Airlines trimming weight to curb appetite for fuel
By Mark Skertic
Tribune staff reporter
Published November 30, 2005
Consumers aren't the only ones worried about the high cost of fuel--or their weight.
With fuel costs 40 percent higher than a year ago, and many airlines struggling to eke out a profit, carriers this year have accelerated efforts to shed fuel-guzzling pounds.
They carry less drinking water. In onboard bathrooms, they've replaced glass mirrors with acrylic ones. And ovens, a waste of space and weight on flights where meals are no longer served, have been tossed overboard.
Carriers also have stopped topping off the fuel tank of aircraft before takeoff, and they are tougher about heavy bags, enforcing rules that call for extra fees.
"We fly so many flights a day that if we can get 100 pounds off every flight, we save millions of dollars a year," said American Airlines Capt. Steve Chealander, a 737 pilot who is also manager of flight operations efficiency.
Although fuel prices have dropped slightly in recent weeks, they remain far above what carriers used to budget for jet fuel expenses and 80 percent more than two years ago. For many airlines, fuel expenses are nearly on par with labor costs, historically the largest expenditure.
The need to reduce weight aboard aircraft and look for other fuel savings has been drilled into every airline employee, from pilots to baggage handlers.
Fliers who travel only during the holiday season will find airlines more likely to charge them $25 for checked bags that weigh more than 50 pounds. Those trying to walk onto the plane with more than two bags are more likely to be stopped and told the extra items will have to be checked.
Even the number of children on board is a factor considered when deciding how much fuel to put into the tank. More kids means less overall weight and the opportunity to reduce the amount of fuel needed.
"If a passenger is a child, we can account for less weight," Chealander said.
Still, airlines include a large safety margin when calculating how much extra fuel to carry.
But at the gate, the plane is more likely to be powered by the local airport, not the airplane's engines. Most planes run air conditioning and lights through an electrical connection to the airport.
The age of winglets
Those with a window seat may spot one of the industry's newest efforts. Many aircraft wings now sport winglets, an angled extension that helps reduce drag. The tiny devices can have a major impact on fuel efficiency.
Southwest Airlines began receiving Boeing 737-700s with winglets in August 2004. Aircraft with the devices burn 3 percent less fuel.
"At today's prices, these savings are very meaningful," a Southwest spokeswoman said. "Winglets save up to 92,000 gallons of fuel per aircraft per year."
With winglets on more than 100 planes, that equates to about $9 million annually.
And that's key because fuel remains the largest uncontrolled cost in the industry. Airlines in bankruptcy protection or facing the prospect of it have managed to cut hundreds of millions of dollars in pay and benefits. But, despite their best conservation efforts, fuel costs can't be cut as dramatically as labor expenses.
The airline industry uses about 19 billion gallons of fuel a year, according to the Air Transport Association, an industry trade group. Every 1-cent-per-gallon increase drives the annual cost up $190 million industrywide.
The average price for jet fuel was more than $100 per barrel in September. At 42 gallons per barrel, airlines were paying more than $2.50 per gallon. The price has fallen in recent weeks to $69.75 a barrel, according to the association. It began the year at $48.82.
United Airlines Capt. Joe Burns, director of flight standards and technology, said every corner of each aircraft in the fleet has been looked over for ways to reduce its weight.
"We've even pulled old electronic equipment off that wasn't being used, because we were just carrying the weight around," Burns said. "We took the curtains off of our airplanes for security reasons, but there was definitely a fuel component for doing that as well."
Every United pilot and dispatcher was sent to training this year on ways to cut fuel usage. Other airlines have sent their pilots to training as well.
"That's a large expense, but we feel we're running a more educated operation," Burns said.
High fuel costs have been the bane of the industry. Only one large carrier, Southwest Airlines, is expected to end the year with a profit, thanks in part to fuel hedges it purchased during years when prices were lower.
But even Southwest faces added pressure on its bottom line because of higher prices for the portion of its fuel needs that are not hedged. Through the first nine months of the year, Dallas-based Southwest spent about $220 million more on fuel than during the same period in 2004.
Price forecast: more of same
United Airlines has said higher fuel prices will be one of the major challenges it faces when it exits bankruptcy protection, a move expected early next year.
Fuel costs are unlikely to drop next year, according to industry analysts.
"As long as oil is at $55 a barrel, fuel prices remain a factor," said Ray Neidl of Calyon Securities. "The fuel-usage cut is really incremental. It's not a huge thing. They're doing a commendable job, but they can't change things overnight."
The airlines' efforts are important, but they are not enough to overcome the dramatic increase in fuel costs, said Betsy Snyder, airline analyst for Standard & Poor's.
"Obviously every little bit helps, but that's about it," she said.
Fuel prices will continue to challenge the industry in 2006, she said.
"There's only so much they can do," Snyder said. "They can raise prices, which they have been trying to do. They can reduce costs. But fuel is outpacing labor as an expense these days."
Even if fuel prices begin to come down dramatically at some point, it's unlikely airlines will abandon their new efforts at conservation, Chealander said. More consideration now is given to such factors as tailwinds and headwinds when calculating how much fuel is needed and how fast the engine needs to run, and that won't change, he said.
Traditionally, he and other pilots weren't too worried about how much fuel they burned, only reaching their destination. That way of looking at things has been altered in the last year.
"So we've really had a philosophical change with crew members, teaching them the time value of how much fuel is used," Burns said. "What really matters is how long can you stay in the air."
