ABSTRACT
Unravelling aircraft economics has always tested the mettle of fleet planners. Economics comprises two elements: cost and revenues. This chapter identifies cost components, their measurement, and how they vary according to the type of operation. It explains the effect of aircraft type on their magnitude and examines the trends in cost evolution. The chapter explores how to improve aircraft selection and assignment decisions by introducing revenues to the profit equation. It also examines some useful models to help understand aircraft positioning and profitability. The chapter addresses some new developments in economic thinking being driven by the aircraft manufacturers. The fan diagram of comparative economics can then be modified according to the number of equivalent seats in each aircraft in the comparison. Commonality between aircraft of different sizes and applications offers significant synergies to the operators of their products. Commonality can add value in three key areas: operations, flight crew and training, and spares and maintenance.
