Course Paper Pass Trans-n

8/2/2019 Course Paper Pass Trans-n

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NATIONAL AVIATION UNIVERSITY

Department of Aviation Transportation Organization

TERM PAPER

From the subject Air Passenger Transportations

Theme: Organization of Schedule Air Passenger Transportation En-route

KBP-JFK

Done by: student of the group 309

Faculty of Management and Logistics

Kiziun O.O.

Variant # 6

Supervisor: Ph.D. Tetiana A. Akimova

Kyiv 2011


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Report

This work has 38 pages includes 18 tables, 4 diagrams, 15 points of references.

The aim of this term paper is to:

to make a market research of air passenger transportation between Ukraine-USA,

development of a new flight schedule for this route, choosing to purchasing type for AC (loan or lease), calculation of cost per seat.

So in this term paper was analyzed the market of air passenger transportation between

Ukraine and the USA, were identified competitive forces already operating in this

area; defined what exactly attracts aviation passenger traffic between Ukraine and the

United States and why the development require another flight. Was also presented

forecasts for air passenger and their development prospects on the route Kyiv - New

York. Yet I was considered the main legal issues in international air law, and that all

relations between Ukraine and the USA. Finally, we designed the new schedule for

flights, have selected an aircraft, which will carry out flights on this route, it became

- Boeing 767-300ER long haul passenger aircraft, calculated the best options to

purchase aircraft, as well as the cost of one seat airplane.

Key words: aircraft, flight schedules, lease, loan, hub, conventions, treaties, air

transportation between Ukraine and the USA, legal, commercial law, the cost of

flight and the cost of an airplane seats and fare for the flight.


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Content

1. Introduction....52. Air transportation market research between USA and

Ukraine....6

3. Passenger transportation forecast........134. Legal side....155. Schedule planning...186. Selecting of aircraft............207. Calculation of the flight cost price..228. Tariff policy....369. Conclusions................3710.References...38


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Introduction

To organize the air transport of passengers successfully we need to identify the

air transportation market. Air transportation market is a set of proposed haul airline

transportation services by air and solvent demand for this type of transport. A deep

and comprehensive study of demand for air transport significantly affects the

efficiency of airline flight park, and thus the overall outcome of their financial

activities.

The major condition for the existence of aviation market is the demand for air

transportation and carriers that can provide appropriate services.

Today 11 domestic airlines have regular flights in 42 countries of the world.

Still far as to foreign airlines in terms of traffic, and on the frequency of flights. Total

volume of passenger traffic by foreign airlines on average 15% higher and in some

areas their advantage even greater. As before, the biggest volume of passenger traffic

between Ukraine and Russia, Germany, Czech Republic, Great Britain, Hungary,

Austria, Israel, Turkey, Poland, the Netherlands, the United States. In recent years,

Ukraine has gained market access to distant air. Market haul flights - in America,China, Thailand and other far countries - the last time Ukraine was unavailable. In the

absence of effective machinery passengers had transfer point in hub in Europe and

other regions. Aircraft that previously used, such as Il-62, have long been unable to

compete with Western counterparts. In addition to foreign airports to Soviet-made

equipment are being restricted flights, increasing fees for services, etc.


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Air Passenger Market Research En-route Ukraine-USA

Another stimulus to the market flights USA-Ukraine was received in 2003

after the opening of direct flights by airline Aerosvit. Nonstop flights from Kyiv to

New York Ukrainian carrier resumed four years after the termination of their state

company "Airlines of Ukraine". Then in 1999, the U.S. cut off for Il-62 of "Airlines"

as such does not meet the country introduced the environmental and noise restrictions

for aircraft.

Aerosvit took into account the lessons of predecessors for reclaiming of

Transatlantic it started to operate long-haul Boeing-767 and began to build an

extensive network of ticket sale to the U.S.. At the same time to cooperate actively

involved in the sale of ethnic agencies that worked with former compatriots. As a

result, less than a year on its flights from New York Airport.after Jh. Kennedy to

Boryspil, company managed to attract the "Ukrainian" passenger, who was

previously distributed between foreign carriers (Lufthansa, Czech Airlines, Air

France, British Airways, Austrian Airlines and others).

Of course, the opportunity to expand its presence in the Ukrainian sectorbenefited Transatlantic and European airlines. They, with the consent of the aviation

authorities of Ukraine, twice or three times increased the intensity of flights between

Boryspil and airport-based (Munich, Vienna, Paris, Amsterdam, London). As a result

of increased outflow of Ukrainian passengers on flights to North America via Europe

"hubs". American Airlines also did not hide intentions to gain a foothold in Europe

and in Ukraine in particular. But until recently to open non-stop flights to Kyiv mostplayers do not dare. At the Ukraine-USA they would prefer to work together with its

European partners in air alliances: Europeans took out his base in Kiev "hub", and

Americans - were transported across the Atlantic. The first overseas companies to

own land on the market, New York - Kyiv was used Delta Airlines.

