[marek]

Well, they're in for a crash landing

http://news.bbc.co.uk/1/hi/business/4096857.stm

[spot5050]

I heard on Bloomberg earlier this year that the airline industry as a whole has a breakeven of $36/barrel, ie. below $36 it makes money, above that it's losing money.

My jaw dropped when I heard that - I had no idea that the $/barrel breakeven for any industry has been calculated and was public knowledge.

[bruin]

This story has been on mind too. I saw that figure some months ago. Overcapacity has kept airlines from raising rates. These lowcost airlines are not moving rates.

I read some of the majors have tried to move up rates in the form of a "fuel fee" but they lost too many seats to the competition.

Eventually they all need to raise rates together or, more likely, some will fail and the fares will balance out with rates.

[smiley]

Airlines hedge themselves against higher prices. They can do that for about 6 to 12 months. However now they have tho re-hedge against higher prices and that's when they start losing money.

[trespam]

$this->bbcode_second_pass_quote('bruin', 'T')his story has been on mind too. I saw that figure some months ago. Overcapacity has kept airlines from raising rates. These lowcost airlines are not moving rates.

I read some of the majors have tried to move up rates in the form of a "fuel fee" but they lost too many seats to the competition.

Eventually they all need to raise rates together or, more likely, some will fail and the fares will balance out with rates.

[marek]

There are even airlines that are hedged until 2008, like for example Southwest in the USA. Other U.S. airlines didn't have enough cash to hedge adequately and are suffering right now (American, Delta, US Airways, United).

[2007]

Howdy,

this is your captain speeking!

any other peakoilers who happen to be plane spotters? - not exactly the hobby of the future though. I regularly read the plane magazines 'Aviation week' and 'Flight international', the latest Airbus vs. Boeing battle, planes, technology etc. However, they've been pretty quiet about fuel costs, not to mention oil in general; and depletion, Hubbert's peak, oil reserves - that's light-years away. Until last week, with several articles about fuel costs - not exactly geology but some sort of beginning.

If you're an Airline CFO - and can't bother to read it all - here's a short version:

$this->bbcode_second_pass_quote('', 'T')hey were right. Even accounting for the cost of transporting the additional fuel, the airline still generated a savings: a whopping $112.
---
British Airways now sells inflight duty-free alcohol in plastic bottles instead of glass to cut down on weight.

[khebab]

I read somewhere that the airlines have put together their own strategic reserve of jet fuel. This reserve provides a buffer in order to absorb short spikes in fuel prices. However, we are now talking about high prices around $45 for an extended period of time so the industry costs will be directly affected.

[clv101]

The airline industry as it is today is fundamentally screwed. Oil will never again be available in significant quantity significantly below $40 a barrel for significant periods of time.

I fully expect the volume of air travel to reduce and the price increase... probably to similar levels and relative prices as the 1950's i.e. only the extremely wealthy will be able to afford it.

An alternative to jet liners are airships - if the economy is still in a fit enough state for the R&D to be carried out I expect airships to be carrying more people than jets in a decade.

[spot5050]

$this->bbcode_second_pass_quote('clv101', 'I') expect airships to be carrying more people than jets in a decade.

[2007]

1st ww again -

RAF airship interceptor scrambled to fight off artillery observation balloon.

[clv101]

$this->bbcode_second_pass_quote('spot5050', '')$this->bbcode_second_pass_quote('clv101', 'I') expect airships to be carrying more people than jets in a decade.

[2007]

...'there must be a gallon somewhere'

[Subjectivist]

http://youtu.be/v92U2F9gbUo

Here is my suggestion, fly half as fast but get twice the luxury on your flight. Can any of you remember the heyday of air travel when the goal of the airlines was to end service, not stuff passengers in like sardines?

[Tanada]

I have argued around here a couple times that for medium to long domestic flights propeller driven craft flying around 300-400 mph make a lot of sense. To go from Cleveland, Ohio to Orlando, Florida is just shy of 900 miles. Take a modern jet like a 777 cruising at 560 mph and you can fly there in 1 hour 40 minutes, but you have to add about 90 minutes before lift off and 30-45 minutes after landing no matter how fast the plane flies. Total elapsed time 3 hours 40 minutes to 3 hours 55 minutes. Take the same trip in a 400 mph propeller aircraft like the Dash-8/400 and your flight time increases to 2 hours 15 minutes. Total elapsed time goes to 4 hours 45 minutes through 5 hours. So your trip takes about one hour longer, but burns about half as much fuel. How is that for eco friendlier flying?

Flying will never be totally eco friendly because it takes a lot of energy to haul anything through the air compared to a train or a ship. However if you can virtually double your fuel efficiency by slowing down a modest amount why wouldn't you? Ha, what if the FAA imposed a domestic air speed limit of 450 mph like the old 55 mph highway speed limit?