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Comment by outericky | Hacker News Reader

According to this story [1], in 2012 airlines made just $0.37 per passenger trip. So, while I think the inefficient pricing is in need of repair, to say that prices are too high, is unfortunately not true. I hate paying for transcontinental flights as much as the next guy, but what other way can you cover 3000 miles that cheaply and quickly?

[1] http://online.wsj.com/articles/peter-thiel-competition-is-fo...

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Is that because of pricing or because of company structure/setup though? Ryanair is currently predicting 510M profit on 81M trips in Europe for 2014.

Not saying they are a model company in any way (the main thing I disagree with is some of their employee treatment), but they are certainly proving that it is possible to operate a profitable airline with low prices and high quality.

only $6.30 profit per trip and that's the best example of a profitable airline, crazy

That is on about 3-4B revenue or so though, so its actually a pretty good profit margin.

That would be only $49 in revenue per trip, seems low.

When you put it in those terms it seems almost insane. How can any company operate on such low margins? I mean, yes, the "Walmart model" is the answer, but it seems like they could go under very easily if hit by something unexpected.

> it seems like they could go under very easily if hit by something unexpected

They do. http://en.wikipedia.org/wiki/Airline_bankruptcies_in_the_Uni...

There's an old joke about this: How do you make a million dollars in the airline business? Well, you start with a billion dollars...

I have no idea how airline accounting works, but if these numbers are correct, you'd have to assume quite a bit of money collected is not counted as revenue and is going to cover direct costs like taxes.

Calling RyanAir "high quality" must be some kind of joke.

> in 2012 airlines made just $0.37 per passenger trip.

But how much of the costs are due to inefficiencies? Every time I fly, I am amazed at how long the agents have to keep typing away on their keyboards just for simple tasks.

The prices are more than we would like to pay so of course someone is screwing us. It can't just be that moving us around costs a bunch of money.

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