Why do the airlines always seem to run on such a small profit margin

True and entirely irrelevant. His personal experience says absolutely nothing about the tens of millions of passengers in the industry as a whole.

The fact is that all flights are not full. Some can be almost empty. As a whole 1 in six seats go unfilled.

That might actually be capacity. There is no possible way to get every seat filled on every flight. Many flights in small markets and non-hubs need to be maintained without ever filling up. (And that’s not even including the very small markets subsidized by the government.) There is a percentage less than 100 which is the realistic maximum. The percentage didn’t go up between 2013 and 2014 so we may be very close now.

That the plane headed for the University of Southern North Dakota at Hoople is leaving only 1/3 full has no impact on people flying major routes. Since the return flight is no doubt feeding people into full flights at hubs, I agree that they are probably near an optimal schedule and load now. The airlines have enough computers doing scheduling and load optimization, after all.

Our travel agency audits costs, and sends nasty messages when policy has been violated. We get to keep our miles, btw.
On the other hand, the price of a business ticket is not the only metric, since many large companies use the volume of traffic they send to an airline to negotiate price deals (or kickbacks) - so the cheapest flight for a department budget might not be cheapest for the company as a whole. The same thing goes for hotels.

by state I meant nation state, not local state, e.g., USA, Canada, New Zealand, etc. Sorry for the ambiguousness of my wording.

Interesting. For us the law is effectively “thou shalt not run out of fuel!” This is backed up by an “advisory publication” that sets out some acceptable methods of complying with the law. The AIP also has some rules about when you do or don’t have to carry an alternate or holding fuel etc. In addition to all that the company has a fuel policy as part of their manuals. As this manual is approved by the aviation authority (CASA), the fuel policy in it is taken to be legal even if it differs from the contents of the advisory publication.

Anyway, with that said, our company policy is for a 30 minute fixed reserve with some further stipulations related to planning requirements. Most of us like to have a bit over an hour in reserves on a nice day but won’t get too concerned if it’s closer to 55 minutes. Others are more conservative. On some of our aircraft, if we land with more than an hours fuel we are eating into the payload so we are basically forced to have an hour at the most unless the fuel policy dictates more fuel.

I agree with these statements, but it seems like there is definitely a forgotten middle. The premium economy class has not been well executed by airlines in the US. I can fit my ass into a 17" width seat but I can’t change the width of my shoulders. My legs are freakishly short for my height so legroom isn’t an issue, but seat pitch in general is nice to have.

I’m not a frequent flyer, maybe 3-5 trips per year (combined business and personal) but I would definitely pay more for a worthwhile premium economy seat. The problem is that the airlines in this country don’t offer an economy premium configuration that’s worth it to me. Jet Blue has the most comfortable economy seats in my opinion and experience and I will always pay more to fly with them over their competitors when it’s practical to do so, but I do wish every airline offered more in the way of a true middle ground between economy and first class.

Railroads never made much money on passenger service either, right? I think it’s the nature of the transport industry – lots of fixed costs but variable revenue.

Premium economy works fairly well on long-haul wide-body domestic flights. But that’s only about 10 city pairs in the US.

As I said upthread, the challenge for narrow-body aircraft is that to introduce the greater width everybody wants, we have to cut back from six seats across to five. Which requires at least an 18% price increment. The market will NOT pay that.

I’ve read that business class tends to be more profitable than coach. Is this true, for a given area of the plane?

Are there airlines that specialize in business-class-only travel?
Are there regulations that would prevent seating that faces perpendicular to the plane rather than parallel? How about benches instead of individual seats?

There are regs about crashworthiness of seats & seatbelts. I doubt there’s a specific prohibition against transverse seating, but it’s probably impractical to do it and also meet the safety regs. Having said that, the standard seats in military transports for moving troops, especially paratroops, are arranged sideways. But totally different safety regs apply.

There have been airlines which specialized in business class-only. None have survived in that format much past their start-up stage. Having said that, there are some specialized airlines which are ultra-luxo. Like a 767 with 50 seats, not the typical 250 seats. They run very restricted routes, like NYC - Las Vegas or NYC - London. And they cost a lot more than ordinary major airline first class.

Business class *when occupied with full-fare passengers *tends to be more profitable per square foot of floorspace than coach is. But don’t mistake that for true profitablityu. A lot of folks in business class are paying a very small charge for an upgrade or are burning frequent flyer miles to be there. So they’re not paying the full load.

Also, again the market in almost all city pairs simply doesn’t support enough business class seats to support an all business class airplane.

There are two routes in the USA which do support the mainline carriers offering a very different experience: LAX-JFK & SFO-JFK. Check out the websites of the name brand airlines and you’ll see things like airplanes that normally have 150 first + coach seats which instead have 30 first class international lie-flat beds, 40 almost lie-flat international business-class seats (i.e. nicer & more spacious than most domestic first class seats), and only 20 coach seats with much extended legroom. And that’s it. The fares are eye-watering, but the elite of America are glad to pay it.

Just read that Delta has a set of private jets , like Lear jet size. And they are now trying to get more people to fly on them rather than leave empty seats. So they are offering people upgrades to fly on those smaller jets. They are mostly offering these upgrades to people who fly a very high number of miles on Delta already so the average person will not get the upgrade.