Let`s analyze the dynamics of GDP growth in Ukraine and New York.

According to State Statistics Committee of Ukraine have the following

characteristics:


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Years GDP mln.$

2000 170070

2001 204190

2002 225810

2003 267344

2004 345113

2005 441452

2006 544153

2007 720731

2008 948056

2009 914720

Table 1

Dynamic of GDP Growth in Ukraine

Diagram 1

y = 92790x - 32179

R = 0.9204

0

200000

400000

600000

800000

1000000

1200000

1400000

200120022003200420052006200720082009201020112012

Series1Linear (Series1)


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According to American web-site of statistics there is following data

Years GDP bil.$

2003

13596

2004 13658

2005

13795

2006

13 892

2007 13928

2008 14 060

2009 14 002

2010 14560

Table 2

Dynamic of GDP Growth in USA

Diagram 2

While analyzing this data we can see that GDP tend to growth. Trade and

cooperation between USA and Ukraine develop very fast. Lets consider goods

turnover between this two countries.

y = 76.964x + 13539

R = 0.9245

13200

13400

13600

13800

14000

14200

14400

2003200420052006200720082009201020112012

Series1

Linear (Series1)

Linear (Series1)


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Export (k.USD) Import (k.USD) Goods turnover(k.USD)

2001 124100,0 278400,0 402500,0

2002 134100,0 210000,0 344100,0

2003 178900,0 253800,0 432700,0

2004 242800,0 202900,0 445700,0

2005 281400,0 312700,0 594100,0

2006 316100,0 277100,0 593200,0

2007 407904,2 310776,5 718680,7

2008 551390,0 319483,5 820873,5

2009 441454,9 302327,3 743782,2

2010 500256.0 345748.3 800345.3

Table 3

Dynamic of Goods Turnover

Diagram 3

We see the trend of growing goods turnover between Ukraine and USA. It

means the development of economic relationships between countries. On passenger

y = 61915x + 262161

R = 0.9215

0

200000

400000

600000

800000

1000000

1200000

200120022003200420052006200720082009201020112012


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turnover and passenger flow a number of socio-economic factors have influence. The

greatest amount of people which travel are after 35 years old.

Entry of foreigners from USA to Ukraine from 2006 till 2009

Amount

of

foreigne

rs came

to

Ukraine/

Total

:

Officials,

diplomatic

Turis

m

Private Educ

ation

Working Immigration Sport&cult

ural

exchange

2006 113507 18730 41420 46512 181 39 267 6358

2007 132376 19828 50266 55871 323 55 371 5662

2008 128122 19551 50698 52741 158 46 401 4527

2009 123001 14120 49284 53505 150 49 70 5373

2010 129901 15070 50684 56705 201 35 80 5697

Table 4


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Tariffs and Flights Proposed by Competitors

Economy class

Table 5


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Business Class

Table 6


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Let`s review a schedule of flights en-route New-YorkBoryspil using AmadeusGDS

Table 7

Comparing the prices of airlines Aerosvit offers tariff, which is in fairly

low price category, which is more attractive to passengers who travel on this route

New-York Boryspil. We see that the only company Aerosvit provides direct

flights, while other airlines are doing transplants in Europe, the passengers take

precious time. But the airline Aerosvit no flights on Mondays, and we will correct

it.


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Passenger Transportation Forecast

Scientific forecasting has many methods and techniques of forecasting: the

forecast trend, econometric relations and industrial surveys and market

conditions. The basis of forecasting the volume of passenger traffic should use an

integrated method based on systematic analysis of all interacting factors. At the same

time in this forecast should take into account the coordination of demand and the

possibility of its software. Economic and geographic research to enable the growth

trends in population, its movement and the need for change in the future in the region.

Consider the direction of the US-Ukraine.

Dynamic of Passengers Transportation Growth from US to UA

Diagram 4

Based on diagram 4, we see in terms of trend lines that will increase the

number of passengers annually. Most passengers arriving for tourism, business and

individual needs and business reasons. There is a considerable number of citizens

interested in direct flights to New York because this city home to many immigrants

from Ukraine. In addition, New York - the world's business center.

