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HELICOPTER AIR SERVICE PROGRAM     419


The foregoing analysis of relationships between transportation revenues and total operating expenses indicates that considerable progress has been made since the introductory phase of helicopter passenger operations. Of the greatest significance, however, is the recent progress which has been made in 1963 under an expanded operation with larger, turbine-powered equipment. Had the NYA accident not occurred in October it is possible that subsidy in Calender Year 1963 would have accounted for only a little more than 50 per cent of LAA and NYA total operating revenues. This would have been considerably below that of other years (see Table III-21, page III-22). 

Substantial progress has already been shown by the operators of new equipment. For NYA, the per cent of subsidy in total operating revenues dropped to 43.8 per cent in the 2nd Quarter of 1963 as compared with 65.8 per cent in the same period in the year previous. For LAA, the decrease was from 67.8 per cent to 54.6 per cent in the same period. 

Nevertheless, a dependence on government subsidy support for half of their operating revenues indicates that considerable economic progress must still be made before the carriers can exist on their transportation revenues alone. In this regard, it is significant to note the progress whcih has been made by the local service industry. Ten years ago, after an initial development period of roughly five years, US mail payments accounted for roughly 50 per cent of the industry's revenues. Today, subsidy accounts for roughly one-third of local service revenues. 


Public Benefits from Commercial Helicopter Operations

Before turning to the outlook for vertical-lift aircraft in their present role in providing airport transportation it is necessary to give some consideration to the relationship existing between the costs to the Federal government of providing this service and the benefits which have accrued to the public as a result. 

In the period 1954 to date (12 months ended June 30, 1963) the helicopter carriers received a total of $41,686,000 in subsidy support from the US government. In the period prior to 1954, when there was no separation of subsidy from service mail payments, the carriers received a total of $6,190,000 in mail payments. Although the carriers performed some mail services in return for these payments, the bulk of it must be considered as subsidy support. In total, then it has taken an investment of approximately $48 million in public funds to bring the original helicopter experiment, which involved only the carriage of mail, to its present stage of development in expediting air passenger transportation. 

The benefits from this investment of public funds are both direct and indirect in nature. The direct benefits are those accruing to the traveling public, to the US mail service and to the shippers and receivers of high-priority freight and express. Direct benefits can be measured in terms of traffic units—numbers of passengers, passenger miles, ton miles—and these have been shown in preceding sections of this chapter. 

At the present time the direct benefits of helicopter service accrue to approximately one-half million passengers annually. However, these direct benefits are available to users of our national system of air transportation in general and not just to residents of those metropolitan areas where helicopter services are located. Subsidized helicopter operations are provided at airports which represent the three largest traffic-generating segments of the US air transportation system. Airports in the New York, Chicago and Los Angeles metropolitan areas account for 25 per cent of all domestic passengers enplaned at all US airports. These airports are the destination points of air traffic coming from nearly every US city certificated for scheduled commercial air service. 

During the course of this study a questionnaire survey was made of the characteristics of passengers who use present helicopter services. The primary purpose of the survey was to determine passenger opinion as the present helicopter services but questions were asked also as to place of residence and the origin and destination of air journeys.


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