Originally Posted by
Dr. HFH
Operating costs are a key factor in achieving and maximizing profitability, of course, and the cost of fuel is one of the most significant factors in airline operating costs.
While many airlines purchase fuel through hedging in the futures market, thus providing predictability in their fuel costs, Qatar does this only rarely. Most of the time, QR purchases fuel as needed, at current market prices.
Indeed. But let's assume that QR has decided to operate a fixed number of flights, as they have to in order to return to some normalcy. They have to if they want to survive as a global airline, even if those flights have light load.
The marginal cost of adding one pax is quite different from the average cost. In cost accounting the marginal cost of that pax is rather small.
QR is in survival more. They are bleeding cash and reputation. The State of Qatar is bleeding cash too..QR only hope is that the situation returns to normal and that the "episode" will be forgotten in a couple of years. In the meanwhile, they have to fly as many flights as possible.