the cost to fly today essays

the cost to fly today essays Airline pricing and demand has changed in many ways over the years. From when its infancy in 1926 passenger revenue started out at twelve cents per mile to now in 2004 it is set at fourteen and a half cents per passenger mile. It may seem that the pricing has not changed much; however, when you look at the statistics over the past eighty years, the prices have really fluctuated. Airline pricing hit its all time low in 1945 at four and a half cents per mile, and its record high is currently now in 2004 at fourteen and a half cents. There are many different factors that affect airline pricing. For example, passenger trends and habits change from year to year. The demand for travel also changes. Another price change can come from competitive ad offers. But after analyzing all of the factors, I believe that the main factor for price changes from year to year comes primarily from the airline operating costs. One may separate airline costs in to two main categories: direct operating costs and indirect operating costs. The first category to discuss is direct operating cost. Direct operating cost can be subdivided into three separate groups: flight operations, maintenance and overhaul costs, and depreciation and amortization. To begin with, flight operations include several items. First, the flight crew expenses involving salaries, traveling expenses, allowances, pensions, and insurance for the pilot make up a portion of flight operations. The wages of the flight crew also changes from year to year because of labor agreements and wage negotiations. The second item in flight operations and the most expensive direct operating cost is the use of fuel and oil to power the aircraft. The reason why fuel and oil are the most expensive is because the price of oil continues to fluctuate as well as the increasing demands of oil. The amount of fuel for any given aircraft can vary based on differe nt variables. These variables include the num...