Page 189 - Planning and Design of Airports

156 Airp o r t Pl anning

The inability of time series techniques to show a causal relation-
ship between the dependent and independent variables is a serious
disadvantage. This is particularly true because, in the absence of such
relationships, the degree of uncertainty in such forecasts increases
with time. However, the time series method is useful for short-term
forecasts in which the response to changes in those factors which
stimulate the dependent variables is usually less dynamic. In those
cases where cyclic variations may be expected to occur, time series
methods may also be quite beneficial.

Market Share Method
Forecasting techniques which are utilized to proportion a large-scale
aviation activity down to a local level are called market share, ratio,
or top-down models. Inherent to the use of such a method is the dem-
onstration that the proportion of the large-scale activity which can be
assigned to the local level is a regular and predictable quantity. This
method has been the dominant technique for aviation demand fore-
casting at the local level and its most common use is in the determina-
tion of the share of total national traffic activity which will be captured
by a particular region, traffic hub, or airport. Historical data are exam-
ined to determine the ratio of local airport traffic to total national
traffic and the trends are ascertained. From exogenous sources the
projected levels of national activity are determined and these values
are then proportioned to the local airport based upon the observed
and projected trends. The ratio method is most commonly used in the
development of microforecasts for regional airport system plans or
for airport master plans.
These methods are particularly useful in applications in which it
can be demonstrated that the market share is a regular, stable, or pre-
dictable parameter. For example, the number of annual enplaned
passengers at major air traffic hubs has been shown to be a consistent
and relatively stable factor and, therefore, this method is often used
to predict this parameter.
Quite often the application of the market share technique is a two-
step process in which a ratio is applied to disaggregate activity fore-
casts from a national to a regional level and then another ratio is applied
to apportion the regional share among the airports in the region.
The most compelling advantage of the market share method is its
dependence on existing data sources which minimizes forecasting
cost. However, its principal disadvantages lie in its dependence on
the stability and predictability of the ratios from which the forecasts
are made and the uncertainty which may surround market shares in
specific applications. Several forecasts may be required under a differ-
ing set of assumptions which are deemed appropriate to the determi-
nation of market shares. An illustration of the application of a market
share analysis is given in Example Problem 5-2.