Airline Mogul Forum
Airline Mogul => General Chat => Topic started by: Expairience on March 12, 2008, 11:44:35 am
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Because you can't earn money in the exotic places.
I'm based at the largest airport in Africa, Johannesburg. At an early stage I realized that even with little competition, flying to the continent's most populous places didn't earn a lot of money at all. Through an alliance hub in AMS I realized how easy it was to get stinking rich, even with 10 airlines competing. So all I did was buy airplanes and lease them out. This made me the highest value airline in Africa and around rank 75 in the whole game, all without even flying routes (apart from my small planes I still keep flying)
Now I received my first DC8. I was finally going to start playing! I planned to build a huge super long range network with IL62s from Joburg to all major but far away cities in the world. So I created a route Joburg-Sao Paulo (both are the biggest airport on their continent), 0.5 frequency and another 0.5 to the other Sao Paulo airport, the second largest airport in the continent.
Guess what, my DC8 earns a DOP of little more than 200K, a number I've easily reached with a 737 out of AMS and even Joburg. Only that a 737 costs almost a quarter of a DC8 and takes much shorter to deliver.
Again, I'm in a situation where I should lease out my plane because I'd earn much more than I would if I put it on routes.
I'm sure that most of you have realized the same thing, that long haul (especially if you're not in Atlanta or London) just doesn't earn you a lot more than well planned short haul operations.
In real life it is the other way around, many airlines survive on their long haul routes.
Maybe the formulas should be changed a bit? Any idiot can make a killing by hubbing out of Atlanta. Look at the game's richest airlines. I just kind of lost interest in the game by now. Being stuck in Africa, even at the biggest airport, I feel there's not a lot I can do.
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in big airports, fly for some routes within 600nm can make 100,000 with 3-4 competitions.
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in big airports, fly for some routes within 600nm can make 100,000 with 3-4 competitions.
Did you even read my post? You're just proving my point.
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If you were based at an airport the exact same size in Europe or North America, flew to the airports the exact same distances and sizes away, you would make the exact same amount of cash. (Give or take a few Euros.)
I'm sure that most of you have realized the same thing, that long haul just doesn't earn you a lot more than well planned short haul operations.
This is valid for any airport in the game, whether it's a 350k or 25k airport. People do long hauls because they can (and other strategic reasons).
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Just because you have a long range aircraft flying between two high capacity airports does not mean you will see huge returns.. the larger aircraft burn more fuel.. and the longer you fly the more fuel you burn.. causing higher costs to operate a leg.
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Just because you have a long range aircraft flying between two high capacity airports does not mean you will see huge returns.. the larger aircraft burn more fuel.. and the longer you fly the more fuel you burn.. causing higher costs to operate a leg.
But then what is the whole point? From a business point of view, when I buy a plane that is 4x to 8x as expensive as a 737, I want to earn 4x to 8x more money, right? If not, then why even bother? Then everybody should just stick to short haul.
Since this is obviously different in real life, maybe the game formulas should be adjusted.
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But you gotta remember the route edit time each day :lol:
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You can make money in Africa. The key is initial base selection.
Problem with Johannesburg is there are no airports of a decent size within range of the entry-level aircraft, so it is really hard to grow rapidly. (I learned that last round.)
African airlines will never be as big as NA or European airlines, but with good decisionmaking, they can grow at a decent pace.
I've been watching you, and am intrigued by your strategy and how well it has worked. Eventually you are going to run out of suck- erm, "people willing to pay 20 mil a month for a 737." ;)
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But then what is the whole point? From a business point of view, when I buy a plane that is 4x to 8x as expensive as a 737, I want to earn 4x to 8x more money, right? If not, then why even bother? Then everybody should just stick to short haul.
Since this is obviously different in real life, maybe the game formulas should be adjusted.
Airlines in real life do not make 4-8x more on long-hauls compared to short-hauls using more expensive planes. Like in the game, the further away an airport is, the less competitive it is, thus, you will be able to have a steady income/DOP. ROI's on long-haul planes are much lower compared to a short-haul plane where you can have many more routes in a day. In a short round like this, you're probably better off concentrating short-hauls. In a longer round, though, it's essential to build up a solid long-haul network in order to maintain a high DOP.
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But then what is the whole point? From a business point of view, when I buy a plane that is 4x to 8x as expensive as a 737, I want to earn 4x to 8x more money, right? If not, then why even bother? Then everybody should just stick to short haul.
Since this is obviously different in real life, maybe the game formulas should be adjusted.
Your last statement goes to show you have no idea about airline finances in real life...
The larger the aircraft - the more fuel burned. The longer the flight - the more fuel burned...
Operating a flight between LAX-SYD might yield a .5-mil income per flight, but the cost to operate that will be atleast 1/6-1/5th that price.. which is why a 747 on a long route will make less than a BAe146 on a 500nm trip between two average load airports... and this is the same as in the real world.
Why do people do it? Because short routes are saturated... so if you want to increase your profit and grow as an airline without having to open a large amount of bases, you have no choice but aquire longer range aircraft, so that you can operate routes with the same demand but less competition...
