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38 CHAPTER 3. FACTORS WHICH INFLUENCE THE CHOICE OF MODE FOR THE LONG-DISTANCE TRIP 3(A) INTRODUCTION AND STRUCTURE INTRODUCTION This chapter of the Final Report presents some important findings about how Americans make the decision between taking a long-distance trip by air and taking a long-distance trip by car. In fact, the choice of the air mode is relatively rare for most Americans. Calculations presented in Chapter 2 reveal that today the average American citizen takes less than one round trip per year13 by plane. While the rate of air travel is increasing, it is increasing gradually: the number of air trips per capita today is approximately 18% higher than it was in 1995. This represents an incremental growth rate stronger than that of auto travel (long-distance and otherwise), which has grown approximately 7% during the same period. This chapter examines the factors that help to explain the choice between using the car or plane for trips longer than 200 miles. The central role of trip distance was established in Chapter 2, which demonstrated that an increase in trip distance is associated with a decrease in travel by car. This chapter builds on that central relationship and examines the interrelationship between trip distance and the following: ï· Trip cost. ï· Trip purpose. ï· Trip party size. ï· Traveler income. ï· Perceived need for an auto at the destination end of the trip. This chapter reviews many other factors (e.g., age, gender) using the same analytical format (i.e., mode share by distance and the candidate factor), but the five factors listed above emerged as the most determinant factors in the ACRP analysis. The results of the 2017 survey suggest that Americans make decisions about longer distance travel in a utilitarian mannerâbut that understanding, and interpretation of those decisions can benefit from the careful integration with values, preferences, and attitudes toward those trips and toward the places in which they live. The research team constructed a Structural Equation Model that integrates both âhardâ and âsoftâ factors in the travel decision-making process. Analysis of the output of that model suggests that the decision between air and car is first and foremost a mental process which weighs the problem of the cost of air versus the problem of the unpleasantness of the carâs long travel times. The purpose of this research is to help develop understanding of the trade-offs between car and air in mode choice among different population groups. The research identifies key indicators of attitudes and behavior by different market segments. It should be noted that this section does not 13 As shown in Chapter 2, the âaverageâ number of air round trips per year rose from .8 trips per person in 1995, to .9 trips per person in 2016.
39 include an analysis of the service characteristics of different airports in the survey. How people respond to optionsâ the way they react to fares, travel times and pre-boarding timesâis very transferable across socio-demographic groups. The specific service characteristics, such as average business or economy fares, the number and times of direct flights to the destinations, and average peak and non-peak security times, are not similarly transferable. STRUCTURE Chapter 3 addresses dominant factors that influence the decision between the car and the airplane for the longer-distance trip. The role of trip length is examined in some detail, both in terms of its role in supply-side characteristics and in terms of the demand-side role of trip length influencing mode choice. Chapter 4 then highlights the role of the automobile in the selection of the airport of departure, with particular reference to the choice between closer, smaller airports and more distant, better served larger airports. It introduces the concept of âleakageâ of markets from the smaller to the larger airports. 3(B) THE CHOICE BETWEEN THE CAR AND THE PLANE FOR THE LONG-DISTANCE TRIP THE ALL-IMPORTANT ROLE OF TRIP DISTANCE The length of the trip is the major variable in the examination of the competition between air travel and travel via automobile. Most long-distance travel occurs in the shorter trip lengthsâfor example, 85% of trips over 100 miles by all modes and purposes are under 800 miles in distance. Mode share, by distanceâAmerican Travel Survey (ATS) data from 1995 Figure 3-1 uses 1995 ATS data to illustrate how the role of air increases in concert with trip distance and, inversely, how the role of automobile decreases with the rise in trip distance. In the1995 survey, the automobile dominated for trips under 600 miles, at which point air dominated for longer trip lengths. Automobile mode shares of approximately 20% persist until 1,500 miles, falling to under 10% only for trips over 1,500 miles.