2010 was for New York to a record number of tourists visiting it. Procedure

10 million foreign and 30 million Americans have decided to look at the largest city

in the U.S.. Also, in New York often are different measures and actions that attracttourists worldwide. Analysis of statistical data on GDP and trade are making a

definite conclusion that the economic relations between developing countries and the

y = 29221x + 11069

R = 0,936

100000

105000

110000

115000

120000

125000

130000

135000

2006 2007 2008 2009 2010 2011 2012

Series1

Linear (Series1)


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trend observed in the future. Forecast of traffic on this route determines the increase

in the number of passengers who use the route. The route Kyiv - New York from

Ukrainian airline serves Aerosvit - Ukrainian Airlines ". Regular non-stop flights

between the capital of Ukraine and New York (USA) performed five times a week

medium-haul Boeing 767. From Kyiv airplane flying on Tuesdays, Thursdays,

Fridays, Saturdays and Sundays and from New York - on Tuesdays, Thursdays,

Fridays, Saturdays and Sundays. Aerosvit, the largest Ukrainian airline, serves 31

international and 7 domestic air routes. With nonstop flights of foreign airlines do not

do anything. All they do on Kyiv - New York with one or two stops (usually the

Amsterdam, Frankfurt, Zurich, Paris, London). After analyzing traffic flow data in

the country, shows that in 2011 it observed about 125 thousand passengers, in 2012.150000. In 2013. - 185 thousand passengers.

For this route Kyiv-New York, given that there are 5 flights per week on

Boeing 767 (the number of passengers in mixed class cabins - 211). Given that the

payload is equal to 100%, then a week receive 725 passengers carried, in the year

(multiplied by 52 weeks) - 37 700 passengers. The difference between the passengers

carried in 2009 and 2011 will make predictable 10 474 passengers per year. If we

divide the 52 weeks we will get an average of 250 people.


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Legal Side

In the field of European integration for Ukraine is an important support from

international partners who have extensive experience in strengthening and developing

democratic institutions and building a market economy. Particular attention in this

regard deserves assistance granted to Ukraine during the reporting term strategic

partners - the U.S. and Europe. There were historic strengthening of strategic

partnership between Ukraine and the USA. Its basis is today the agreement will be

recorded in the Joint Statement "of the new century agenda for Ukrainian-American

strategic partnership" adopted by the presidents of Ukraine and the United States 4

April 2005 in the course of the visit of President of Ukraine Victor Yushchenko to the

USA. Now this statement made by 90%. Among the major achievements of the

Ukrainian-American partnership for the period then ended, entails the following:

granting Ukraine the status of the U.S. Government market economy;

sign a bilateral protocol between Ukraine and the United States on the

conditions of market access for goods and services in preparation for our state to join

the World Trade Organization;

cancellation of Ukraine on the Jackson-Vanik;

lifting trade sanctions against Ukraine and the resumption of benefits under

the Generalized System of Preferences trade in the U.S.;

revitalization of the simplification of visa regime for citizens of Ukraine to

increasing contacts between citizens of both countries.

Jackson-Vanik Rectification

In October 2004, restrictions were introduced in the development of flights

between Ukraine and the USA. Sanctions against our country was initiated by U.S.

Federal Aviation Administration ( FAA) for the audit of the State. FAA then decided

that Ukraine "does not comply with international safety standards set by International

Civil Aviation Organization (ICAO) a number of criteria". As a result, our country

FAA safety rating was lowered from the first category to another.


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International Agreements

International air transportation regulate several multilateral

agreements. Among them are Chicago Convention on International Civil Aviation of

7 December 1944., Ratified by Ukraine on August 10, 1992 and for its effect from 9

September 1992 p. It was a compromise agreement between the states that

participated in its preparation. Standards of the Chicago Convention Protocol

complements the introduction of new 83-rd article of the Convention on International

Civil Aviation, ratified by Ukraine on February 15, 1995.

The Convention is the basis for national standards. Having established the

principle of recognition of state sovereignty, the Convention reaffirmed this right of

each State to regulate air traffic within its territory, the business of motor transport

enterprises and exercise jurisdiction over the traffic. The Chicago Convention sets

general requirements of civil aviation in international flights. It is about principles

and rules of flight, aircraft registration and documentation, investigation of air

accidents, the procedure for establishing technical standards.

Effective regulation of air transportation made possible by the activities ofinternational organizations. One of the first established international air transport

association (1919). In the early 40's to her were the largest U.S. and European

airlines. In 1945 this association was reorganized and adopted its new Constitution. It

brought together the leading airlines in Europe, USA, Asia and Australia. Association

should promote safe, regular and economically beneficial for States flights. To this

end, it was adopted only provided transport (1927), the form of tickets and baggagereceipts, bills of lading (1929), conditions of carriage of passengers and baggage

(1954) and others.

