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SIGNIFICANCE OF VARIABLES AFFECTING PROFITABILITY OF AIRLINE
Abstract
Global event such as war, pandemic, political embargos affect overall economy of airline carrier by influencing the most important variables such as load factor or fuel prices. Aim of all companies is to be profitable, what means to cover all constant costs and fuel costs with profit from tickets which are closely linked with load factor. In this study we chose to study economic impact of COVID-19 pandemic and its effect on load factor and fuel prices and overall economy. To describe the problem, we chose yearly economy of fictive airline carrier that flies two Airbus A319 aircrafts on three routes flying from Bratislava ? BTS to Riyad ? RUH, Jeddah ? JED and Kuwait ? KWI. Data used for exemplary calculations are based on real resources during usual year and year affected by COVID-19. To describe the issue of fuel global events influencing fuel price and load factor fictive airline provider. Constant costs will be summarized and variables ? load factor, ticket price a fuel price will be calculated based on realistic indicators. As first, realistic fuel price will be used and compared to different price amounts over last year. Realistic price will be taken from one year ago, because recent pandemic of Covid1-19 virus caused 60%-80% drop in fuel price since last year. This will be only showcase of uncontrolled global events affection on fuel prices, used with real data calculations as a result. Load factor and ticket prices are important variables, where it is simple to change ticket price from the side of company and in this showcase, we will study the effect of COVID-19 pandemic effect on final economy of this company. As first, we will study fuel price evolution during COVID-19 pandemic, then we will study load effect of pandemic on load factor from realistic values from the time of its eruption and following official predictions we will calculate yearly economy results throughout the year of 2020. In conclusion, we can state that despite the bad impact of the global pandemic covid-19 on the world economy, the impact of this pandemic on nature is exactly the opposite. In the world, we can notice a trend of renewal and improvement of environmental activities.
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