Decoding Airline Profit: How Much Do They Earn?
I have always wondered what kind of profit the airline you travel on makes. One would think that it must a large profit because of the fuel, personnel and cost of the aircraft. But, a recent study from the US Airways group provides an astonishing revelation.
So, in a typical flight with 100 passengers, each paying $164 on average (one way fare), about a third of the those seats cover the cost for fuel, or 29 seats. another third or 34 seats, cover the costs of salaries and various governmental fees etc. The remaining seats, 36 seats cover the costs of maintenance and business costs. The single remaining seat is the profit to the airline, or $164.
Airlines with larger aircraft and for longer flights spend even more on fuel. About 10 years ago, the average aircraft burned 29 gallons per passenger, in 2010, it is now 23 gallons. During this same time, fuel costs tripled to $32 billion!
So, if you travel and are angry about the "nickel and dime" passengers pay for luggage, extra weight, food, cancellation fees and more, just know the airlines are not making a killing on a flight with 300 people traveling to Germany or just about anywhere else.
Comments
Airlines around the world are mostly losing money or barely held even. I believe I read somewhere (IATA?) that worldwide airline profit is under 1%. The only bright spot is in the so-called low-cost carriers like Southwest who manage to squeeze out efficiency by operating identical fleet (as much as possible) and very efficient flight turnaround.
Interesting information....although I thought I read somewhere that Ryan Air made a profit of 250 million last year. Can this be so for such a low cost airline?
- Author
Good question.