Creation in 1944 p. intergovernmental specialized agencies - the International

Civil Aviation Organization (ICAO), which started operations in 1947 p., led to joint

efforts to resolve the airlift of more than 160 countries. According to Art. 1944

Chicago Convention and the Charter Organization ICAO promotes the development

of international civil aviation, developing guidelines and standards for traffic rules,

maintenance of aircraft, promotes safety on international air routes.


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The main international agreement that defines the conditions of air transport

passengers and cargo, is the Convention for the Unification of Certain Rules Relating

to International Carriage by Air signed at Warsaw October 12, 1929 (Warsaw

Convention 1929).. Ratified by Ukraine on August 14, 1959 it came into force for it

on November 14, 1959 Warsaw Convention 1929 supplemented and modified signed

September 28, 1955 Hague Protocol of Amendment to the Convention for the

Unification of Certain Rules Relating to International Carriage by Air signed in

Warsaw on 12 October. Hague Protocol became effective for Ukraine 19/10/1960

Warsaw Convention 1929 complements the so-called Guadalajara Convention, in

addition to the Warsaw Convention for the Unification of Certain Rules Relating to

International Carriage by Air performed by a person who is not a carrier under thecontract. Ukraine signed the September 18, 1961 ratified September 5, 1983, and on

January 15, 1984 it has become effective for Ukraine. Supplementing the Convention

and Protocol of Guatemalan March 8, 1971. This protocol was an act aimed at

improving air carrier liability to passengers. Rome Convention on Damage Caused,

Foreign Aircraft to Third Parties on the Surface of 7 October 1952, to which, among

other countries was the Soviet Union from 1982.


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Schedule Construction

The route Kyiv - New York from Ukrainian airline serves Aerosvit. Regular

non-stop flights between the capital of Ukraine and New York (USA) performed five

times a week medium-haul Boeing 767. From New York AC fly on Tuesdays,

Thursdays, Fridays, Saturdays and Sundays, from Kyiv, in those days. Slots are place

in the timetable, schedule of take-offs-landing at the airports of departure and

destination. Regulatory allocation of slots for most of the national distribution

systems, recommendations were IATA. These rules are formulated in Worldwide

Scheduling Guidelines. There is a considerable number of citizens interested in direct

flights to New York because this city home to many immigrants from Ukraine. In

addition, New York - the world's business center. For this reason, I believe that to

create another plane for people who fly in for the most part (the beginning of the

business week). And anyway, in my opinion, departing early in the week better than

the middle of it.

These regular nonstop flights between Kyiv and New York will be operated

once a week medium-haul Boeing 767-400ER.

Flights from KBP to JFK

Flight Departure Destination Take-off Landing Flight days A/C type

VV424 KBP JFK 06:00 15:00 Mon 767-400ER

Table8

Flight from JFK to KBP

Flight Departure Destination Take-off Landing Flight days A/C type

VV424 JFK KBP 00:10 09:10 Mon 767-400ER

Table 9


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Aircraft Choosing

Choosing of A/C is a very important and difficult task that can be performed on

different reasons. For development of a new flight we choose Boeing 767-400ER.

Let`s compare technical and economical indices of an aircraft. We willcompare Boeing 767, Boeing 767-300ER, Boeing 767-400ER, Boeing 777-200,

Boeing 777-300.

A/C Technical Characteristics

1. Boeing 767 (price 27-80 m $, depending on the year of production)

Table 10

2. Boeing 767-300 ER (price 47-107 m $, depending on the year of production)

Table 11

3. Boeing 767-400ER (price 108-136 m $, depending on the year of production)


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Table 12

4. Boeing 777-200 (price 128-146 m $, depending on the year of production)

Table 13

5. Boeing 777-300 (price 151-170 m $, depending on the year of production)

Table 14


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Flight Cost Price Calculation

(variants: loan or lease)

Data for calculation of A/C taking in loan or lease

Price of new A/C125 m. USD (Boeing 767-400ER) and 75 m. USD (Boeing 767-300ER)

A number of paying quarters for a period of 5 years

Loan percentage rate13%

VAT20%

Average year loan rate - 15%

Depreciation10%

Credit

Calculation of loan suppose an every month payments for percentage of

loan .

Amount of the next payment is:

V = pV/n,

where pVprior amount of loan

nnumber of years

Amount of the next payment in percentage is:

I = pV*rate,

where rateyear percentage rate.

