Travel Catering Research

North America - April to June 2006 Estimate *

Passenger Numbers by Route (millions)

	Jan-Mar '06	Jan-Mar '05	% change	Apr-Jun '05	Estimate
Domestic	155.07	153.68	0.90%	171.84	173.40
International	35.57	35.16	1.15%	38.06	38.50
Total	190.64	188.85	0.95%	209.91	211.90

Overall, passenger numbers show a slight increase compared to the corresponding period of last year at the rate of over 0.95%. Particularly, after a slight decline in the previous quarter, passenger numbers for International market has increased to be at the same level as the corresponding period of the previous year.

Passenger Numbers by Seat Class (millions)

	Jan-Mar '06	Jan-Mar '05	% change	Apr-Jun '05	Estimate
First	14.37	14.24	0.92%	15.83	15.98
Business	5.41	5.37	0.88%	5.97	6.02
Coach	170.85	169.23	0.95%	188.11	189.90

Overall, the rate of growth in all three seat classes continue to grow very slightly and the estimate of travelling in these three seat classes for the second quarter of 2006 will be slightly higher compared to the corresponding period of last year.

Estimated Complimentary Meal Numbers and Type by Route (millions)

	Jan-Mar '06	Jan-Mar '05	% change	Apr-Jun '05	Estimate
Domestic
Snack	92.42	91.59	0.90%	102.42	103.34
Breakfast	12.09	11.99	0.90%	13.40	13.52
Lunch/Dinner	38.92	38.57	0.90%	43.13	43.52
International
Snack/Breakfast	28.38	28.06	1.15%	30.37	30.72
Lunch/Dinner	28.28	27.95	1.15%	30.26	30.61

Complimentary meal numbers reflect trends in passenger numbers. Overall, meal numbers show a slight increase compared to the corresponding quarter of last year. The estimate numbers are also slightly higher than the same quarter in the previous year.

Passenger Numbers by Carrier (millions)

	Jan-Mar '06	Jan-Mar '05	% change	Apr-Jun '05	Estimate
American	23.64	21.76	9%	25.44	27.64
Continental	10.98	10.03	9%	10.93	11.96
Delta	18.04	21.57	-16%	23.09	19.31
North West	12.12	13.51	-10%	15.15	13.60
United	15.93	15.69	2%	17.14	17.41
US Air	8.81	10.65	-17%	11.58	9.58
Southwest	22.03	19.79	11%	22.79	25.36
Others	79.09	75.85	4%	83.79	87.37

Three major US airlines that have filed for bankruptcy, US Air, Delta, and North West saw a significant decrease in passenger numbers, the Southwest together with American and Continental continue to show an increase in numbers. United saw an increase in passenger numbers for the first time after having the continual declines in the previous three quarters. However, this is the fourth quarter that passenger numbers have dropped for US Air.

Current Headlines

Delta

Delta Air Lines announced that it will become the world's largest airline between the United States and Europe in terms of destinations served, seat capacity and weekly flights with the introduction of new and expanded service between the United States and Athens, Greece; Edinburgh, Scotland; Venice, Italy; and Kiev, Ukraine.

The airline is also upgrading the in-flight experience for its international coach customers. Beginning July 1, customers seated in the coach cabin on most of Delta's international flights will receive printed menus; a complimentary choice of cocktail, including the new Mile High Mojito or Mango Kiss, beer or wine during the main in-flight meal service; and a mid-flight snack. Delta's new mid-flight snack service will offer customers:

On flights from the United States to Europe, a choice of grilled cheese crackers, peanuts, Biscoff cookies and Sunchips®;
On flights from Europe to the United States, a vanilla ice cream cup; and
On flights to and from India, a choice of Toblerone chocolates, shortbread cookies, nuts or snack mix

Source: http://news.delta.com/article_display.cfm?article_id=10242 May/30/2006
Source: http://news.delta.com/article_display.cfm?article_id=10282 Jun/28/2006

United

United announced that it is strengthening its service to the Asia Pacific region by adding 40 more weekly, year-round flights and additional cargo capacity to its schedule during the next nine months. This move solidifies United's position as the world's largest transpacific passenger carrier, placing United's assets where they will provide the greatest return for United and its customers while leveraging the company's strengths – its customer base, hub airports and Asia Pacific network.

