RE: Airport landing charges
Don’t be fooled by the £8/£18 seat prices. This applies only to a proportion of the available seats!
The business models of locos are quite clever and “yield management” is the underlying philosophy. They generate revenue per flight which is not too far off the majors, which combines well with lower operating costs.
The rule of thumb is that if the revenue for a flight is enough to cover the “marginal cost” then the route will be flown. Marginal cost is basically the cost of flying the route as opposed to the cost of the aircrtaft sitting on the tarmac. Certain costs – lease payments, crew salaries, promotional costs etc.. will be incurred regardless of whether the aircraft flies or not. Other costs are marginal, such as fuel, landing fees, overtime/sector pay for staff and so on. As wysiwyg has pointed out, the accountants are taking over 🙂
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