Cargo Pay. Issue

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Brian Peace
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Cargo Pay. Issue

Post by Brian Peace » Tue Mar 17, 2009 11:53 pm

Cargo Pay - a little something ...

CYYC - CYVR with a 744F pays 96,000 (raw pay before mutlipliers or anything)
CYVR - PHNL with the same 744F pays only 156,000

CYYC - CYVR is a one hour flight
CYVR - PHNL is a 5.5 hour flight

How can 5.5 hours pay less than doing two one hour flights? See,s the farther you go with cargo the worse the profit is, and I dont think that's true in the real world, or at least not to this degree (correct me if I am wrong).
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alemaobaiano
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Re: Cargo Pay. Issue

Post by alemaobaiano » Wed Mar 18, 2009 1:50 am

It seems to be similar with our fleet, to give a few quick examples

MD-11F 216nm = Cargo income of 53.125v$ (95T)
MD-11F 1416nm = Cargo income of 123.284v$ (95T)

A310-200F 268nm = Cargo income of 26.808v$ (40T)
A310-200F 465nm = Cargo income of 38.272v$ (40T)
A310-200F 1150nm = Cargo income of 50.238v$ (40T)

A300-600F 378nm = Cargo income of 39.028v$ (47T)
A300-600F 1303nm = Cargo income of 59.762v$ (47T)

We don't do many longer flights due to real world commitments, but looking at these numbers there doesn't seem to be much incentive to go over 500nm anyway :?:

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AdmiralRolfe
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Re: Cargo Pay. Issue

Post by AdmiralRolfe » Wed Mar 18, 2009 2:28 am

It seems FSAirlines has a certain disadvantage towards longer flights (most likely since these flights are often abused by people flying many of them at 16x). The profit increase on longer flights is not significantly bigger than a medium length flight, and now there seems to be a cargo disadvantage.
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CAPFlyer
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Re: Cargo Pay. Issue

Post by CAPFlyer » Wed Mar 18, 2009 3:52 am

This is nothing new. In fact, it's covered in several locations on this forum. The first thing we need to do is remove from this discussion the notion that the duration of flight has any bearing on any FSAirlines calculation. It does not; all prices and costs are calculated based on distance.

Then, we need to understand that the increase in cost to move a given weight a given distance does not increase linearly. It is a negatively proportional curve whereby the farther the weight goes, the lower the rate at which cost increases.

There are two reasons for this -

1) The longer the flight, the larger the minimum aircraft required to make the flight. By this I mean that the longer the flight is in miles, the bigger the airplane needed to make the flight. Thus, the more payload of the aircraft flying the flight that is available for revenue. As such, you make the per weight unit cost of flying that cargo less becuase you are spreading the cost over a larger total amount of payload.

2) The longer the flight, the more efficient the aircraft. By this I mean that as the airplane flies for a longer period, it spends more time in its most efficient condition - cruise. Thus, your increase in cost does not move linearly above a certain point - the point where the time in cruise exceeds the time taken to takeoff and climb to cruise plus the time to descend and land (aka the departure and arrival phases). Thus, once you are able to cruise for longer than your departure and arrival phases, your costs stop increasing linearly since your primary variable cost (fuel) stops being consumed at the same rate. Because of this, you are unable to charge as much as distance increases since you cannot justify your price versus the cost.

If you wish to test this, call a major package shipper or go to their website. Get a quote on shipping a 1kg item 100 kilometers overnight or 2nd day. Then get a second quote to ship the same 1kg item 1000 kilometers overnight or 2nd day. You will note that the cost does not increase tenfold. It usually doesn't even double. FSAirlines does this as well.
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Brian Peace
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Re: Cargo Pay. Issue

Post by Brian Peace » Wed Mar 18, 2009 6:03 am

Fair enough. Thanks. I guess it's up to us to plan accordingly. :?
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Re: Cargo Pay. Issue

Post by alemaobaiano » Wed Mar 18, 2009 12:43 pm

Thanks for the explanation Chris, it makes sense now.

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Re: Cargo Pay. Issue

Post by CAPFlyer » Wed Mar 18, 2009 1:15 pm

BTW, since this isn't a bug, I'm moving it to the "General" forum.
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