Source: http://www.united.com/press/detail/0,6862,54554-1,00.html Jul/28/2006

United – Air Canada – American

Competitions for the Chinese markets become fiercer as three major North American airlines including United, Air Canada and American are expanding their routes to the country

Firstly, United and Shanghai Airlines and United Airlines have signed a code-share agreement that expands international destination options and frequent flyer opportunities for customers of both carriers. Pending U.S. government approval, the 11 code-share flights covered by the agreement are scheduled to commence May 15. Once the agreement takes effect, customers from both carriers will be able to accrue and redeem frequent flyer miles and enjoy airport lounges supported by both carriers.

This is followed by Air Canada who aims to strengthening its position as the leading North American carrier to Asia with the departure today of flight AC087, its new non-stop service between Toronto and Shanghai. Shanghai has been long regarded as a gateway to the Orient. The new three-times weekly service is the only non-stop flight from eastern North America to Shanghai and offers the fastest flying time from Toronto.

American Airlines has also launched the inaugural flight of American Airlines' daily non-stop service from Chicago O'Hare International Airport to Shanghai Pu Dong International Airport in Shanghai, China.

In addition, American Airlines has announced it has filed an application with the United States Department of Transportation to operate daily non-stop service between Dallas/Fort Worth International Airport (DFW) and Beijing, China, starting March 25, 2007. American plans to serve the route with its 245-seat Boeing 777 aircraft in three-class configuration.

Source: http://www.united.com/press/detail/0,6862,53828-1,00.html March/21/2006
Source: http://micro.newswire.ca/release.cgi?rkey=1406174929&view=13213-0&Start=20 June/17/2006
Source: http://www.aa.com/content/amrcorp/pressReleases/2006_04/20_flair.jhtml April/20/2006
Source: http://www.aa.com/content/amrcorp/pressReleases/2006_07/0720_beijing.jhtml July/20/2006

Explanations

Passenger Numbers by Route

* The North American Report is classed as an estimate rather than a forecast because of the time lag in receiving data. There is a three month delay in domestic passenger data being inputted into the Intermodal Transportation Database and a four month delay for international numbers.

The data in this table is derived from the Intermodal Transportation Database available on the Bureau of Transportation Statistics website.

% change - This compares the last full quarter of this year with the same quarter in the previous year.

Estimate - The estimate is based on the trend derived from the equivalent quarter of the previous year and the percentage change in the last full quarter.

Passenger Numbers by Seat Class

The data in this table is derived from data found on Euromonitor's web pages. The seat class data is defined by country and is then applied to the major carrier for that country.

Estimated Complimentary Meal Numbers by Route

The data in this table is calculated by taking the total passenger numbers by route and applying a formula to provide an estimate of the types of meals provided to passengers. This figure is then manipulated to consider the take up of this particular meal type (i.e. snack, breakfast, lunch or dinner) by passengers (based on load factor data). The formulae used to arrive at these figures are based upon consensus meal values agreed upon by a panel of experts. In the future these formulae will be subject to change on a monthly basis.

% change – Please see above.

Estimate – Please see above.

Passenger Numbers by Carrier

The data in this table is derived from the Intermodal Transportation Database available on the Bureau of Transportation Statistics website. Southwest Airlines is the only major carrier specified whose passenger numbers are for domestic (intra-continental) flights only.

The 'Others' category includes passenger numbers from other US based airlines such as Alaska Airlines and American Eagle Airlines as well as including all international carriers who have routes into/within and from the USA.