Fuel Prices Have Airlines Watching Their Weight
Saturday, September 10, 2005
JetBlue Airways has found a way to reduce its load and save fuel.
In earlier days -- before jet fuel prices skyrocketed -- the airline would allow its planes to hopscotch to several destinations before emptying the used water and waste in the lavatories' storage tanks, as long as the level stayed within federal health guidelines. Now maintenance workers dump the tanks after each flight.
"It keeps the weight down on the aircraft, and it saves us a lot of money," said JetBlue spokeswoman Jenny Dervin.
Jet fuel prices have soared along with oil prices -- shooting sharply higher in the wake of Hurricane Katrina. A gallon of jet fuel was selling earlier this month for $2.36, an increase of 25 percent from $1.89 during the week before the hurricane. "Simply put, today's jet fuel prices are crushing and could prove to be a knockout blow for some [airlines]," John Heimlich, chief economist for the Air Transport Association of America, wrote in a recent report.
To lighten their fuel expenses, the airlines are undertaking a variety of measures. Some of the steps may seem small, but they add up to needed savings.
Delta Air Lines has begun installing lighter seats and removing air phones from the coach sections of its MD-88s and MD-90s. It also has taken the ovens off of those aircraft because it serves fewer hot meals, said Delta spokeswoman Benet Wilson.
Alaska Airlines crews no longer keep their thick paper manuals on board, saving about $30,000 a year in fuel costs, the airline estimates.
Continental Airlines has begun adding sharklike fins known as winglets to its Boeing 757 and 737 aircraft. The devices, which are attached vertically to the wing, save on fuel by reducing drag. Continental yesterday warned in a government filing that it expects a "significant loss" for the year because of fuel prices.
American Airlines, the world's largest carrier, no longer completely fills its water tanks on its 370 MD-80 jets. With most passengers drinking bottled water onboard, American now fills the tanks to only 75 percent of capacity -- a move it expects will save about $8 million a year in fuel costs.
Many carriers already use newer, more fuel-efficient jets. To keep aircraft cooling systems operating at the gates, some airlines plug into airport electricity instead of using their own engines. Some use just one engine when taxiing on the runway.
The airlines also are raising fares to offset fuel costs -- seven times during the summer to take advantage of the seasonal swell in travel demand. Passenger loads are now slackening, and airlines no longer have as much pricing power: Several carriers, including United Airlines, tried to raise fares again last week, but the increases didn't stick.
A few carriers are strong enough financially to afford to hedge their fuel costs. But even those hedges aren't as advantageous as they once were. Southwest Airlines, which had about 85 percent of its fuel hedged at $26 a barrel, warned recently that hedging will cover only 65 percent of its fuel, and the hedge prices are increasing to $32 a barrel. Continental said yesterday that it no longer had any fuel hedges in place to protect it against further price increases.
Some carriers are being forced to eliminate high-fuel-consumption flights to less profitable destinations. Earlier this week, Northwest Airlines suspended direct service between New York's John F. Kennedy International Airport and Tokyo.
And if a flight is speeding to an early arrival, the pilot may be putting on the brakes. America West Airlines -- which is in the process of merging with US Airways -- slows its flights that are ahead of schedule in order to burn less fuel.