Actually, you said it in a different thread but I’m not sure where 18% is coming from. One seat out of six is 16.66% of the total and the differential of five seats paying for the missing sixth is 20%. I do appreciate your post, because I never really thought about dividing the seats as such.

There’s simply no practical way to divide six seats into five in a section of the plane. You would have to configure the entire aircraft that way. I agree that the market would not support a full plane at a 20% premium for an extra three or four inches of shoulder room. To configure a section at 3/2 you would have to dogleg the aisle which would not only be a pain in the ass (especially for flight attendants) but cost even more seats.

It seems that seat pitch is the only thing that airlines can really sell as premium space on narrow-body aircraft. I guess I should be thankful for my short legs saving me money.

That’s how the division between first and economy classes works on some planes.

Part 61 covers training, Part 91 is private flying.

18% comes from me mis-remembering what 1/6 is in decimal. :o

So as you say it’s actually the case that pulling one seat out of a row of 6 is a 16.66% reduction in seat count that results in a 16.66% reduction in revenue if no upcharge is taken. And the upcharge on the 5 remaining seats needs to be 20% to make the change revenue neutral.

I’m not trying to hijack the thread but there is a difference between the airlines and the railroads.

My husband’s grandfather worked for the PRR, and he always said that the freight transportation that made the railroads (extremely) profitable, allowed them to offer the passenger service which was a loss-leader but an effective advertisement for the railroads.

Unless I’m really wrong, the passenger airlines don’t function that way. I don’t think the major airlines have freight service in the sense that the railroads did.

I’m not sure anyone has brought this up, but with the airlines I think some of the problem is that flying has become a much more common means of transportation than it used to be. In the 1960s, you would dress in your good clothes if you were wealthy and/or lucky enough to be flying to a destination. There were many fewer destinations and many fewer flights to those destinations.

Now people expect there to be a flight to anywhere they want to go, at any time they want to go. The airlines are trying to spread themselves awfully thin to at least give the illusion they’re providing that kind of service.

Southwest has definitely hit on a successful formula! They are serving more large airports now, but in cities like Atlanta with only one major airport, what choice do they have? And in other large cities, such as Los Angeles, they serve multiple airports now- LAX, Burbank, Ontario & Orange County/Santa Ana.

But they continue to do what works- sell every seat on most flights, focus on on-time departures/arrivals and giving flyers a great value. I’ve been using them since they started service out of Atlanta in 2012 and I love them. I also love the two free checked bags! I’m flying from ATL to LAX at the end of August and I paid $167.99 round-trip (plus $12.50x2 for Early Bird Check-In, to get a chance at my choice of seat).

The big parts of the formula are the (generally) short-hop nature of the flights. For example, they like to do things like make a stop in El Paso or Denver if you’re flying to Los Angeles from Houston or Dallas. Or in Dallas, OKC or KC, on the way to Chicago from Houston.

Each leg is separately bookable, so they’re able to maximize each individual leg’s occupancy, and they’re not relying on there being a lot of people on the flight from the origin to the final destination, but rather people flying the intermediate legs as well.

Combine that with their super-fast ground-crew turnaround on planes, and you get a situation where they do better at keeping their planes flying, and consequently earning money than the more traditional airlines. It probably doesn’t make a big impact on any one flight, but over the long haul, it does save money and keeps them on time.

They also fly one type of plane (Boeing 737, in a handful of variants that they’re standardizing down to a small few), which pays off in spares buying and training of mechanics.

I suspect the reason the model hasn’t worked for other airlines is precisely because on the golden goose high traffic short routes, SWA is already dominant. I mean, it would be extremely hard for someone to pry profit out of the HOU-DAL route that SWA has pretty much locked up (and flies back and forth like 10 times a day).

You might be surprised by the number of direct, longer distance routes that Southwest flies now. They started non-stop service from ATL to LAX in mid-2012 and now they have three every day.

But I think you are correct, the majority of their flights are shorter distance. For example, there are a total of 19 flights from ATL to LAX on Friday 8/28, but only three are non-stop. Of the remaining 16, one stops in New Orleans but doesn’t require a plane change, but the other 15 do require a plane change (in Denver, Phoenix, Vegas, Houston, etc).

I personally can’t handle non-direct flights. I got to LA several times per year to visit my cousin. She lives about 15 minutes away from the Burbank/Bob Hope Airport. But it can take anywhere from 40 minutes to 2+ hours from her house to LAX on “The 405”. So I had a 90-minute layover in Phoenix and flew to Burbank. It took almost eight hours to get there and the direct flight is under five. Not worth it for her convenience…not that she ever complained.

Now I just rent a car and drive to her house. We return it to Burbank the next day and it’s usually cheaper than Uber would be!

I’d be willing to bet that every one of those is a route they identified as having a whole lot of through passengers on back before it was non-stop.

That wasn’t exactly by choice. The Wright Amendment meant that flights out of DAL literally couldn’t go nonstop to anywhere other than adjoining states (later extended out to a couple other nearby states)

That restriction finally went away in late 2014 and they immediately started flying longer routes out of DAL.