Long-Term Market
Limited competition with commercial aviation
Our long-term forecast considers the impact that other technologies, including high-speed rail (HSR), have on air travel. In 2010, worldwide railways carried 45 percent less passenger traffic, but 45 times more cargo traffic than commercial aviation. The total distance covered by railway networks was a mere 2.5 percent that of the aviation network. Analysis of the data shows that (1) railways are well suited for carrying passengers over relatively short distances (terrain permitting), whereas aviation excels for longer journeys; (2) railways are an efficient mode for overland cargo transport; and (3) aviation is very effective for creating large transportation networks without heavy investment in infrastructure.
It has been almost 50 years since Japan introduced the world's first modern HSR service between Tokyo and Osaka. By the end of 2012, China will be operating 13,000 kilometers of HSR--more than the rest of the world combined. Yet, HSR still accounts for less than 2 percent of the world's railway lines, and only six nations have HSR networks with tracks longer than 1,000 kilometers.
Capital intensive, sizable life-cycle carbon footprint
China's unprecedented HSR program entailed a 2-trillion-RMB investment in a 13,000-kilometer network. In addition to the large capital investment, the infrastructure construction had significant impact on the environment. In 2009 alone, China's HSR program consumed 20 million tonnes of steel and 120 million tonnes of concrete. The carbon emissions associated with just the raw materials amounted to approximately 150 million tonnes of CO2--roughly equivalent to a quarter of the annual CO2 emissions for all the world's airlines. Yet, Boeing analysis shows that passenger traffic on the 2012 HSR network would account for less than 2 percent of the domestic revenue passenger-kilometers flown by Chinese carriers in 2009.
Intermodal strategies
HSR could compete with some airlines in high-volume, high-yield markets. Yet, the relatively short routes where HSR excels represent only a small portion of the market served by commercial aviation. Airline assets are highly flexible, because airplanes can be easily redeployed to more lucrative markets. In addition, the infrastructure investment for a comprehensive aviation network is much lower than for ground modes of transport. Aviation's network connectivity simply cannot be replicated by ground-based modes. Opportunities to develop intermodal solutions can potentially combine the advantages of both HSR and aviation.
