Running a small airline

[vectorforfood]

Hey guys,

Any tips/tricks to making my small airline profitable?

I have spent much time making sure each route is "saturated" as in demand is met almost exactly by capacity.

I'm operating a fleet of 7 DHC6 Twin Otters, so my commonality is excellent.

I am making a profit, but only by about $25K/week, and once my pre-pay lease terms are up, I will need to come up with another 25K per week just to break even, and that will allow for no growth.

At the end of each week I usually have about $240K left in the bank, but I'm also paying back a $120,000K loan over 10 years (long term I know but the repay is low)
I initially dropped my prices by 15% to promote growth, and every three weeks I have been bumping them up by 2% at a time, until I get back to base levels.

I really wish this game would let you initiate flights from other bases so long as you return to base for A/B checks?

I'm based in CYHZ (Halifax NS) and all my planes are flying pretty much from 0600 - 0000 local times, (Only about 6-7 hours of downtime per aircraft)

My load factor is slowly climbing now at about 70%, but has been hurt due to some route configuration changes in order to maximize my time in the air, but should be growing.... perhaps once it comes up I'll be making some money?

[thedr2]

Ok, a few points,

Firstly, AirwaySim's model doesn't suit the small regional airline particularly well, but you should still be able to make a half decent profit.

Twotters are good aircraft for regional flying IRL, they have fantastic STOL (Short take-off and landing) abilities and you can get them to land on pretty much any flatish surface. I don't know how thier fuel efficiency compares with similar aircraft, but it would be worth checking that out, if another similar size aircraft can fly to your destinations for a lower cost, it will definately help your profits. Obviously, if you're signed into a long term lease deal then stick with the twotters.

You say you will need to pay 25K /w on leases? Leases are paid monthly, or did you alredy take that into account?

A bank loan of 120mil?  Is that a typo? leasing 7 twotters shouldn't cost that much! 

Otherwise, everything else looks ok. Just stick at it, play with the prices a bit and hope the monies begin rolling in at some point.

EDIT: Is this your airline in Air travel boom? It's only been running one month for starters, and it tells me you're flying 2 dash 8s!

[vectorforfood]

Yea that's taking it all into account basically, I need to double the average profit margins.

And the loan was for $120K ($120,000USD)

I have another airline in Air Travel Boom, flying Dash-8's, this one I'm really working hardest on is in Jet Age 1

Everything has not yet settled out, with new routes opening, B checks being done (Great timing) I don't have a solid grasp on exactly how the day-day operation will roll out.

[Sami]

(short answer)  Like talked already before the cost structure (staff mainly) isn't really fully working for very small regional carriers, that's something that should be tuned later. You can probably make it if you have large enough fleet but it's harder than running a larger airline.

[vectorforfood]

I enjoy the challenge of running the small airline,

So Sami you're saying the economics will be tuned for small airlines later?

I don't want to stay small forever, ideally, build a healthy profit margin, then move to more national expansions.

[Sami]

don't expect that anytime soon yet though.. Probably will be a part of a bigger update package later on.

[vectorforfood]

Thanks for answering Sami,

BTW GREAT GAME!

This really kills the break time at work great!

[Jackal]

in jet age two, BC North out of Vancouver, Me, was the only carrier using the twotter for the longest time, and i made it work, i only had a ton of them for the longest time, think 11 at most flying every combination of routes in British Columbia i could find.
i made it work, tho i had no competition, i wonder how that would work if i had.

eventually, i bought other aircraft, and i eventually switched over to DHC-7s for their range and high pax.

i have 5 twotters still left in my fleet, and they make a good profit for me, and the 16 DHC-7s are making the majority of my profits.


what works best if the twotters only go into C check for 7 days, and this fact alone saves you alot in the long run.

i will eventually move onto Dash 8s when they are available.

so, in my opinion small airlines work, but you have to plan it out. make sure you have every destination taken up, not just out and back runs. when you look at your route map it should look like a web of interconnecting and crossing routes all over the place.


good luck


Jack
CEO BC North

[vectorforfood]

thanks for the info BCAir!

I am doing OK with my Jet Age 1 small airline of Twotters, profits are slowly climbing, but at least moving in the right direction...

I have started another airline in Travel Boom, running C208 Caravans (Easy to find routes)

So far my load factor is around 95%, but only one week in in that scenario, 6 more aircraft coming on-line in the next 2 weeks, we'll see how it works.

