Air Transport World

Burn less, save more: with oil prices nudging $50 a barrel, airlines are becoming among the world's leading conservationists.(Fuel Crisis)

Reducing airline labor costs is usually fraught with turmoil, but curtailing fuel consumption is a task on which management and labor usually can agree. For those carriers with cash in the bank, a risk management strategy involving financial instruments may be the most complete--and rewarding--way to smooth out the peaks and valleys. When prices just keep rising, however, as has been the case over the past 12-18 months, even hedging has its limitations. And many cash-strapped airlines simply lack the funds to participate.

Nevertheless, much can be and is being done operationally to at least mitigate the impact of today's high fuel prices. Among the simplest steps are reducing the ground use of APUs to supply onboard power and air conditioning in favor of ground-based power units; off-loading unneeded galleys, carts and surplus potable water, and ferrying fuel in situations where it is so expensive at the destination airport that the weight penalty is offset by the cash savings.

As the world's largest carrier in terms of RPKs and fleet size, American Airlines may burn more of the stuff than anyone else, so it is not surprising that it is leaving no stone unturned in its search for more ways to reduce fuel consumption. AA has grouped most of its activities under the "reduction of ramp arrival fuel plan," which a spokesperson characterizes "as an overall fuel management plan to ensure that each aircraft has the proper amount of fuel."

The airline estimates that it saved $38.4 million last year through initiatives such as increased use of single-engine taxiing ($2 million), reduced use of APUs ($14 million) and better flight planning and management, including reducing fuel for alternate airports ($14 million). …

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