Composition of annual credit paying off table

# of paymentDebt on credit, m.

USDPercentage payment

Credit payment,

m.USD

Total payment, m. USD

1 125 16,25 2541,25

2 100 13,00 2538

3 75 9,75 2534,75

4 50 6,5 2531,5


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5 25 3,25 2528,25

Total: 48,75 125173,75

Table 15

The calculation of per cents for credit on purchasing of Boeing 767-400ER

the amount of USD 173,75 millions will be spend.

paymentDebt on credit, m.

USDPercentage payment

Credit payment,

m.USD

Total payment, m. USD

1 75 9,75 1524,75

2 60 7,8 1522,8

3 45 5,85 1520,85

4 30 3,9 1518,9

5 15 1,95 1516,95

: 29,25 75104,25

Table 16

Leasing of aircraft

. Coordination of the method of calculating the lease payment, you can: -

Financial leasing with full amortization; operational leasing.

Calculate the lease payment on a financial lease with full depreciation.

Calculation of the total lease payments made by the formula:

LP = DC + PC + CL + VAT,

where DC - depreciation;

PC - a charge for using credit;

CL - commission lessor;

VAT - Value Added Tax.

Calculation of the Average Annual Cost for Aircraft Boeing 767-

400ER

Period

Price of A/C on the

year beginning m.

USD

Depreciation, m.

USD

A/C cost in the

year end

Year average price

of A/C, m. USD


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1 125,0 12,5 112,5 118,75

2 112,5 12,5 100,0 106,25

3 100,0 12,5 87,5 93,75

4 87,5 12,5 75,081,25

5 75,0 12,5 62,5 68,75

Table 17

Calculation of the Total Lease Payments

1st

year

DC = 125 *10% = 12,5

PC = 118,75*0,13 = 15,44

CL = 118,75*0,15 = 17,81

E = DC + PC + CL = 12,5+15,44+17,81 = 45,75;

Where E are earnings from lease.

VAT = E*0,2 = 45,75*0,2 = 9,15

LP 1= 45,75 + 9,15 = 54,9.

2nd year

PC = 106,25*0,13 = 13,81

CL = 106,25*0,15 = 15,94

E = 12,5+13,81+15,94 = 42,25

LP2 = 42,25 +20% = 50,7

3rd

year

PC = 93,75*0,13 = 12,19CL = 93,75*0,15 = 14,06

E = 12,5+12,19+14,06 = 38,75

LP3 = 38,75+20% = 46,5

4th

year

PC = 81,25*0,13 = 10,56

CL = 81,25*0,15 = 12,19E = 12,5+10,56+12,19 = 35,25

LP 4 = 35,25+20% = 42,3


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5th

year

PC = 68,75*0,13 = 8,94

CL = 68,75*0,15 = 10,31

E = 12,5+8,94+10,31 = 31,75

LP 5 = 31,75+20% = 38,1

LP = LP 1+ LP 2+ LP 3+ LP 4+ LP 5, so

LP = 54,9+50,7+46,5+42,3+38,1 = 232,5 (m. USD).

After calculation performance it`s became clear that credit will cost USD

173.75 millions and lease will cost USD 232.5 millions. Hence, it is cheaper to take a

credit, rather than to lease an aircraft.

Calculation of the Average Annual Cost for Aircraft Boeing 767-300ER

Period

Price of A/C on the

year beginning m.

USD

Depreciation, m.

USD

A/C cost in the

year end

Year average price

of A/C, m. USD

1 75,0 7,5 67,5 71,25

2 67,5 7,5 60,0 63,75

3 60,0 7,5 52,5 56,25

4 52,5 7,5 45,0 48,75

5 45,0 7,5 37,5 41,25

Table 18

Calculation of the Total Lease Payments

1st year

DC = 75 *10% = 7,5

PC = 71,25*0,13 = 9,26

CL = 71,25*0,15 = 10,69

E = DC + PC + CL = 7,5+9,26+10,69 = 27,44;

Where E are earnings from lease.

VAT = *0,2 = 27,44*0,2 = 5,48

LP1= 27,44 + 5,48 = 32,9.


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2nd

year

PC = 63,75*0,13 = 8,28

CL = 63,75*0,15 = 9,56

E = 7,5+8,28+9,56 = 25,3

LP2 = 25,3 +20% = 30,4

3rd

year

PC = 56,25*0,13 = 7,31

CL = 56,25*0,15 = 8,44

E = 7,5+7,31+8,44 = 23,25

LP3 = 23,25+20% = 27,9

4

th

yearPC = 48,75*0,13 = 6,34

CL = 48,75*0,15 = 7,31

E = 7,5+6,34+7,31 = 21,2

LP4 = 21,2+20% = 25,4

5th

year

PC = 41,25*0,13 = 5,36

CL = 41,25*0,15 = 6,19

E = 7,5+5,36+6,19 = 19,05

LP 5 = 19,05+20% = 22,9

LP = LP 1+ LP 2+ LP 3+ LP 4+ LP 5, so

LP = 32,9+30,4+27,9+25,4+22,9 = 139,46 (m. USD).

