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Nowadays, people don’t know much about airlines and for most of them an
airline is associated with flying from one point to another or either expensive
fares. Airlines are a complex business to investigate, but in this work i
diveded this topic into 2 part: airlines as a business (,,back’’ things that
ordinary customers don’t know, for what you pay when traveling and how
airlines work in term of money) and airlines as customer related field of
work. When people search for a ticket, all that they think about is that airlines
offer exaggerated prices, that is 50% true but there are always alternatives
depending of your conditions to travel. Also customers think of flight
attendants are waiters in air and don’t know that flight attendants can save
their life.
Objectives:
Is flying expensive?
The Airbus A320 Neo can carry 6400 gallons of fuel, that’s the equivalent
of 376 fully tanked Toyota Camry’s. For flying 213 miles from New York to
Washington DC, our plane need 317 gallons of fuel. With that amount, our
Toyota Camry could drive fron New York to Los Angeles 49 times, but we
need to consider that a Toyota seats 5 persons, but and A320 seats 154
people.
Fuel
So, assuming that our plane is fully loaded, it now has a per person fuel
efficiency of 104.7 mpg. According to the Bureau of Transport Statistics
airlines pay on average only $1.24 per gallon. So flying for New York to DC,
you personally only use $2.50 worth of fuel, but why a ticket costs upwards
of $80?
Crew costs
First thing we can add to our ticket prices is crew-costs, so $240(for 2 pilots
and 4 flight attendants) / 154(fully loaded plane) = $1.50 per person.
Airport take-off and landing fees.
Next thing are airport taxes. New York’s John.F.Kennedy Airport charges
$6.33 per thousand pounds of airplane taking off. Our plane weights 172.000
pounds, so 172.000 x $6.33=$1089/154=$7.00 per person(including gates,
boarders and other airport resources) + $7.00 to Dulles Aiport in Washington
for landing fee, in total $13.50.
Taxes
There’s a bunch of different taxes and they all vary by country, so for the
sake of simplicity i will just cover the ones for the US. The Simpletest tax is
the Domestic Passenger Ticket Tax at 7.5% of the ticket price($6.00) that
goes to Federal Aviation Administration plus the Domestic Flight Segment
Tax around $4.00. The US Departament of Homeland Security charges $5.60
tax called 9/11 security fee and in total $15.60.
Airplane Maintenance
Airplanes are expensive, our plane costs $107.000.000 and the service life
for airplanes is not actually determined by flying time, but by flight cycle that
means one flight and how many times a plane was pressurized. Our A320 can
fly up to 60.000 cycles, so if we divede the total cost of the plane by flight
cycles, we get $1783 per flight and dived per person it’s $11.5. To keep this
plane safe, airlines have to perform regular maintenance, for a hour flight,
airline has to do maintenance that will cost $646 in labor, $276 in parts, $603
in inspections and $596 in engine restoration, that’s $2121 in total or $14.00
per person.
Non-flying part of flying
Every flight is operated by an airlines which is a businees that has costs in.
They need to pay their staff including administrators, executives, engineers
and so on. It’s hard to say exactly how much per person this works out to, but
i will estimate it to $10.
Total
Our total is $68.6 and i will estimate to $70 to cover small things as(plane
insurance, plane storage, airport staff). That means that there is a profit of
$10, but keep in minde that all costs are made on a fully loaded plane.
Conclusions
Is flying expensive? Well it depends, but it is getting cheaper. To fly across
US from New York to Los Angeles in 6 hours cost $340 round trip. To drive
our fuel efficient Cambry across the country in 40 hours costs $340 just for
fuel and additional $200 in maintenance and depreciation costs. In the past 30
years, the average inflation adjusted airfare dropped by 50% and it’s still
dropping . In 1974 it was illegal to fly for NY to L.A for less that $1442 and
now we can find this less that $200. One of the reason for dropping prices are
rise of efficient airplanes have driven down the cost of flying
How budget airlines work
Budget airlines work in North America, South Africa, India, Asia and
plenty of other places, budget airlines were really first successful in
Europe and that’s where they are still proeminen today.
