Fuel Supplier

[Trident2]

   Hi,

      I was wondering that "is it worth getting a fuel supplier or not?" I mean is
the monthly fee worth paying at say 150K, when you are getting somthing like 4.3%
discount?. I do realise that also if you have 300 planes then that discount is more
attractive than only having 50 planes, but at what point does it become viable to
employ a fuel supplier?.


Cheers


Steve.

[Gleipner]

Let's make some easy calculations out of it:

Say your fuel cost are 2 500 000, fee 450 000 and discount 5%.
As you only get discount from your base split FC in half -->  2500000/2=1250000
Now find out what 5% of 1 250 000 is -->  1250000*0,05=62500
And of course 62 500 is less then 450 000 the contract won't be profitable.

And the other way around (to find out how much you must spend to make use of discount)
Fee/Discount=½ Fuel Cost and ½ Fuel Cost*2=Fuel Cost
In example:
450000/0,05=9000000 => you should spend at least 18 million dollars on fuel before signing up on a deal like this

Calculations should be right but had a long day at work so they might need a check up buy someone, hope this gave some guidance though.

[Jona L.]

Calculations should be right but had a long day at work so they might need a check up buy someone, hope this gave some guidance though.

Correct as from my p.o.v.

cheers

[Trident2]

  Hi,

   Thanks for that, I don't think that I expected such a detailed explanation
as that, but putting it down that way more so on the second example I
can see that I'd have to be a bit of a numpty to go into a contract on day
one, and by the looks of it for a while after, however obviously as the A/C
increase so does the fuel bill and so at some point it does make sense.

Thanks for that,


Steve.

[Gleipner]

Np mate.

Well I've been tempted as well, also those fancy discount numbers looking so good. Always good though to cross check before signing up and having the formula it's not that hard to do a check up now and then. But as was said in another thread it would really be nice with a feature where you can see fuel used at each base.

[ACfly]

The larger the fleet the more valuable the oil contracts become..

[romeozulu]

Hi,

Fuel contract become interesting when you start operating LH A/C