By Mark Skertic
Tribune staff reporter
Published November 30, 2005
Consumers aren't the only ones worried about the high cost of fuel--or their weight.
With fuel costs 40 percent higher than a year ago, and many airlines struggling to eke out a profit, carriers this year have accelerated efforts to shed fuel-guzzling pounds.
They carry less drinking water. In onboard bathrooms, they've replaced glass mirrors with acrylic ones. And ovens, a waste of space and weight on flights where meals are no longer served, have been tossed overboard.
Carriers also have stopped topping off the fuel tank of aircraft before takeoff, and they are tougher about heavy bags, enforcing rules that call for extra fees.
"We fly so many flights a day that if we can get 100 pounds off every flight, we save millions of dollars a year," said American Airlines Capt. Steve Chealander, a 737 pilot who is also manager of flight operations efficiency.
Although fuel prices have dropped slightly in recent weeks, they remain far above what carriers used to budget for jet fuel expenses and 80 percent more than two years ago. For many airlines, fuel expenses are nearly on par with labor costs, historically the largest expenditure.
The need to reduce weight aboard aircraft and look for other fuel savings has been drilled into every airline employee, from pilots to baggage handlers.
Fliers who travel only during the holiday season will find airlines more likely to charge them $25 for checked bags that weigh more than 50 pounds. Those trying to walk onto the plane with more than two bags are more likely to be stopped and told the extra items will have to be checked.
Even the number of children on board is a factor considered when deciding how much fuel to put into the tank. More kids means less overall weight and the opportunity to reduce the amount of fuel needed.
"If a passenger is a child, we can account for less weight," Chealander said.
Still, airlines include a large safety margin when calculating how much extra fuel to carry.
But at the gate, the plane is more likely to be powered by the local airport, not the airplane's engines. Most planes run air conditioning and lights through an electrical connection to the airport.
The age of winglets
Those with a window seat may spot one of the industry's newest efforts. Many aircraft wings now sport winglets, an angled extension that helps reduce drag. The tiny devices can have a major impact on fuel efficiency.
Southwest Airlines began receiving Boeing 737-700s with winglets in August 2004. Aircraft with the devices burn 3 percent less fuel.
"At today's prices, these savings are very meaningful," a Southwest spokeswoman said. "Winglets save up to 92,000 gallons of fuel per aircraft per year."
With winglets on more than 100 planes, that equates to about $9 million annually.
And that's key because fuel remains the largest uncontrolled cost in the industry. Airlines in bankruptcy protection or facing the prospect of it have managed to cut hundreds of millions of dollars in pay and benefits. But, despite their best conservation efforts, fuel costs can't be cut as dramatically as labor expenses.
The airline industry uses about 19 billion gallons of fuel a year, according to the Air Transport Association, an industry trade group. Every 1-cent-per-gallon increase drives the annual cost up $190 million industrywide.
The average price for jet fuel was more than $100 per barrel in September. At 42 gallons per barrel, airlines were paying more than $2.50 per gallon. The price has fallen in recent weeks to $69.75 a barrel, according to the association. It began the year at $48.82.
United Airlines Capt. Joe Burns, director of flight standards and technology, said every corner of each aircraft in the fleet has been looked over for ways to reduce its weight.
"We've even pulled old electronic equipment off that wasn't being used, because we were just carrying the weight around," Burns said. "We took the curtains off of our airplanes for security reasons, but there was definitely a fuel component for doing that as well."
Every United pilot and dispatcher was sent to training this year on ways to cut fuel usage. Other airlines have sent their pilots to training as well.
"That's a large expense, but we feel we're running a more educated operation," Burns said.
High fuel costs have been the bane of the industry. Only one large carrier, Southwest Airlines, is expected to end the year with a profit, thanks in part to fuel hedges it purchased during years when prices were lower.
But even Southwest faces added pressure on its bottom line because of higher prices for the portion of its fuel needs that are not hedged. Through the first nine months of the year, Dallas-based Southwest spent about $220 million more on fuel than during the same period in 2004.
Price forecast: more of same
United Airlines has said higher fuel prices will be one of the major challenges it faces when it exits bankruptcy protection, a move expected early next year.
Fuel costs are unlikely to drop next year, according to industry analysts.
"As long as oil is at $55 a barrel, fuel prices remain a factor," said Ray Neidl of Calyon Securities. "The fuel-usage cut is really incremental. It's not a huge thing. They're doing a commendable job, but they can't change things overnight."
The airlines' efforts are important, but they are not enough to overcome the dramatic increase in fuel costs, said Betsy Snyder, airline analyst for Standard & Poor's.
"Obviously every little bit helps, but that's about it," she said.
Fuel prices will continue to challenge the industry in 2006, she said.
"There's only so much they can do," Snyder said. "They can raise prices, which they have been trying to do. They can reduce costs. But fuel is outpacing labor as an expense these days."
Even if fuel prices begin to come down dramatically at some point, it's unlikely airlines will abandon their new efforts at conservation, Chealander said. More consideration now is given to such factors as tailwinds and headwinds when calculating how much fuel is needed and how fast the engine needs to run, and that won't change, he said.
Traditionally, he and other pilots weren't too worried about how much fuel they burned, only reaching their destination. That way of looking at things has been altered in the last year.
"So we've really had a philosophical change with crew members, teaching them the time value of how much fuel is used," Burns said. "What really matters is how long can you stay in the air."