40 FIGURE 3-1. EFFECT OF DISTANCE ON SHARE BETWEEN AIR AND AUTO, 1995. Source: McGuckin from 1995 ATS. (POV = Personally owned vehicles.) 3(C) THE SUPPLY SIDE: HOW COSTS ARE INFLUENCED BY DISTANCE COSTS EXPERIENCED FOR EACH MODE The Bureau of Transportation Statistics (BTS) has published a valuable summary of transportation statistics, Passenger Travel Facts and Figures 2016, which provides details about long-term travel. The report includes a summary of the average expenditure on transportation in the year of 2014. According to these statistics, the âaverageâ American spent $370 per year for airline fares. This can be compared with the expenditure of about $8,500 per year to support the privately-owned automobile; of this amount, approximately $3,300 (or nearly 40%) was associated with âvehicle purchase,â sometimes called depreciation. The rest of the costs are not associated with âpurchaseâ and many such costs vary directly by miles traveled. Thus, when a possible long-distance trip is considered, significant capital has already been expended to maintain the availability of a private automobile. Other figures in the âFacts and Figuresâ report show that the cost of owning and operating an automobile in 2014 is virtually the same as it was in 1990, when expressed in constant dollars, but somewhat lower than experienced in 2000.
41 Airlines for America reports that the average airfare, after adjustment for inflation, fell from approximately $0.20 per mile in 1995 (the years of the ATS) to slightly less than $0.16 per mile today (including baggage fees).14 For the four regional areas in our 2017 survey the average cost per mile is approximately $0.26, (Figure 3-2) which includes the price of parking at the airport. Based on self-reported costs, our survey respondents reported paying approximately $0.10 per mile for the longest trips, which reveals that airlines have a highly competitive product in the longest-distance trips. The âaverageâ survey respondent paid $437 for his or her reference air trip flight, and approximately 10% of that cost was attributable to parking costs and baggage fees. THE PRICE OF THE AIR TRIP, BY DISTANCE The price of air travel has a powerful effect on mode choice for long-distance trips as does the number of hours of driving that would be necessary for the alternative mode trip by auto. âAir Trip Costâ in our work was derived from the survey results as the sum of the reported round trip airfare, reported per-person parking costs, and reported baggage fees. Importantly, the price per mile paid by the consumer varies substantially by the length of the trip for the four market areas covered in the survey. As trip length increases, the price per mile offered by the airlines becomes more of a bargain for the customer. However, the air trip of under 700-mile distance (one-way) is starkly higher in cost per mile. Figure 3-2 shows how different the short air trip cost is from the others. FIGURE 3-2 AIR COSTS PER MILE, BY TRIP DISTANCE Source: 2017 ACRP Project Survey As might be expected, the costs associated with a business trip are approximately 20% higher than costs associated with a nonbusiness trip. As discussed in subsequent sections, the total cost 14 https://www.theatlantic.com/business/archive/2013/02/how-airline-ticket-prices-fell-50-in-30-years-and-why- nobody-noticed/273506/ $- $0.05 $0.10 $0.15 $0.20 $0.25 $0.30 $0.35 $0.40 $0.45 300-700 700-1100 1100-1500 1500-1900 1900-2300 Above 2300 To ta l p er m ile C os t o f A ir Tr ip One-way Trip Distance, in Miles
42 per person of a round-trip business trip is estimated at $451 while the total cost of the round-trip nonbusiness trip is $377, which is shown in Table 3-1. Over 85% of primarily business trips in the 2017 ACRP survey were fully or partially paid for by employers. Figure 3-3 illustrates the fully allocated costs of the airplane versus the car as a function of trip distance and party size. The overall flatness of the air cost curve over distance is noticeable. The âfully allocatedâ costs of the one-person auto trip are also noteworthy. TABLE 3-1. 2017 AIR TRIP COSTS TRIP PURPOSE TOTAL COST Primarily Business $451 Primarily Leisure $377 THE PRICE OF THE AUTO TRIP, BY DISTANCE This section and its analysis explore the implications of the way in which the traveler interprets auto costs, as opposed to what has been established as fully allocated costs. Specifically, the traveler has a much narrower view of the incremental costs of driving the private vehicle for long-distance trips. The combination of gas and tolls are often referenced in the popular literature as the âout-of-pocket costs.â However, such costs might represent approximately half of the actual mileage-based costs. $- $500 $1,000 $1,500 $2,000 $2,500 $3,000 $3,500 300-700 700-1100 1100-1500 1500-1900 1900-2300 Above 2300 R ou nd T rip C os t p er P er so n One-way Trip Distance, in Miles One Person In Car Two in Car Four in Car Air Trip Cost