Budget airlines in America
The way that budget airlines reduce the cost of a ticket is much more
visible than in US. Budget airlines in the US might be 10 or 20% less
expensive than thei traditional competitors.
(Price comparing on route Edinburgh to London Stansted between Ryanair (low cost airline) and British
Airways(national career of UK))
Flight attendants
Flight attendants on budget airlines are often in the beginning of thei careers
and receive little training, of course they will get the required safety training
but only minimal hospitality training. They also serves multiple roles while
on the ground, so someone can be at the gates while others clean the airplane
and through this, the airlines eliminates 3-4 position that thet regularly would
pay for. Also on-board service can be an excellent way for the airlines to
make money, as they are never free.
Airports
You will never see Ryanair fly to London Heathrow or Paris Charles de
Gaulle because this airports are expensive, instead they fly to Gatwick,
Stansted or Luton in London or Beauvais in Paris, which is 80-minutes bus
ride away from Paris and even it’s not located in Paris, so budget airlines are
the only that are flying out of an airport like this which gives them a huge
negotiation power. Often they will take a small regional airport away from
city and rebrand it as another city airport and they can ask for lower landing
and takeoff prices, and if the airport doesn’t comply they will leave and the
airport will essentially cease to exist.
Point to point model
Most traditional airlines have hubs where most of all their flights go in and
out. British Airwars has London, Air France has Paris, KLM has Amsterdam.
To get to most places on these airlines, you have to connect through their
hubs, budget airlines, on the other hand, try to have a lot of destinations from
everywhere. For example, to get from Iasi to Amsterdam you need to connect
through Bucuresti Otopeni International Airport on TAROM, but to get from
Iasi to Thessaloniki, Greece you have a direct flight with Wizz Air.
Ticketing
Speaking of ticketing, there is often no way to get a real ticket from a real
person on a budget airline, for example Ryanair charges 30 EUR if you fail to
print your boarding pass at home and EasyJet and some of others carriers
have almost their check-in’s handled by machines, that cuts down on
personnel costs.
The five freedoms of aviation
Behind any flight there are more than one century of political negotiation, accords
and documents that dictate who, how and where airlines can fly. The beginning of
aviation agreements came with the 1944 Chicago Convention on International
Civil Aviation. This convention established the International Civil Aviation
Organization. This organization is recognized by every country worldwide expect
for Liechtenstein, Dominican Republic and Tuvalu. After ICAO launched 5
fundamental rights of aviation, known as Five Freedoms of the Air. Each freedom
has varying levels of acceptance, but every developed country offers this rights to
certain airlines.
(Ryanair Travel Map, flight from Stockholm. Cities that are marked as red are Ryanair hubs)
Responsabilities
1. Briefing(before every flight crew meets for a briefing. Briefing is a meeting
where the crew meets, analyze flight information, they go over safety
checklists).
2. Check emergency equipments(oxygen masks, vests, first aid kits).
3. Assist the cabin between flights(flight attendants don’t clean the cabin,
there is a special service in airport, but they are still involved in cleaning the
aircraft, for example flight attendants clean the toilet, make sure the water
flush and flows from the tap).
4. Depending on the aircraft type crew demonstrate the use of safety and
emergency equipment.
5. According first aid(to help a person with a bleeding nose, illness, intoxicated
or anxiety striken passengers, also they are teached an emergency training
that includes rejected takeoffs, emergency landings, cardiac and in-flight
medical situations, smoke in the cabin, fires, depressurization, on-board
births and deaths, dangerous goods and spills in the cabin,
emergency evacuations, hijackings, and water landings).
6. Serving meals or sometimes sell goods on board.
7. Ensure all passengers have seatbelts fastened and ensure other safety
requirements are met.
The majority of people answered with ,,No’’(27 out of 39) at the question if they
would like to become a flight attendant. This is because of the reason that flight
attendant job isn’t popular among the jobs that are required on market nowadays
as economists, lawyers or doctors.
