Why Flying Is So Terrible Even As Airlines Spend Billions | Big Business
Business Insider・12 minutes read
Airlines spend billions on complex operations like flying, with passenger dissatisfaction increasing despite high budgets. Labor costs, maintenance, food, and other expenses account for significant portions of airline spending.
Insights
- Airlines allocate a significant portion of their budget to labor costs, with pilot and flight attendant salaries being a substantial expense, highlighting the importance of well-trained staff in ensuring safety and service quality.
- Despite the billions airlines spend on operating costs, passenger dissatisfaction with air travel is on the rise, indicating that revenue generation alone does not guarantee customer satisfaction, suggesting a need for airlines to focus on improving the overall passenger experience beyond financial investments.
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Recent questions
How much do airlines spend on food annually?
2%
What percentage of an airline's budget goes to maintenance materials?
Just under 2%
How often do airlines need to repaint aircraft?
Every 7-10 years
What percentage of an airline's operating expenses are landing fees and gate space charges?
2.5%
How much of an airline's budget is allocated to labor costs?
About a third
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Summary
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Airlines: High Costs, Complex Operations, Revenue Streams
- Airlines spend billions annually to operate complex operations like flying aircraft, despite making billions in revenue.
- Passenger dissatisfaction with air travel is increasing, despite high airline budgets.
- Food comprises about 2% of an airline's annual spending, with Emirates producing 200,000 meals daily in 2019.
- Maintenance materials account for just under 2% of an airline's budget, with labor costs being significant due to the complexity of aircraft repairs.
- Repainting aircraft is necessary every 7-10 years, costing around $200,000 for a typical jet.
- Landing fees, gate space, and other charges make up 2.5% of an airline's operating expenses.
- Airlines invest heavily in new aircraft, with Southwest being Boeing's largest customer for the 737.
- Labor costs make up about a third of an airline's budget, with salaries for pilots, flight attendants, and other staff being significant.
- Extensive and expensive training programs are essential for pilots and flight attendants, ensuring safety and service standards are met.
