How bad is the airline biz?

American is charging as little as $390 round-trip between NY and L.A. - and the airline is spending nearly $500 per passenger for fuel. Now, I'm not exactly a math whiz, but that doesn't seem like a very good way to make money. And as the WSJ's Scott McCartney points out, that's not even factoring labor, airplanes, maintenance, insurance, landing fees and facilities.

Since oil began its dramatic climb in 2004, airlines have been scurrying to fly more fuel-efficiently. They have installed winglets on jets to improve performance and trimmed weight by eliminating magazines in cabins and carrying less fuel above required reserve levels, among other measures. They fly at slower speeds and check the skin of airplanes for dents that would increase drag. Reducing flight delays also helps -- since planes wouldn't sit around or fly circles in the air as much. Buying or leasing new jets that are more fuel-efficient is also an option. Discouraging passengers from bringing baggage because of high fees might provide some fuel savings by reducing weight, but not if travelers simply stuff more into carry-on bags and cram them into overhead bins.

The NYT weighs in on fuel-saving efforts by airlines:

Even specks of dirt are considered culprits. American and Southwest are washing a handful of jet engines each night, a process that used to happen only during thorough maintenance overhauls. Southwest figures it has already saved $1.6 million in fuel costs since April by reducing the drag caused by dirt and debris. American, for one, expects to save roughly $330.7 million this year, or about 3.5 percent on a total fuel bill that will approach $9.26 billion.

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Mark Lacter
Mark Lacter created the LA Biz Observed blog in 2006. He posted until the day before his death on Nov. 13, 2013.
 
Mark Lacter, business writer and editor was 59
The multi-talented Mark Lacter
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