New Spokane International Airport Master Plan
May 24, 2011 Leave a comment
Today, SIA will host an open house to discuss the draft of their newest Master Plan.
Forecasting is an attempt to predict the future. Management must necessarily make assumptions and guesses about the future, even though predicting the future is usually not possible. SIA has used a variety of standard methods to create their forecast, and this may come as a surprise based on my past reports, but I agree with their methodology – they have done an excellent job with this.
Here is a chart showing actual passenger enplanements (passenger boardings) from 1990 through 2010. The curve from 2011 to 2030 is the new forecast produced by the airport. The data for the above chart comes from their Draft Report.
Even better is this chart from the Draft Report showing the different forecasts produced using the different methodologies. This chart is better because it helps us understand the range of potential possibilities. As you can see, the projections span a range from a minimal increase to a doubling.
- From 1990 to 2010, SIA had a compound annual growth rate of 3.42%.
- ALL of that growth took place in 1991 to 1996.
- From 2000 to 2010, they had a “Compounded Annual Growth Rate (CAGR) of 0.39 percent”.
- For the period 2011 through 2030, the range of forecast CAGRs extends up to about 3.4%.
- The new forecast moves the 3,000,000 passenger threshold from about 2018 (the old forecast) out to about 2028. That is a significant and important change.
Obviously, they (and we) hope for better results in the coming years than in the past 15 years of flat passenger enplanements!
Local promoters and media will run with the maximum forecast calling for a doubling of passengers over the next 20 years (they already have). SIA’s passenger count did double during the preceding 20 years, but only because of 1990-1996. It’s fair to say that the forecast range is up to a doubling of passengers, but a little unfair not to mention the rest of the story … it might also be a lot less.
Previously, I showed that SIA’s year 2000 forecast was out of date the year it was issued:
Forecasting is a magic art – some times you get lucky and sometimes you don’t get lucky. The problem was not that the forecast was off but that previous management did not seem to notice and revise that 20 year plan until ten years later (2010-2011)! Forecasts are seldom right – the problem was the lack of management followup!
The new SIA director will be comparing the forecast to reality every year and making adjustments as needed. I hear he is detailed oriented and pays attention to data and data analysis.
Passenger boardings are an important economic indicator, especially for an isolated airport like SIA. As shown elsewhere on this web site, SIA (and hence Spokane’s economy) appears to have lagged behind other PNW airports such as Boise and Seattle during the recent downturn.
And once more, congratulations to SIA on their excellent forecast methodology and detailed report. Several other government agencies could learn from these folks!
My only recommendation/comment to their forecast is that they do what they can to educate local promoters and media to accurately report on the range of possibilities, and discuss how they will monitor real world results compared to the forecast.