43 FIGURE 3-3. FULLY ALLOCATED ROUND TRIP COSTS, BY MODE AND PARTY SIZE; CAR COSTS AT $0.54 PER MILE The research team first calculated âcar trip costâ for a single-party trip, using auto travel costs from the BTS report on costs, to generate per-mile vehicle costs for all categories that vary by mileageâexcluding the cost of purchasing the vehicle. To update the data, the research team used a fully allocated cost of $0.54 per mile, which is consistent with the auto costs for travel expenses allowed by the Internal Revenue Service (IRS). The IRS accepts a similar number for travel cost calculations for income tax purposes. To account for the cost of staying overnight on longer trips, we assumed a night with lodging for every 700 miles, based on the analysis of this survey data. Approximately 85% of two-day travelers are taking trips of fewer than 1,200 miles, which would suggest that 700 miles is a reasonable distance for the first nightâs lodging. A brief review of chain motels suggested that $90 would cover one basic room, with taxes and other costs included. Both Figure 3-3 and Figure 3-4 reflect the assumption of no lodging for the first 700 miles, two nights of lodging for 1,500 miles, and three nights of lodging for anything over 1,500 miles. In Figure 3-3, the auto trip costs for a one-person trip party are divided by two for a two-person trip party, and by four for a four-person trip party, assuming that all trip members could utilize a single motel room. FIGURE 3-4. COST MODEL, WITH NON-FIXED ROUND TRIP CAR COSTS AT $0.23 PER MILE Variable costs include gas at $0.11 per mile, maintenance at $0.05 per mile, and tolls at $0.04 per mile. Concerning the value of depreciation, the American Automobile Association calculates15 that a 5,000 increase in mileage equates to $180 in increased depreciation, or approximately $0.04 per mile. The research team used a nonfixed cost of $0.23 cents per mile in the calculation for Figure 3 4 that utilizes the average party size of 2.3 persons, derived from the 2017 ACRP survey. 15 http://exchange.aaa.com/wp-content/uploads/2015/04/Your-Driving-Costs-2015.pdf $- $100 $200 $300 $400 $500 $600 $700 $800 300-700 700-1100 1100-1500 1500-1900 1900-2300 above 2300 R ou nd T rip C os t p er P er so n One-way Trip Distance, in Miles Car Average Party Size Air Trip Cost
44 The trade-off in Figure 3-4 is largely based on the difference between the per-person cost of the airplane trip (which does not vary by trip party size) and the per-person cost of the car trip, which does vary by trip party size. In addition, increase in distance has a larger (and more linear) effect on total costs for the car than for the plane. Figure 3-3 shows that for a person traveling alone the air ticket is cheaper than the fully allocated costs of the auto at any range included in this studyâwith even the four-person air trip competitive at over 1,000 miles of one-way distance. Reasons to look at fully allocated costs Policy implications can be inferred when comparing Figure 3-3 and Figure 3-4. If society could implement a cost allocation system that charged all costs on a per-mile basis, then the individual traveler would have a greater incentive to choose a more cost-effective mode. Despite difficulties associated with the implementation of such a system, analysts writing about autonomous vehicles often assume that vehicle ownership would be collective, and that fees would be solely based on a per-mile basis. Advocates of more efficient transportation also support the concept of encouraging more incremental charging by use, rather than accepting the fixed costs of ownership. The growth of programs that encourage people to âshareâ cars is consistent with a move towards greater emphasis on incremental cost allocation, as a way to minimize non- essential VMT. In addition, comparing Figure 3-3 and Figure 3-4 shows how sensitive the price-estimation process is to assumptions about what costs vary with incremental driving and what costs do not. While Figure 3-4 was created based on research into the true non-fixed costs (costs that vary by mileage), extensive reference is made in the literature to âgas and tollsâ as the proxy for âout-of- pocketâ costs. Using the same base assumptions, such costs would look like 15 cents per mile, instead of the 23 cents used this chart. The logical implications of the two figures are important. Common use of âout of pocketâ costs suggests the cost of driving a mile at 15 cents, when the IRS has established it at 54 cents! Thus, the real costs of driving tend to be underestimated in the mind of the traveler. 