[vectorforfood]

Ok, so I have 7, count em 7 10 seater airplanes, and I apparently require:

Airline CEO    1 / 1   (100%)  25 410 USD  - 
High level management    7 / 7   (100%)  129 451 USD  60 
Middle level management    11 / 11   (100%)  152 179 USD  60 
Economics and finance    21 / 21   (100%)  111 466 USD  60  (21 Economics people for 7 airplanes?!
Corporate communications    13 / 13   (100%)  65 883 USD  60  13 people, so each plane has two people to do press conferences?
Human resources    12 / 12   (100%)  47 094 USD  60 
Quality department    7 / 7   (100%)  29 052 USD  60 
Safety and security    6 / 6   (100%)  26 257 USD  60 
Customer services    80 / 80   (100%)  239 421 USD  60 
Flight operations division    36 / 36   (100%)  191 085 USD  60 
Technical services and maintenance    41 / 41   (100%)  189 264 USD  60 
Ground handling    52 / 52   (100%)  119 654 USD  60 
Route strategies department    40 / 40   (100%)  156 979 USD  60  Route strategies? What exactly am I doing?
Pilots    43 / 43   (100%)  267 697 USD  60 
Cabin crew    1 / 0   (999%)  3 459 USD  60 
Total:  371 / 370 (160%)  1 754 351 USD / month  60    $1.75M dollars / month in staff for a 7 aircraft airline?

Something isn't exactly right here, my other 7 airplane Twotter airline suffers from the same problems.

If there's anything that needs adjustment its this!

Can I cut any of these staff without risking cancelling flights?

[bukatino2000]

this is a matter which is enough discussed in the past treaths. You can use the search function for many other info. A better tuning for small companies should be introduced with/or bigger range to contract salaries at least for pilots and other cost-intensive positions. Hold out up to this improvement 'll be in 

[juanchopancho]

I'm running a similar regional with Fokkers. The cost structure is absurd. We're paying 747 Captain wages for regional pilots. Not to mention we have 60 pilots for 8 aircraft, which seems weird.

[Jps]

Not to mention we have 60 pilots for 8 aircraft, which seems weird.

Like said in many threads, you need more pilots than just those currently sitting in the aircraft. Of course, pilots are a bit overnumbered for airline flying short legs and not flying over night, but still: When the aircraft is in the air, it needs 2 pilots to fly it. Furthermore, there has had to be 2 additional pilots at the departure city in case the original ones can't fly. So that makes 4 pilots needed/flight (ok, with short routes, 4 pilots /2 flights would be good).
And then, if your airplane flies, say 6 hours/day, it already needs 2 crews/day. So that makes 8 pilots/plane/day. And with 8 aircraft that makes 8*8=64. Of course, the 2nd crew of the day wouldn't probably need back-up pilots, so that takes 16 pilots out/day, but it's still pretty close to what is suggested. With an airline flying long routes >5 hours, pilots need to be changed at every airport, thus increaing the amount of pilots needed.

[vectorforfood]

Sami thanks for merging this thread, my bad.

Thanks for the replies from everyone else!

[JIMBORICHARDSON]

I prefer to run planes like J41 or Saab 2000 and 340b and have my airline based in scotland which i am going to try when the next game starts.

[masoniclight]

I've been trying to run a regional airline forever now (and as all of you know, I have only been successful- if you want to call it that.. three times out of the 11 attempts I have made.) so I can wait until some things are changed for the positive so that a regional airlines can make it in the game.

[Sigma]

Depending on what you want to call "regional", I ran mine as Regional in Jet Age #1 for the first few years without any real problem.  I ran all-Fokkers for my first 50 planes.  I eventually went to A300s simply because I ran out of destinations I could service out of DFW with the range I had with the Fokkers.  I might try it again in a different game and open up other hubs to extend my range.  I forayed into that this game using Denver and Indianapolis, but didn't progress too far into it as my A300s started to arrive.

Getting my company image up was the only problem I had due to the way that expense is calculated (as a factor of your number of flights, not revenue, so getting my CI up would have cost half my revenue)

Yes, my margins were less than the grossly exaggerated figures of the uber-carriers, but I was making more than enough money to have over 150 planes on order (mostly NOT small Fokkers).  I was making enough to by an F28 outright every single week if I wanted.  Doing the math, as I was of course expecting the fuel crisis, I could support fuel prices well over $300 and still remain profitable.  Fuel wasn't a concern as a regional, as my planes were very efficient (even moreso if I had went with the F27 rather than the F28), my biggest expenses were Staff and Marketing.

[vectorforfood]

Well on my third attempt, I've done something right. (Jet Age #2)

I have only 6 aircraft, HS748's, (one of my favourite planes actually) and I'm 27th last week in profit margins after only 2 weeks in operation, my value is up to 1.8M in only 2 months.

Looks like this is where I'll try and stake my claim.