Thursday, June 09, 2011

Airline Fuel Bills

The fuel cost for a roundtrip flight from New York to Los is approximately $330. U.S. airlines burn an average of 22 gallons of fuel for every 1,000 miles each passenger flies.  The price of a domestic round-trip ticket this summer is forecast to be $430, on average. That includes taxes but excludes baggage fees and other services.

At $3.03 a gallon, airlines are currently spending $330 per passenger just on fuel for a 4,950-mile transcontinental round-trip. Some fliers might have paid less than that for their ticket while others could have spent more than $2,000.

A decade ago, fuel accounted for about 15 percent of airline operating expenses. Five years ago, it was 29 percent. Today, it’s 35 percent.

During the first three months of 2011, the airlines spent $8.7 billion on fuel, 31 percent more than last year. In the current quarter, jet fuel expenses are even higher.

The industry’s remaining expenses break down this way:

• Salaries and benefits account for 28 percent. Ten years ago, it was the biggest expense at 39 percent, but several major airlines filed for bankruptcy and that allowed them to renegotiate labor contracts.

• Aircraft maintenance, airport landing fees and travel agency commissions account for 18 percent.

• Aircraft lease payments, food and drinks and in-flight entertainment account for 5 percent. And that’s even with most airlines no longer serving peanuts.

• Another 14 percent goes to miscellaneous costs, such as updating reservation systems and marketing partnerships with other airlines.

Despite the rising fares and fees, demand for air travel is rising. The airlines expect 206 million passengers this summer, a 1.5 percent increase from last year, according to the Air Transport Association. (The Washington Times, 5/31/2011)

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