3(D) THE DEMAND SIDE: HOW MODE SHARE IS INFLUENCED BY DISTANCE IMPORTANCE OF TRIP DISTANCE IN INTERACTION WITH OTHER FACTORS This section reviews major factors that interact with trip distance in the explanation of mode choice between air and auto, using the data from the ACRP 2017 Survey. In the first analysis, the sample was divided into three income groups, with Figure 3-5 showing the difference between the highest and lowest income groups. The curves for both groups reflect the observation that longer distances are associated with lower auto mode share and higher air mode shares. The higher income curve seems to flatten in the higher distance categories, at which point approximately 10% of travelers continue to choose to travel by car. For trips of the same distance, approximately 20% of the lower-income group chooses to travel by car. At the highest distance lengths, variables other than income and trip length are needed to explain why 10â20% of travelers remain with auto. Later sections address the question of who is still choosing the auto at these distances.
45 Income, by distance FIGURE 3-5. AUTO SHARE BY TRIP DISTANCE, FOR TWO INCOME GROUPS Source: 2017 ACRP Survey Age, by distance As with all demographic subgroups examined, travel by auto among Millennials decreases as trip distance increases, as shown in Figure 3-6. However, distance seems to play a less dramatic role for the younger group than for the older group since the decline in auto travel as distance increases is less pronounced for Millennials. Thus, Millennials are less likely than the older group to choose the car for shorter trips but are more likely to choose the car for trips longer than 1,700 miles. The fact that Millennials are less likely to travel by car for shorter trips is consistent with much of the attitudinal data presented in this report, and in other recent CRP studies; the fact that Millennials have a higher propensity to choose the auto for the longest trip is worthy of further research. In our sample, 86% of Millennials are working for pay, while only 63% of the older groups are working for pay. Thus, the younger group is more likely to be on a business trip, whose modal implications are explored here. 0% 10% 20% 30% 40% 50% 60% 70% 80% 300-700 700-1100 1100-1500 1500-1900 1900-2300 above 2300 A ut o M od e S ha re One-way Distance, in Miles Under $75k Over $100k
46 FIGURE 3-6. EFFECT OF TRIP DISTANCE ON AUTO MODE SHARE, TWO AGE GROUPS Source: 2017 ACRP Survey Trip purpose, by distance Compared to those traveling for leisure, those traveling on business have a far greater propensity to take the airplane for the short distance trip, and a far lower propensity to take it for trips over 1,900 miles (Figure 3-7). Again, for trips up to approximately 1,700 miles, costs associated with the trips can likely explain the pattern. Shorter-distance airplane tickets cost more per mile (Figure 3-2) than taking the same trip by carâand someone other than the traveler is paying for this far-faster business mode. However, the auto seems to play a key role in many long business trips, including trips with multiple destinations (see Figure 3-10 later in this chapter.) FIGURE 3-7. AUTO MODE SHARE, BY DISTANCE BY TRIP PURPOSE Source: 2017 ACRP Survey 0% 10% 20% 30% 40% 50% 60% 70% 80% 300â700 700â1100 1100â1500 1500â1900 1900â2300 aboveÂ 2300 Au to Â M od eÂ Sh ar e OneâwayÂ TripÂ Distance,Â inÂ Miles OlderÂ Groups Millennials 0% 10% 20% 30% 40% 50% 60% 70% 80% 300-700 700-1100 1100-1500 1500-1900 1900-2300 Above 2300 A ut o M od e S ha re One-way Trip Distance, in Miles Primarily Business Primarily Leisure
