Goinv From United Kingdom, joined Jan 2005, 263 posts, RR: 2 Posted (8 years 8 months 2 weeks 2 days 23 hours ago) and read 3066 times:
Obviously an aircraft carries fuel according to it's weight and other factors such as weather etc.
Lets say the Captain of aircraft x has 150 passengers on board and takes 1000 gallons of fuel for the flight. How much extra would be needed if an extra passenger arrived late and made the total number of passengers 151?
The reason I ask is two-fold-
1) is it really economically viable for operators (like Ryanair) to charge £0.99 for a flight? Does the extra cost of fuel outweigh the charge for the journey?
2) On TV shows like Airline (in the UK) late passengers are denied boarding - the reason being that the fueld figures have already been calculated. Would it really make that much difference for (lets say) 170lb?
Thanks in advance
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Pihero From France, joined Jan 2005, 3820 posts, RR: 73 Reply 3, posted (8 years 8 months 2 weeks 19 hours ago) and read 2871 times:
Patroni gave an answer to your first question, to which I agree but it is just a ball park figure.
As to :"is it really economically viable for operators (like Ryanair) to charge £0.99 for a flight? Does the extra cost of fuel outweigh the charge for the journey?,
you'd need a book on airline economics .The following is a very simplistic explanation:
Let's say,for this demonstration that the cost for operating a 1 hr sector is 4,500 dollars for our hypothetical 150-seat aircraft.
You would break even if you sold all these seats for 30 $ each, so if you're sure of your market research,you 'd sell them at 31 $, making a hefty margin of 3.3% and you're going to be a very rich man.
Now,suppose that this sector will serve two more affluent cities,the population needs air travel,you've cornered the market and you're quite sure you will have on average 100 passengers ready to pay a bit more than 45 $ (the break-even tariff for 100 pax), let's say 48$. Bingo ! You have doubled your profit, you'll be rich twice quicker ...and...surprise :you still have 50 seats left that you could sell at the price you want ,even 1$ and thus increase your profit...the beauty of it is everybody will travel for one dollar and you won't lack of takers!
Now,supposing you've hired a very sharp VP finance who has the latest software and a genius as Advertising manager,you could sell some of these left-over seats for 30 $,some for 20... ad libitum...
That is in effect a very simplistic way of describing yield management.
Now for an aggressive lo-cost CEO, he would pass an agreement with the regional airport management by which they will pay him a fee for each traveller disembarking at their gate (drinks, meals, newspapers, sweets, parking revenues ...etc...etc...).
Last precision : the fuel extra cost on our example would be around 2 to 3 kg per extra passenger.