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The US DOT updated its T6 dataset, part of Form 41 financials. You will recall that the US airline industry significantly increased pilot salaries last year. This story should be read in conjunction with an earlier post on the industry’s state.
The data reported is through year-end 2024 and provides the latest insight into how these airlines deal with the two most significant input costs: pilots and fuel. We split the airlines into categories: LCC, network, and ULCCs.
The model clarifies that the industry can offset pilot costs with lower fuel burn. That’s great -for now. Fuel costs, as you will, are highly volatile and could quickly drive the industry into the red.
Notes:
- Page 1 lists the expense categories. The upper chart shows the dollar value, and the lower diagram shows the percentages. The menu on the left allows for airline category selection. Leaving out any airline type selection, you will see how the industry’s expenses have risen post-pandemic. There has been a rise in “Trans Expense”, which the DOT defines as Transport Related Expense. Notice also the volatility in “Materials”. Aircraft fuel is the key component in this category.
- Page 2 is busy and divides the industry into airline categories. Each airline is listed to the right, with sparklines showing trends. The red dot on the park line represents the high point. The combination of pilots and fuel costs is displayed. The cost ratios tell the story, and airlines are performing quite differently. This page provides a lot of industry insight.
- Page 3 lists fuel and pilot expenses as a percentage of total operating costs. The airline categories are split to show how each is handling these factors. The divergence between LCC and ULCC is eye-opening.
- Page 4 summarises expenses, provides a “big picture” and allows you to select an airline category. The charts reinforce what you saw on the earlier pages.
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