The extraordinary occurrences in an ordinary life.
18th
FEB
Dry Skies
Posted by snow under Blog
During my most recent international flight of ~3000 miles, American Airlines didn’t serve drinks for it’s passengers for free. Instead, they were asking for $1 per drink. I gauged my personal reaction and did the math. It didn’t seem like a good business move..
The problem is not that $1 is a ridiculous price to charge for a drink, but the ingrained concept that drinks should be free on a flight, that they are bundled into our seat price. Of course, we can rationalize this by thinking “the ticket was cheaper”, but it leaves a poor impression. More importantly, judging by how few people asked to buy drinks, people are generally thrift in this issue and would rather bear the discomfort of slight dehydration than pony up $1 for a coke. These two cause me personally to feel dissatisfied with the service both physically (being less hydrated) and mentally (feeling ripped off). This is worsened by the ban (or nuisance of bringing) liquids onto airlines. While the actual demand for the drink may be several dollars, the price passengers are willing to pay is very low. This is a very dangerous situation for a merchant.
I did the calculations, It costs the airline roughly $0.62 per passenger to provide everyone who wants a drink a drink (excluding those who bought a drink). In my opinion, American Airlines is giving it’s customers an impression of a stingy company that’s uncomfortable to ride with at the gain of less than a dollar per traveller, a deal I wouldn’t make.
Assumptions for Calculating $0.62:
- 1 can of coke is 241 grams (http://wiki.answers.com/Q/How_much_does_a_can_of_soda_pop_weight)
- 150 people on the plane
- 125 cans of soda is consumed
- with paying, 25 cans of soda is consumed (roughly from my tally on my flight)
- 42.8MJ/kg for kerosene (http://en.wikipedia.org/wiki/Energy_density)
- 1.1 MJ / available seat kilometer (http://www.transportenvironment.org/Publications/prep_hand_out/lid:398)
- each seat is roughly 80 kg
- price of kerosene: $1.31/gal (http://tonto.eia.doe.gov/dnav/pet/pet_pri_spt_s1_d.htm)
- assume price of drinks is $0.5 per can
cost of shipping the drinks is: 43.26
cost of drinks: $50 -> 93.26 more per flight, or 0.62 per ticket
Reader's Comments
Leave a Reply
Post Meta
-
February 18, 2009 -
Blog -
3 Comments
-
Comments Feed
…..ur one crazy dude.
I think the airline’s decision makes sense(not that I’d like to support it). The competition in the air hasn’t gotten tough to the point the passengers have many choices. Most of time, people choose the airline that meets the time constrains. Therefore, unless an airline can provide luxury service with lower than average price, it is unlikely this airline can gain any significant competitive edge by improving services.
But I assume the water is still free right?
Water was not free. But you bring up a good point, the timetable. In my case, it was because of the timetable. But, for normal trips where i’m not bound by a tight schedule, or if the schedules are similar, i think the airline will lose out.