After calculation performance it`s became clear that credit will cost USD

104.25 millions and lease will cost USD 139.46 millions. Hence, it is cheaper to take

a credit, rather than to lease an aircraft.

Calculation of direct fixed costs for flight Kyiv - New York includes the

following components:

Calculation of airlines cost for operating aircraft. Determination of operating

costs fleet is one of the most important tasks in cost calculations.


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restoration of basic production funds (BPF) BPF repair costs, contributions to

government social insurance, taxes, costs for energy and other items costing.

Cost of flight hours of aircraft Boeing 767-400ER and Boeing 767-300ER

depends on the conditions of commercial contracts with suppliers and therefore

cannot be reliably determined during the preliminary investigation. Is subject to the

global average lease prices, this figure will be about 9500USD for the Boeing 767-

400ER and Boeing 767-300ER.At international airlift aircraft should have available

the following types of insurance needed:

insurance airplane,

insurance of the crew, including flight attendants,

insurance of damage caused to third parties on the surface,

insurance of damage caused to passengers.

Costs for the refueling aircraft fuel (KBP). The cost of aviation fuel is one of the

main items of expenditure. Fuel consumption depends on the height of flight take-off

weight, duration of maneuvering after takeoff and before landing, the duration of the

engines on land as well as the optimal shutter speeds on the stages of flight. In

addition, through a special value that gets deleted fuel at high fuel prices on the world

market, special attention should be given to calculate the most economical refueling

aircraft on the route. The cost of aviation fuel in the various suppliers are not

equal. Yes, you can roughly say that the cost of one ton of kerosene is 700USD.

1. Fuel Costs for F&L. Complete filling the whole range of non-stop route use

for flight route Kyiv - New York. In this case, fuel costs are determined by the

formula:

fuel= [(Qland+ Qtake-off-landing).P+ qh

.flight

.P]

.Kl

fuel= (4,5*700+4,3*9*700)*7= USD 211680,

(1)

Where fuel(-jfk) costs on F&L en-route KBP-JFK

Qlandland fuel consumption


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Qtake-off-landing fuel for landings, take-offs etc.

qhfuel consumption per hour t/ h

flighttime of flight KBP-JFK;

Pfuel price USD;

Klcoefficient which takes into account price of lubricants.

Sum ofQland Qtake-off-landing is 4,5 tons for Boeing 767-400ER and Boeing

767-300ER. Data on qh: 4,3 t/h - Boeing 767-400ER, . Price of lubricants is equal to

1 % of fuel according to flight.

2. Cost on Labor Remuneration

W crew=(Hour-paid wage.* / Hours flown+h*)Ncrew. (2.1)

W crew =(2500*9 /72+200*9)*2=4225 USD

where W crewcrew wage,

flight time,

h -crew rate by hour

Ncrewnumber of crew.

W f.a.=( Hour-paid wage * / Hours flown+h*)Nf.a. (2.2)

W f.a. =(100*9 / 72+20*9)10=1925 USD)

Where W f.a.flight attendance wage

- flight time,

h -flight attendance rate by hour

Nf.a.number of flight attendance.

3. Other Direct Costs

Cost of A/C overhaul ( ):


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100flTyear

AcNd= 9

100585

.1251,0

usd1917 for(Boeing 767-400ER) (3.1)

9100585

751,0

m = 128,2 for (Boeing 767-300ER) (3.2)

Nddepreciation norm-10%

AcA/C price .,

Tyear flnumber of year flights h.

Costs for Technical Maintenance (M):usd 5,670935,01917Kt.m for Boeing 767-400ER (3.3)

usd 83,403935,02,128Kt.m for Boeing 767-400ER (3.4)

Kt.m.coefficient which takes into account costs on tech. maintenance and overhaul-

35%

Costs for Social Needs:Cs.n.= W*Kd=4225*42%+1925*33,2+6150* 0,096%=2419,5 USD (3.5)

were Kd deduction on social needs :

o For flight attendance 33,2%o For crew42%o Deduction on accidences and diseases ( class of dangerous 190,096%)

4. Airport Charges

KBP. Airport taxes set of recommendations offered by ICAO. Specially not less each

state or airport can make their own features to the rules of calculating the user

charges. Rates and fees from the airport operators KBP established order number 459

of the Ministry of Transport of Ukraine on 12.29.1997.

