US Airways drops planned Philly-Beijing route

[Hello Newman]

But TLV is a good idea because we already have presence in the area? So, where else on the Asian continent does LCC have presence?


TLV is paying for itself in freight alone.

 

[700UW]

That is usually the case in ALL International flights, the cargo pays and the passengers are profits, I worked Air Cargo when I first started with PI in TPA and we had the origination of the LGW flight and we would have to book cargo space over a week in advance.

 

[BoeingBoy]

That is usually the case in ALL International flights, the cargo pays and the passengers are profits,

That may have been the case back then but times change (and every route is different). If flying freight internationally provided so much revenue, all the airlines that operate internationally would have freighters as well as passenger planes (or maybe instead of passenger planes). Yet NW has been the only carrier to do so, and only for trans-PAC.

Just look at the airlines with big international operations. DL (including NW) reported $177 million in total cargo revenue - domestic and international. CO reported $97 million for all cargo revenue. UA, with a rather large trans-PAC operation, reported only $135 million. None of these are enough to come close to covering the cost of the international flights, much less the portion of cargo revenue derived from international flights.

Jim

 

[JayBrian]

For the three month period ending Sept. 30, 2009 US Airways reported cargo revenue of $23 Million, less that 1% of the total revenue of $2.758 Billion.


Source

 

[FA Mikey]

That is usually the case in ALL International flights, the cargo pays and the passengers are profits,

If that were in fact the case, we wouldnt see international flight reductions, and summer only service. Unless of course freight is like passengers, in wanting to go places mainly during the warm summer months.

 

[BoeingBoy]

After digging through the BTS data here's some numbers for US' TA ops in the 2nd quarter of this year.

- Operating profit of just under $4 million

- Operating Revenue of $406.9 million - the next are some of the individual revenue contributors
- Passenger revenue of just under $226 million
- Baggage revenue of $17.5 million
- Ticket cancellation fee revenue of $10.7 million
- Freight revenue of $2.5 million (0.6% of all revenue)

- Operating expenses of $402.9 million, with some of the below individual cost contributors

- Actually flying the planes back and forth $116.2 million
- All the ground employees/contractors related to TA flights $65.6 million
- Maintenance $26.9 million
- Promotional costs $20.9 million
- Admin costs related to TA operations $20 million

Keeping in mind that the company breaks revenue/expenses down nto operating regions (Atlantic, Latin America, Domestic for US) I can't guarantee that the breakdown is 100% accurate, but it's the best available publicly. Based on this data, freight covers just 2.2% of the cost of flying the airplanes and only 0.6% of the total costs of the TA operation.

Jim

 

[CynicalResAgent]

That may have been the case back then but times change (and every route is different). If flying freight internationally provided so much revenue, all the airlines that operate internationally would have freighters as well as passenger planes (or maybe instead of passenger planes). Yet NW has been the only carrier to do so, and only for trans-PAC.

Do you know what AS makes in cargo vs pax rev? I thought they had some cargo only planes, I know they have combi's.

 

[BoeingBoy]

Do you know what AS makes in cargo vs ? I thought they had some cargo only planes, I know they have combi's.

I'm not sure about the cargo only planes, but they do have combi's as you say so could conceivably make those all freight if needed. As best I know the combi's are used strictly within Alaska - many places inland can only be reached by air and on the coast by air when the ice prevents using barges north of the Aleutian chain so a lot of stuff travels by air. I suspect they make a decent sum of money off cargo because of that - just in Fairbanks there are two outfits that fly DC-6's to carry gas/fuel/cargo to these settlements.

OK, from the BTS data they got $16.8 million in revenue from domestic freight and $158,000 from Latin America freight. That's for 2nd quarter 2009. Interestingly, they got $6.2 million from bag fees and theirs are relatively low as baggage fees go - only $50 for the third bag, $15 and $25 for the first two.

Jim

 

[DHG750R]

AS has 2 B734 Combis and 1 B734 all freighter

here is the freighter
http://www.airliners.net/photo/Alaska-Air-...0(F)/1111737/L/

here is one of the combis
http://www.airliners.net/photo/Alaska-Airl...8©/1518344/L/

 

[whatkindoffreshhell]

That is usually the case in ALL International flights, the cargo pays and the passengers are profits, I worked Air Cargo when I first started with PI in TPA and we had the origination of the LGW flight and we would have to book cargo space over a week in advance.

How long ago was that?? Now perhaps only mail is the cargo on a domestic flight because of TSA rules and the elimination of most domestic widebody service. Domestic cargo belongs to fedex/ups now.

Never did cargo paly for the flight and pax were profits. And historically USAir has never regarded cargo as a serious revenue source. Now their reputation in the market is dismal.
USAir offered $0.05kg rates back in the nineties -- great price but your arrival time may be two weeks out.

Shippers only put cargo in the air when they are serious. Usair is not & never has been serious about cargo.

 

[nycbusdriver]

But TLV is a good idea because we already have presence in the area? So, where else on the Asian continent does LCC have presence?


TLV is paying for itself in freight alone.

Although it's not shown in quotes, your first paragraph is a quote of my previous post. That being said, you've taken it out of context.

I fully agree that TLV was/is a good idea. My rhetorical questions were directed at at hp_fa who said that it was ok to go to TLV because we already had a presence in the area, but it's not ok to serve PEK because it would be a lone flight to Asia where we have no presence.

I have no doubt whatsoever that TLV is making money in a big way, and I am in favor of starting service to anywhere that will do the same. We have no service to South America, but we will soon go to Rio. Given hp_fa's logic, going to Rio makes no sense since, like Peking, we have no presence there and it would be a lone flight to South America.

I'm glad not everyone responsible for developing new markets uses such circular logic as hp_fa proposes.

 

[nycbusdriver]

That is usually the case in ALL International flights, the cargo pays and the passengers are profits, I worked Air Cargo when I first started with PI in TPA and we had the origination of the LGW flight and we would have to book cargo space over a week in advance.

I agree that international cargo is a big moneymaker. But I'm not sure there is enough for the passenger carriers to do well at it. Maybe it's because of a lack of marketing. MAybe it's because the cargo carriers have a better infrastructure for pickup/delivery and thereby suck up almost all of the market. At any rate, more often than not, I carry across the Atlantic a cargo manifest that has written in huge black block letters: NIL. How much subsidizing of passenger fares do you think is happening on those flights? The answer: NIL. And it happens much more often than not.

 

[brokenwrench]

The same can be said for NRT. It'll be interesting to see whether US eventually let's that authority go (assuming the deal with DL is approved) since there's still no airplane announced that will serve it satisfactorily from PHL (until the A350 come along).

Jim

Just my opinion, but. With UA and CO aligning for a merger US is kinda the default bulk available to purchase for AA. IF, this is the case the NRT slot could be utilized quite well by the folks down in Texas.

 

[NAPAUS]

:blink: When is this topics going to die. Its over it's done... no China. They never were serious about flying it and should be immediately given to someone else. Let it go - its over and done. HELLO Mr Moderator are you listening. <_<

 

[FA Mikey]

If thr folks in TX wanted they could utilize the access and slots they already have.