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Old 12-02-2009 | 10:12 AM
  #9  
Climbto450
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Originally Posted by Ziggy
Floating the fleet does help. But other problems do arise. But what I'm trying to get at is the low quotes some of these organizations are able to give out. How are they covering aircraft finances, direct operating costs, fuel, crew fee's, and airport fees. Also you have to factor in some small amount for repositions. That being not all trips go out of the same airfield the aircraft are located at. I've ran the numbers for the aircraft I operate and can only go down 25% before we run into red ink. Some of the companies are running 50% below our rates. Any other idea's on how their able to offer such low prices and still cover expenses?
Some charter companies don't care about loosing money for their owners as long as they are making money for the charter department. Depending on the contract that the charter companies have with their aircraft owners 85/15 split, fixed payback cost per hour, or some variance of the two. The real problem is that a few operators are doing these trips at a loosing rate for the aircraft owner and it ruins it for everyone else. It is dragging down our industry into a norm that may be unrecoverable. If the industry would just stand up and have some backbone against these so called "brokers" (and I use that term lightly since there is no certification for brokering flight) we would see a recovery. The brokers are praying on the current economic downturn (which dosen't effect people that fly on these aircraft) to make more money off the trip. They are still charging the same rates to the end user and pitting charter company against charter company to accomplish the trip for cheeper. So if a broker sells a trip for 25,000 two years ago they would take 10 percent and find an aircraft to do the trip for 22,500. Now they can find charter companies willing to accomplish the same trip for 19,000 or even less. End result these bokers who have nothing to loose (no certificate, no employees just a labtop and a little blackbook) make more money and charter companies, who have everything to loose make less money. WE ARE ARE OWN WORSE ENEMY!!
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