You’re not alone if you think that plane tickets are way too expensive for the profits that airlines are making annually. But once you break down how much the airlines are making per ticket after their costs, you’d be surprised at how little of a profit they’re actually making.
How much did you pay for your last flight? Probably a couple hundred dollars at least, right? That’s pretty standard across the air travel industry—in fact, one of the more popular flights, New York to Los Angeles, averages out to about $326. According to Mel Magazine, in 2017 the airline industry pulled in about $38 billion in profit, yet still only netted about $20 revenue per ticket. It leaves many people wondering: What the heck is happening to the plane ticket money?
Mel decided to break down that $326 price tag using statistics from Airlines for America to see just where the money is going. Taxes added up to around $34, so minus the profit and tax, that leaves $272. Another 32.5 percent of the ticket, about $88, goes to personnel and airline employees. From there, 20.1 percent goes to fuel costs, eating up about $55 more. Depreciation with each flight hits at $19 per ticket, and maintenance is a staggeringly low $3.25. That’s less than peanuts, financially speaking—food costs about $5 per passenger. Then comes a slew of other costs: “office supplies ($1.63), advertising ($1.63), communications for boarding ($2.17), insurance ($0.54) and commissions for third-party sellers ($2.45),” Mel reports. Add in $5 for landing fees, $11 for terminal rental, $23 for professional services related to the airline, $35 for other transport-related expenses, and $18.50 for other operating expenses.
And that’s it – the airline makes $20.82 in profit.