FlyerTalk Forums - View Single Post - How Airlines Make Less Than $6 Per Passenger
Old Jun 3, 2014, 6:17 pm
  #10  
pdsales
 
Join Date: Aug 2012
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And Grocery Stores Claim 1.3% Margin

Originally Posted by cubfan99
Something is a bit fishy with those numbers. If the average profit per passenger is $5.42, and the profit margin is 2.4%, that would mean the average revenue per passenger is around $220. Even if that is before taxes, that seems like accounting voodoo. I can't imagine ANY route where the fare plus fees is as low as $220 these days, much less having all the routes average that.
For years grocery stores have cited profit margins hovering around 1%, in this case 1.3%. http://www.marketplace.org/topics/bu...ghly-desirable Yet grocery stores seem somehow to stay in business.

Clearly figures lie and liars figure.

One possible interpretation of the weasel-words, it could be $5.42 average per passenger segment. So a non-stop round trip would be $10.84 and a round trip with a change of planes would be $21.68.

And as another writer already wrote, if they are loading all their cost onto the ticket sales, the freight is then 100% profit.
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