Take-offLanding Charge:Ct.l.= Ca/p

.Gmax

Ct.l.=11*204,12=2245,32 USD for Boeing 767-400ER (4.1)


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Ct.l.=11*184,6=2030,6 USD Boeing 767-300ER (4.2)

Where Ct.l. is Airport Boryspil Charge for landings and take-offsUSD;

Ca/p- rate of charge according to MTOW = 11 USD in KBP

Gmax - MTOW

Land Service charge Cl= 540USD. Costs on Crew Meals:Cmealcrew=Ncrew Smealcrew (4.3)

Cmealcrew =12*20=240 USD

where Cmealcrew costs on crew meals in KBP USD;

Ncrewnumber of crew

Smealcrewmeal price USD 20

Lease of one check-in desk = USD 100, and USD 10 for press.

JFK Take-offLanding Charge:

Ct.l.= Ca/p.Gmax

Ct.l.=15*204,12=3061,8USD for Boeing 767-400ER (4.4)

Ct.l.=15*184,6=2769 USDBoeing 767-300ER (4.5)

Ca/p=15 for each ton of MTOW

Tax for F&L Burning (Cf&l) fixed charge 150USD. Aviation security (Csec)charge is 150 USD.

Costs on Crew Meals:Cmealcrew=Ncrew Smealcrew (4.3)

Cmealcrew =12*35=420 USD

where Cmealcrew costs on crew meals in JFK USD;


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Ncrewnumber of crew

Smealcrewmeal price USD 35

Cost for press USD 10.

Territory overfly charge.

50

GbTDR ;

100

.7525D ;

50

GbTDR

50

12025,75*35 =4080USD for Boeing 767-400ER (4.7)

50

GbTDR =35* 75,25

50

94=3611 USD for Boeing 767-300ER (4.8)

unique charge for service on every 100 km of orthodromic distance ( 35 USD)Dorthodromic distance

GbMTOW

1. 5. Costs on Crew Dispatching.Cdisp=Ncrew

.Ndays

.Cday + Ncrew

.Ndays

.Cday2 (5)

Cdisp = 12*1*43+12*1*35=936 (USD).

2. Cdispcosts on crew dispatching USD;3. Ncrewcrew number;4. Ndays-number of dispatching days;5. Cday1daily dispatching money ;6. Cday2 - daily living price in hotel per one person35USD.7. Transportation costs of crew are 120 USD.6. Obligatory Aviation InsuranceAins=(Iac+Icrew+TPLL+PLL)*/Tyearflight (6)

Ains.=(24000+100000*2%+10000000*1%+100000*1%)/585=260 USD

Ainsobligatory aviation insurance

Icrewcrew insurance is 2 % from 100000 USD in USA,

TPLLthird parties legal liabilities


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PLLpassengers legal liability

7. Variable Costs Calculation

Variable Costs in KBP Charge for Passengers Serving in Air TerminalCserv = Npass

.Cterminal

Cserv =250*13 = 3250 USD

Cserv=charge for passengers ssevice

Cterminal=charge per one passenger

(7.1)

Aviation SecurityCsec= Npass

.Csec

Csec = 250 * 4 = 1000 USD

(7.2)

Csecaviation security charge

Csec = rate of charge

Passegers meals cost on boardCpassmeal = NpassY

.CmealY+ Npass

.CmealC

Cpassmeal = 375*10 + 59*15=4635 USD for Boeing 767-400ER

(7.3)

Cpassmeal = 290*10 + 70*15=3950 USD for Boeing 767-400ER

(7.4)

NpassY economy class passengers(375);

CmealYprice of economy meal 10USD;

Npassbusiness passengers (59)

CmealCprice of business meal 15USD.

Charge for Passengers Serving in Air Terminal JFK


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Cserv = Npass. Cterminal (7.5)

Cserv =(250+250)*15=7500USD

Passegers meals cost on board

Cpassmeal = NpassY. CmealY+ Npass

. CmealC

Cpassmeal =375*9+59*15= 4260 USD for Boeing 767-400ER

(7.6)

Cpassmeal =290*9+70*15= 3660 USD for Boeing 767-300ER

(7.7)

Calculation of variable costs for airlines is depending on the commercial load on the

tracks. Accounting or variable costs should lead promptly to each particular flight

charges of resuming them.

