480 56 74 610 4,081 9 4,090 Forecast 2004 3,399 101 0 3,500 492 51 73 616 4,116 9 4,125 2005 3,504 100 0 3,604 514 42 73 629 4,233 16 4,249 2006 3,633 99 0 3,732 534 34 73 641 4,373 35 4,408 2007 3,728 98 0 3,826 554 33 73 660 4,486 53 4,539 2008 3,846 97 0 3,943 570 31 71 672 4,615 71 4,686 2009 3,972 96 0 4,068 581 29 68 678 4,746 89 4,835 2010 4,096 95 0 4,191 596 29 64 689 4,880 107 4,987 2011 4,219 94 0 4,313 611 30 64 705 5,018 124 5,142 2012 4,331 94 0 4,425 625 30 64 719 5,144 139 5,283 2013 4,451 94 0 4,545 637 30 64 731 5,276 149 5,425 2014 4,575 94 0 4,669 646 30 64 740 5,409 159 5,568 2015 4,721 94 0 4,815 654 30 64 748 5,563 169 5,732 11 © 2005 The MITRE Corporation. All Rights Reserved. NDIA Systems Engineering Conference October 26, 2006 OEM Plug (deliveries to unknown airlines) EQUIPMENTMODEL FC2004 FC2005 FC2006 FC2007 FC2008 FC2009 FC2010 … A300 7 8 7 13 6 A318 3 6 4 8 14 24 A319 6 15 6 20 25 45 A320 6 15 6 20 25 45 A321 1 4 9 14 A330 6 8 8171221 A380 4 B737-700 6 15 7 22 31 56 B737-800 6 15 7 22 31 56 B737-900 3 5 3 8 12 16 B777-200 14 17 15 30 18 21 CRJ200 92220161616 CRJ440 277568 CRJ700 92222161718 CRJ900 31818161718 Do328Jet 4 10 12 12 12 12 ERJ-135 4106663 ERJ-140 4106663 ERJ-145 8 30 29 6 6 11 ERJ-170 71216181921 ERJ-190 610161921 TOTAL Plug 30 77 251 210 281 307 433 12 © 2005 The MITRE Corporation.