Forecasting Techniques for Air Cargo Forecasting and Air Traffic Forecasting In Changing Economic Environment

Abstract

Research on forecasting techniques for air cargo forecasting and air traffic forecasting is extensive and includes many studies that have tested alternative methods in order to determine which ones are most effective. In this paper, I had reviewed this evidence in order to provide guidelines for forecasting techniques for air cargo forecasting and air traffic forecasting. The coverage includes methodologies and assumptions involved in the current Air Traffic and Air Cargo Forecast, Air Cargo demand, Market Demand, Facility and Infrastructure Demand, Air Cargo Services and Other Supply Factors, Airport Traffic and Other Activity, forecasting techniques and models including Simple Growth Rate Model , Time series analysis, Econometric analysis, estimation of income and price elasticity's of passenger demand, Statistical Estimation of Model through example. Finally, Air Cargo Tonnage Forecast Summary and a case study of Indian Airports are also covered under Air traffic forecasting. Further, this paper also describes trend analysis, industry forecasts, and an econometric regression approach through example. This example illustrates the need for professional judgment in the forecasting process. In general, there is a need for statistical methods that incorporate the manager's domain knowledge. This includes Simple Growth Rate Model, Time series analysis and Econometric methods. The paper concludes that Cargo forecasts are important in understanding an airport’s demand growth, assessing market risk, and predicting financial gains/losses to develop management strategy. Airports that accurately forecast their future traffic will better anticipate the needs of their customers, and thus will be in a better position to develop to their full potential.