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Author Topic: Min profitable load factor?  (Read 637 times)

NicholasB

  • Former member
Min profitable load factor?
« on: May 19, 2009, 03:21:00 PM »
What do you think would be a minimum possible load factor to still justify the route?

eg: say a A330-200 doing about 5000nm hop?

Im very curios about this.

thanks

NicholasB

Kammola

  • Former member
Re: Min profitable load factor?
« Reply #1 on: May 19, 2009, 05:10:59 PM »
For strategic reasons any load factor will do. Putting really much overcapasity is an efficient way to keep others away from a route. Of course you need to have some final goal, like a plane that fills. I have done that way with some routes, when there were not small enough planes available.

Kontio

  • Former member
Re: Min profitable load factor?
« Reply #2 on: May 19, 2009, 05:50:26 PM »
It's a complicated question as it depends on many other factors. If it's a route with a lot of competition and I have decided to drive the competition away it may mean lots of planes with relatively low load factors. Usually it's a question of resource allocation: could I make more money by putting this plane on another route?

NicholasB

  • Former member
Re: Min profitable load factor?
« Reply #3 on: May 20, 2009, 05:11:23 AM »
Thanks Guys,

the reason im so curios is: as we know there are less and less routes for long haul with high demand, but there are still many that have a demand for about 170-190 daily pax. I do have a 767-300er on order which is configured for about 230 pax. Im curios if i put in on a route like above, will i be able to make some money with it. The facts are, ill probably have that market stitched up, but it would probably never grow much and would have to accept about 60-75% load factors permanently.

Cheers,

NicholasB

Jps

  • Former member
Re: Min profitable load factor?
« Reply #4 on: May 20, 2009, 11:11:11 AM »
I'd say you can make profit with it, provided that you have a lot of 767s to keep the fleet costs low. Also, if there's a route from B to C that has even higher demand, it's even better. And will most likely take 2 aircraft to have that route covered at least 6 times/week.

 

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