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Maybe that's why I choose my base at PIT time and time again. I am within very close range of BOS, New York, PHL, BWI, DCA/IAD, DTW etc... Right off the bat, my BAE-146 made close to 750k... I ultimately opened bases in DCA and TPA, and now I am the biggest airline in TPA and DCA regarding pax, while sharing the rank of top airline with Crystal at PIT. My DOP is over 12 million, and I am among the top 100 airlines in the world; top 40 in North America. (of course, I learned a little lesson about 1x frequencies vs 2+ frequencies. If not for that, I'd probably be in the middle of the pack somewhere...)
I origiinally wanted to have an all-jet fleet, which in some cases I do, but in order to afford the jet aircraft, I took 14 Shorts 360s which turned an average profit of 200k roughly. Now I am ordering DC9s by the quantity (2, 3, 4 planes at a time).
Coming back to why Europe and the USA are so crowded, it's like what others have said. They pick airports with not only a lot of people (8-10 million-plus), but also within close proximity of high-pax markets. Most of these airlines are based at places like ORD, JFK, ATL, LAX, etc and like I said, these are all within other big airports (SAN, BOS, BWI, PHL, PIT, CLE, DTW, SFO, LAS, PHX, etc) Look at Europe. LHR, CDG, Orly, AMS, FRA, MAN, DUB, MAD, etc are all very close to one another as well...
Regarding long-haul aircraft, I am changing my mind about aircraft type. I am going to go with 762ERs and L-1011s. The 742 burns too much fuel. Not to mention, way too much $$$ up front!
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I agree about the 747.. operation costs and up front cost doesn't seem worth it.. I've been investing in medium range aircraft... Kinda wish the game would hurry up to 1994 so we can have some A330s :P
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Just because you have a long range aircraft flying between two high capacity airports does not mean you will see huge returns.. the larger aircraft burn more fuel.. and the longer you fly the more fuel you burn.. causing higher costs to operate a leg.
But then what is the whole point? From a business point of view, when I buy a plane that is 4x to 8x as expensive as a 737, I want to earn 4x to 8x more money, right? If not, then why even bother? Then everybody should just stick to short haul.
Since this is obviously different in real life, maybe the game formulas should be adjusted.
You see, certain people on here have a real life as well. We need to study or work (exept when we're on vacation like I am at the moment) and some of us even have a girlfriend (never thought of that, eh? :P ). We can't just spend our days updating routes! Short haul planes may bring me thrice the income of a longhaul A310, but I just can't cope with more than 130-150 routes!
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I agree about the 747.. operation costs and up front cost doesn't seem worth it.. I've been investing in medium range aircraft... Kinda wish the game would hurry up to 1994 so we can have some A330s :P
Hint: There's a plane called 767-200 out on the market right now :wink:
Not as good as the A33X but better than the B74SP
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Anyone who knows anything about the airlines of real life will tell you that most of their profit comes from their international routes (Europe/Asia/CentralSouth America), not their domestic networks.
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This little airline named Southwest (you might have heard of it) would beg to differ.
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Anyone who knows anything about the airlines of real life will tell you that most of their profit comes from their international routes (Europe/Asia/CentralSouth America), not their domestic networks.
Not true...
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Just to give a little insight on airline finances, you may remember a Dateline NBC spot a few years back.....American Airlines 767 from JFK to LAX actually was lucky to break even on a daily basis and the plane was full. Airlines make money where they can, some from long haul, some from shorthaul. Successful airlines are those with the right schedule, the right connections, the right person watching the purse strings and most important, the right reputation.
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A little bit of math for those too lazy
747-400 on Whatever airlines from Los Angeles to Sydney
9 first class tickets at 10k a piece (23 FC seats)=90k that's fair price, no taxes added
62 Business class tickets sold at 5500 a Fair=341k That's also with taxes paid by customer
280 Economy class tickets sold a 1200 a Fair=336k as above
767 Thousand in Revenue
Fuel prices........
you average 747-400 will burn 54000 gallons or so on a flight like this at a good price considering quantity discount (3.80 a US gallon)
205,200 dollars
Gate price+Landing fee
10,000~ range for that flight
Employee costs
15,000~ (including ground crews)
Maintnence fees
100,000~
Insurance
25,000~
you still make 411,000 dollars on an Okay load
doing a round trip every 1.5 days means it would take 2 to 3 years of flying the route to actually start making a profit lol
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This little airline named Southwest (you might have heard of it) would beg to differ.
Well, they are not an international airline, and operate on a COMPLETELY different structure than a major international such as Delta, United, or even the likes of British Airways or Lufthansa. That is comparing apples to oranges. If any of those airlines tried to do what Southwest does, they would fail miserably. Not really a valid comparison.
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you still make 411,000 dollars on an Okay load
i don't get what you guys are talking about
In this game, you'll make about 200k on that route (with no/low competition). An average 737 in this game will make about 200-400k doing a few short/medium-haul routes. The OP is insisting that you should make ~1.6-3.2M with a 747 doing two trans-continental route.
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just realized that, it takes a long time to pay back a 747
should take a little less than a month of game time me thinks.
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just realized that, it takes a long time to pay back a 747
should take a little less than a month of game time me thinks.
With the math you provided, it would take that airline roughly 1200 flights to pay for that 747. That's equivalent to about 4 years of flying.
In the game, if you could get about 400k DOP with the 747, it would take just over 4 years to pay it back.