47 Travel party size, by distance But what about people traveling in larger groups? In the 2017 ACRP survey, the average travel party size was 2.3. Figure 3-8 shows the auto mode share by distance for one or two persons in a travel party (orange, solid line) compared with three or more (blue, dashed line.) For those traveling alone or with one other person, the curve looks familiar, with the longest trips showing an approximately 12% share for the auto. Conversely, among those who travelled with two or more individuals, approximately 30% took the car for trips over 2,000 miles. FIGURE 3-8. AUTO MODES SHARE, BY TRIP DISTANCE AND PARTY SIZE Source: 2017 ACRP Survey Need for the auto at trip end, by distance Those who report that they need the flexibility of a car at the destination of the trip have a significantly higher propensity to choose the car, as shown in Figure 3-9. The minority of the sample reported that they do not need a car choose it as a mode, even for relatively short-distance trips. Among those who stated that they did not need a car, mode share for car continued to decrease as distance increased, up until a trip distance of approximately 1,700 miles. For trip distances over 1,700 miles, distance ceases to be explanatory, as the residual 10% of the group continued to choose the auto even with increasing trip distance. To the contrary, among those who stated that they needed a car, the relationship between trip distance and car mode choice behaves in a more linear manner, such that car mode share continues to decrease as distance increases. 0% 10% 20% 30% 40% 50% 60% 70% 80% 300-700 700-1100 1100-1500 1500-1900 1900-2300 above 2300 A ut o M od e S ha re One-way Trip Distance, in Miles Three + One or Two
48 FIGURE 3-9. AUTO MODE SHARE BY DISTANCEâNEED CAR VS. DON'T NEED CAR Source: ACRP Survey, 2017 Who is taking a multi-destination trip? Approximately 43% of survey respondents reported going to more than one destination on their reference trip. The reality of several âstopsâ on the trip has a profound impact on mode choice, such that 42% of our sample on a single-destination trip chose the car, but that percentage increases to 63% for those with multiple destinations (the average mode share for car was 51%). Figure 3-10 shows auto mode share by trip distance for travelers with single destinations and travelers with multiple destinations. Travelers with multiple destinations are more likely to be male, young, away for more days, and in a larger travel partyâwith more household members and more children. In addition, those traveling to multiple destinations are more likely to be to be traveling on business, which suggests that there may be two separate markets for long-distance multiple destination trips by car: one based on personal needs, and one based on business needs. The propensity for a given trip to have multiple destinations is highest in the lower-distance trip length categories (300â700 miles); this connection flattens for the rest of the distance spectrum at approximately one-third of trips (not shown). Who is traveling by car for the very longest trips? In the examination of the explanatory variables, increasing trip distance is associated with decreasing share for the autoâuntil approximately 1,700 miles, where the auto mode share remains near 10%. The price advantage of the car disappears at this trip distance; however, a consistently significant portion of the sample remains with the slower, multi-night auto trip. Clearly, some travelers continue to choose or need the car for these long-distance trips. For very long-distance trips (over 1,700 miles), compared to air travelers, the following tends to be true 0% 10% 20% 30% 40% 50% 60% 70% 80% 300-700 700-1100 1100-1500 1500-1900 1900-2300 Above 2300 A ut o M od e S ha re One-way Trip Distance Need Car Don't need car
49 FIGURE 3-10. RELATIONSHIP BETWEEN NUMBER OF DESTINATIONS AND MODE CHOICE, BY DISTANCE Source: ACRP Survey, 2017 for auto travelers: â¢ More likely to be male. â¢ More likely to be younger. â¢ Have less income. â¢ Have fewer years of education. â¢ More likely on a business trip. â¢ Have more people in the travel party. â¢ Have more household members in the travel party. â¢ Have more children in the travel party. â¢ Report more need for a car at the destination. â¢ More likely to be on a multi-destination trip. The last traveler behavior is important, as nearly 75% of respondents using the car for the trip over 1,700 miles were going to multiple destinations. By comparison, fewer than 25% of air travelers for this trip distance were going to more than one destination. 0% 10% 20% 30% 40% 50% 60% 70% 80% 300-700 700-1100 1100-1500 1500-1900 1900-2300 above 2300 A ut o M od e S ha re One-way Trip Distance Mulitple destination Single destination