10%

lodging is to keep them dry it part of your international ble of taking the present-day dern day where all-inclusive avelers as well.

if you've got the empty room, vas there weren't empty rooms. make it as a part of your servravel agents in this all-inclusive ise they have to book a long way t fall, if there is a short fall, on

d in charters.

› go through Woodrow "Woodie" o move once in a while. This last ecognized that, and we luckily got gged all of them. They were flying eam on DC-3's that couldn't pass ere no charters available to take the Big Eight events.

not as easy, because I have had to all the persuasion I have to pay the for such movement of men and people

make a distinction in this part of our usly, regardless of who is setting up the "e set up in advance. The space for the nvolved are also done in advance. This spect to charters that are not composed e public through the inclusive-tour apset up and arranged for in advance as are concerned. We, as a scheduled carrier,

hey are the same. It has been varying lately, down to some degree. As I recall it, I would peak is roughly through mid-June and midtbound it is probably towards the end of of September.

This is where it is customary for Americans to l, is it not? It is varying now during winter generally speaking, you could say this is the ricans are likely to take their vacations, when Travel and various thingst kind, isn't that

viously be selling from a series of packages. He may find price distinctions between scheduled carriers to the same point.

With respect to Pan American's comments, I'm aware of the fact that in some cases the tours on the supplementals may be a bit higher than they are on the scheduled carriers, and the reverse may also take place, they may be lower than they are on the scheduled carriers. But the whole purpose here was to identify that the source of business that we are talking about is the public at large, and the individual members of the public, and the reference to individually ticketed services was to relate that to the real point at hand, and the source of that problem or let me say the source of the business at which we would all be going, and that would be the general public. Senator MONRONEY. I don't know why you seem to feel you are entitled to ticketing by travel agents and not the others. If I buy a ticket from TWA, as I usually do, or American, going any place, I usually get it from the TWA desk, if I can; if I'm in a hurry, I might get it from another agency over here. I would pay the same if I'm buying it from you, which results in 10-percent added profit to your line. I don't get that back, although if I buy it from a travel agent, the travel agent keeps it. This is part of the system, and I don't think you can have your cake and eat it too. If they are useful and inexpendable in a competitive world to you on selling your tickets, I don't see what's wrong with the travel agent originating a charter and then selling the tickets for that charter.

I'm surprised we don't have a lot of travel agents here, we had some give testimony of their position yesterday. They are concerned with this. They are the guys who merchandise both brands.

Mr. BARCH. To clarify that point, we do not object to the fact that travel agents do in fact sell a ticket. We are very happy about it, and obviously their share in the market in terms of sales is increasing each year. But I think the point there was in the cases of the scheduled carriers. They have the right to sell individual tickets against the scheduled carriers' flights, and in this case it is allowing the supplemental carrier to operate through a tour operator and his retail agents, or himself, in order to do the same thing on behalf of the supplemental carriers.

Senator MONRONEY. You've got two different markets, you've got two different types of people. I don't think I could bear traveling with 50 persons or they could bear traveling with me for 2 or 3 weeks abroad, because there is always a lot of gripe about this thing or that thing. We found it even on congressional tours. I like to pay a little extra to travel when I want to travel and come home when I want to. So, I just can't see that you have a thing to worry about. I appreciate your position. All I'm trying to say is the real matter is the allinclusive tour.

Hasn't TWA bought a lot of hotels now?

Mr. BARCH. We own the Hilton international chain, but those hotel rooms are open to the public at large.

Senator MONRONEY. I know, but this is the point. In a crowded period when you land a hundred non-all-inclusive people on a charter flight at any of these Hilton internationals-how many do you have? Mr. BARCH. I can't give you the last count, because one or two have just been completed. One was opened recently. Certainly it is in the neighborhood of 30-some-odd, or more.

Senator MONRONEY. You recognize that lodging is to keep them dry and warm and rested and it is an important part of your international operations, that the local hotels are incapable of taking the present-day planeloads. You're talking in terms of modern day where all-inclusive tours of the charters are important to travelers as well.

I'm sure you will take a charter flight if you've got the empty room, but the reason you had to go into them was there weren't empty rooms. You have to look far ahead, you had to make it as a part of your service, and as a part of the service of the travel agents in this all-inclusive tour I think it is just as essential because they have to book a long way ahead and I imagine pay for the short fall, if there is a short fall, on arrival, if they don't make the plane.

Mr. BARCH. We, too, are interested in charters.

Senator MONRONEY. I have had to go through Woodrow "Woodie" Thomas to get the football crowd to move once in a while. This last year you were too crowded and I recognized that, and we luckily got a local service line to help out. I begged all of them. They were flying the Oklahoma State University team on DC-3's that couldn't pass Federal inspection because there were no charters available to take the team to football games for the Big Eight events.

This charter-available thing is not as easy, because I have had to buck it for a long time, to use all the persuasion I have to pay the regular going rate for charters for such movement of men and people

that are necessary.

Mr. BARCH. I would like to make a distinction in this part of our discussion to this extent. Obviously, regardless of who is setting up the tour, these accommodations are set up in advance. The space for the hotel and the like if that is involved are also done in advance. This would equally be true with respect to charters that are not composed of individual members of the public through the inclusive-tour approach. Those, too, would be set up and arranged for in advance as far as hotel accommodations are concerned. We, as a scheduled carrier, hold out that facility in both cases.