The third category are students that said they have flown with another companies
that were not mentioned, among this companies is Emirates, that doesn’t operate
flights from KIV, Lufthansa and Austrian.
The fifth question was ,,In your opinion, what are the obligations of a flight
attendant?’
Students answered differently on this question. The most common answer is that
flight attendant is obligate to provide comfort to customers, this is right but is not
the most important duty of a cabin crew. It is common for customers to think that
the only obligation for the staff of the plane is to serve food, but that is too far
from the truth. The main obligation of a flight attendant is to secure passengers
and assure safety on board of an aircraft, and as you can see only 10 out of 60
students chose safety, being an example that people are not informed correctly
about the main purpose of a cabin crew on board.
She reveals that passengers often bought life insurance from vending machines.
She told WJLA-TV: "When it started I think it was $12 (£9) one way. Being a flight
attendant wasn’t easy because they were restricted regarding their weight and
height. She also said : “You put on a few pounds and then you had to keep
weighing yourself, “And then if you stayed that way, they would take you off the
payroll.”
Conclusion
Airline industry is a well growing branch of worldwide economy. Every day it’s services are
demanded by customers. Nowadays there is a trend that is opposite to the past. Customers
choose to fly cheaper, not luxurious and that is why low cost airlines monopolizes the airline
market. The global spend on air transport last year was almost $750 billion. Even with more than
three billion people flying annually, the industry also experienced an overall reduction in airfares
of almost 4%. As a result, the pressure for you to realize true revenue growth has never been
greater. Aviation provides the only worldwide rapid transportation system which makes it
essential for global business and tourism. Aviation’s total global economic impact is $2.7 trillion
including direct, indirect, induced and the catalytic effects of tourism, it transported
approximately 3.6 billion passengers in 2015 and carried 51.2 million tonnes of freight in 2015 and
35% of interregional exports of goods by value. Daily value of goods sent by air is now $17.5 billion
and 54% of international tourists travel by air. Passenger airlines are airlines dedicated to the
transport of human passengers. In 2017, global air traffic passenger demand is expected to
increase by 7.4 percent and generate around 743 billion U.S. dollars in revenue. Some of
the largest airlines worldwide include: American Airlines, Southwest Airlines, Delta Air Lines,
Deutsche Lufthansa, United Intercontinental Holdings, China Southern Airlines, and Air France-
KLM. In 2017, American Airlines was the airline with the highest brand value, closely followed by
Delta, United and Emirates Airlines. Emirates had an estimated brand value of just over six billion
U.S. dollars.
As a result of increasingly affordable flight rates and cheaper oil prices, passenger and cargo air
traffic are estimated to grow substantially through 2036. Latin America is the region
where passenger air traffic is expected to experience the highest growth rate. Between 2017 and
2036, the airline industry is projected to increase its carriers' revenue passenger kilometers by
about 4.7 percent. Commercial airlines stand to greatly benefit from the increased passenger
demand in global air traffic. In 2016, there was a 7.4 percent growth in global air traffic passenger
demand. The same year, commercial airlines worldwide generated combined revenue of 705
billion U.S. dollars. The United States is home to the world’s busiest airport: Hartsfield-Jackson
Atlanta International (IATA:ATL) enplaned more than 46.7 million passengers in 2016.
Surprisingly, the United States scored a mere 6.1 in the 2016/2017 air traffic infrastructure quality
ranking published by the World Economic Forum. Meanwhile, Singapore’s air traffic
infrastructure received a rating of 6.8 on a scale of 1 to 7, with 7 being the highest rating possible.
Annexes
1.Have you ever flown?
a)Yes b)No
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a. Yes b. No
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5. How do you think, does this job offers the travel benefit? If yes, please explain, if no also
explain
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6. Would you work as a cabin crew? If yes, please explain, if no also explain
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https://www.statista.com/statistics/278372/revenue-of-commercial-airlines-worldwide/ -
Statistics about the revenue of commercial airlines worldwide from 2003 to 2018 (in
billion U.S. dollars).