NWA says fuel cost oculd ruin profitgreenspun.com : LUSENET : TB2K spinoff uncensored : One Thread
Northwest Airlines and other big carriers could report losses this year if fuel prices remain at their levels, Northwest president and CEO John Dasburg said Friday. The carrier's expectation was that fuel prices would averate 67 cents for the year. Currently jet fuel is priced at about 85 cents a gallon. Northwest will take a hit of $600 million due to the higher cost. Its profit last year was $300 million. Each penny increase increases the airlines costs by $20 million on an annual basis.
Dasburg told Reuters that rising fuel prices have caused the airline to delay buying new aircraft
-- John (email@example.com), March 05, 2000
hmmmm The major carriers tacked-on a fuel surcharge to ticket prices some time ago. Still not enough?
-- firefly (firstname.lastname@example.org), March 05, 2000.
Fuel cost is the second highest airline cost after labor. I've never seen a spread sheet listing the costs that go into a ticket, but let's say its 30%. Then the 30% increase in fuel cost is a 10% surcharge expense onn the ticket. The flat $20.00 surcharge may cover short trips, but doesn't make up for the longer ones.
-- John (email@example.com), March 05, 2000.