More Effective Use of Contract Airlift Could Reduce DOD Transportation Costs

GAO reported on the Department of Defense's (DOD) use of aircraft under contract from commercial air carriers.

GAO found that DOD is losing millions of dollars annually because of empty seats on aircraft under contract from commercial carriers. The Military Airlift Command (MAC) spent $228 million in fiscal year (FY) 1981 and about $250 million in FY 1982 to airlift military and civilian personnel on contracted international flights. GAO found that a significant number of empty seats existed on these flights. There are two major reasons for these empty seats: (1) passengers did not show up for flights as scheduled; and (2) the services apparently did not generate the volume of passengers anticipated at the time they submitted their requirements to MAC. In FY 1981, the no-show rate was 13.5 percent. In FY 1982, the no-show rate climbed to 14.7 percent. GAO estimated that empty seats caused by no-shows cost $13.5 million annually. This savings estimate was reduced to give consideration to overbookings and passengers who walk in and actually use seats that were intended for use by no-shows. In addition, GAO estimated that underutilization of seating capacity for reasons other than no-shows cost DOD another $13 million annually. At present, if authorizing orders are issued, military personnel have the option of buying tickets with their own funds, with subsequent reimbursement not to exceed the MAC tariff rate, which leaves empty seats on MAC flights.

Recommendations

Our recommendations from this work are listed below with a Contact for more information. Status will change from "In process" to "Open," "Closed - implemented," or "Closed - not implemented" based on our follow up work.

Director: Nancy R. Kingsbury Team: General Accounting Office: National Security and International Affairs Division Phone: (202) 512-4268