In some of our scheduled group travel, sizes are reasonably substantial. They will vary, and it will all depend on the level of fare that is used to put together the tour. But that size varies, and those same requirements on space and the like are really there.

Senator MONRONEY. Is your peak about the same as Pan American on the North Atlantic?

Mr. BARCH. Generally they are the same. It has been varying lately, and it has been narrowing down to some degree. As I recall it, I would say that the peak of the peak is roughly through mid-June and midJuly eastbound, and westbound it is probably towards the end of August up to the middle of September.

Senator MONRONEY. This is where it is customary for Americans to find their vacation period, is it not? It is varying now during winter as well as summer. But generally speaking, you could say this is the general time that Americans are likely to take their vacations, when school is out, student travel and various things of that kind, isn't that correct?

Mr. BARCH. I would think, historically speaking, way back through steamship days and the like that the popular vacation period, if chosen by all concerned, would obviously peak everything into 1 month, more or less.

We, the scheduled carriers, have been through various fare inducements and the like gradually having the travel move at various other periods of the year, which is important to us in order to establish a viable economic position, and, to the degree that we have been successful, I think it fully reflects the ability of the passenger to maneuver some of his times and requirements.

We also know that winter vacations are now becoming more popular than they have been in the past.

One other thing. I noted from the statistics that were quoted that a certain number of the people that were sampled were within a certain age bracket, and I think that is indicative of the time the sample was taken, because it happened to be in the first quarter, or whenever

it was.

Senator MONRONEY. Will you put in the record the load factors during these peak months that you mentioned? If you will send those to us for the record.

Mr. BARCH. Yes.

(The information requested follows:)

TWA TRANSATLANTIC PEAK SEASON LOAD FACTOR

Senator MONRONEY. You have been very helpful to the committee. We do appreciate your kindness in appearing before us.

We are honored to have Mr. Lucian Hunt, president of American Flyers Airline Corp., Ardmore, Okla.

Mr. Hunt comes to us with vast experience in the airline industry. He established the great safety record as the chief of maintenance of all of the vast American fleet from the DC-4 days, I guess, to the 707's and the 727's and the BAC-111's.

We are happy to hear your testimony. We regret we have run so long, but we are trying to get all around this subject and be sure that all sides have ample opportunity to express themselves.

STATEMENT OF LUCIAN HUNT, PRESIDENT, AMERICAN FLYERS AIRLINE CORP., ARDMORE, OKLA.

Mr. HUNT. Thank you, Mr. Chairman.

My name is Lucian Hunt. I am the president of American Flyers Airline Corp., and I am representing the airline today. We are a U.S. certificated supplemental air carrier.

Mr. Chairman, because of the uncertainty of my appearance here and my inability to be here yesterday, I have no prepared statement; so, I will make extemporaneous remarks for the record.

I have had an opportunity to review the testimony before the committee yesterday, and I was encouraged to see the favorable response from the Government agencies, specifically Chairman Crooker of the CAB, and from Secretary Agger, the Department of Transportation, and also from Glenn Cramer, president of the National Air Carrier Association.

American Flyers is not a member of the National Air Carrier Association, and I want for the record today to strongly endorse the proposed Senate bill, S. 3566, and the position that has been expressed by Chairman Crooker of the CAB.

I am advised this morning that the National Association of Air Carriers has formally endorsed the CAB position on this bill. Our airline takes the position of equally strong support of the CAB position.

American Flyers Airline is a small supplemental carrier. We are small in the sense of comparison with World and TIA. Last year we did about $10 million in revenue and this year we will do approximately $15 million. We find ourselves at this stage in our growth, although we have existed as a carrier for more than 26 years as a charter specialist, in a very critical period in assimilating growth in the transition from pistons to turboprops and to jets.

We have retired all of our piston equipment and we now are incurring the development and transition problems and the expense of such transition into the more modern equipment. We are operating five Electras and two 707 convertible jets.

We see, from review of the testimony this morning that was heard, numerous paradoxes in the positions that are taken by the large trunks, scheduled carriers. I would like to point out some of these that appear to me to be a paradox.

I have heard that there is much argument relative to inclusive tour authority being tantamount to ticketed services, individually ticketed services. I cannot understand this contention. In my lay knowledge of what is individually ticketed service, I understand that it is purely transportation from point to point sold to an individual. I cannot understand why inclusive tours which can only be sold as packages which include much more than the transportation and which is more than from point to point, I cannot see the classification of the subject that is being argued before your committee, and I feel it is irrelevant to the discussion.

There are other paradoxes which come to my mind, and one is that there is a contention of a serious competitive thrust from supplementals relative to diversion of business from scheduled carriers. I would like to point out, and these are statistics that are well documented, in 1966 the supplementals carried only 3.6 percent in terms of revenues of all transportation sold by all U.S. carriers, both domestic and international and local service carriers. That increased one-tenth of a percent in 1967 to 3.7 percent.

It is difficult to then see and understand the contention that we are a serious competitive threat to these larger, successful carriers.

Another paradox is the fact that being on the other side of the fence today from where I was 2 years ago, with a large trunk, nearly 10 years ago we began our transition from pistons to jets, and now the successful scheduled trunks who are opposing this legislation are be