Direct Constant-Conditional Costs

CC=236779,12 USD for Boeing 767-400ER (8.1)

CC=232137,13 USD for Boeing 767-300ER (8.2)

Variable Costs

VC = 20645 USD for Boeing 767-400ER (9.1)

VC=19360 USD for Boeing 767-300ER (9.2)

Seat Price Cost

SPC = (CC + VC)/2*Npass

SPC =(236779,12+20645)/(2*375)= 343USD for Boeing 767-400ER economy class

(10.1)

SPC =(236779,12+20645)/(2* 59)=2181 USD for Boeing 767-400ER business class

(10.2)


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SPC=(232137,13+19360)/(2*290)=403,6USD for Boeing 767-300ER economy class

(10.3)

=(232137,13+19360) /(2*70)=1796,4 USD for Boeing 767-300ER business class(10.4)

As for the additional flight we purchased the airplane in credit, we have to

consider it in the ticket:

First, calculate for the Boeing 767-400ER:If a loan of 173.75 million USD, then

divide the period of 5 years, it will reach 34.7 million USD for 1 year. The number of

flights equals 104, so on one flight be broken in the amount of 59 315 USD. Then, if

we fly economy class, then divided by 375 seats, will get 159 USD, and when the

business class, then divide by 59 seats respectively, and receive 1005 USD. So add

the cost of one place and get:

economy class 343+159=502 USD

business class 2181+1005 = 3186 USD

Now calculate for the Boeing 767-300ER:

If a loan of 104.25 million USD, then divides the period of 5 years, it will be

20.85 million USD for 1 year. The number of flights equals 104, so on one flight be

broken in the amount of 36 260 USD. Then, if we fly economy class, then divide by

290 seats, will get 125 USD, and when the business class, then divide by 70 seatsrespectively, and receive 518 USD. So add the cost of one place and get:

economy class 403,6 +125 = 528,6 USD

business class 1796,4 +518 = 2314,4 USD


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Tariff policy

Tariff policy is quite important for the transport sector, since it depends on

income and development. But it should not be interconnected with the improvement

of services provided to citizens. In the field of tariff policy provides: provide free

transport pricing in the market sectors with a high level of competition; to monitor

actual costs and profitability of transport companies - monopolies; to establish, if

necessary fixed rates for transportation services of natural monopolies, coordinating

activities with other tariff regulation stimulating and restrictive measures; delimit the

powers of tariff regulation between state and regional levels of the transport system;

ensure the improvement of tariff policy and maintain a single tariff area in

accordance with intergovernmental agreements on a concerted policy to determine

transport rates.

Main improvement of the tariffs should be their differentiation by class

differentiation quality of transportation and other forms of transport in young men,

consistent end the practice of "transitional" funding and subsidies to loss-making

business through cost-effective. Reform of the tariff policy requires improvement of

tax legislation. To calculate the cost of the flight, we should add to the cost rate of

return. We receive a percentage of profitability by 20%. Then the fare for passengers

on flight Kyiv - New York be for Boeing 767-400ER.

For economy class USD 602

Business Class 3823 USD.

Boeing 767-300ER

For economy class 634,2 USD

For business-class 2776,8 USD. Since this plane was designed primarily for

business travel, then select the aircraft Boeing 767-300ER, where the cost of business

class is smaller than if we carry on the Boeing 767-400ER. While using aircraft

Boeing 767-300ER for economy class will go to $ 30 overpayment.


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Conclusion

After reviewing all the data we conclude that the aircraft industry is developing,

despite the global crisis. While incurred significant losses, many economic indicators

fell sharply down, the market begins to airlift out of the crisis and continues to

develop. We observe very high rates of turnover, passenger turnover between the

countries. In this case I had researched the market for air transport route - Ukraine

USA. By making analysis and forecast for this area, they saw a clear tendency to

increase economic relations. After reviewing all the indicators, I decided that it

should open a new flight from Kyiv - New York, because in this city live. Also, in

New York often are different measures and actions that attract tourists

worldwide. This year also occurred action designed to promote certain areas of New

York.

Another reason for choosing this direction is that all airlines except Aerosvit the

transport along the route with stops only in some cases even two. A lot of people

interested in non-stop flights. But in Aerosvit no flights on Mondays, and this is the

beginning of a new week. In order to develop new flight route found that the

purchase of new aircraft, according to calculations concluded that the better buy

Boeing 767-300ER. Computing the cost of leasing and credit, concluded that more

profitable to purchase aircraft loans, because if us take on lease, the overpayment is

almost doubled. For loans to 104.25 million USD will cost airlines, and taking on

lease - 232.5 million USD. Having developed a new flight, calculate the tariff which

will be for economy class passengers 602 USD, business-class 3823 USD. This is

somewhat less than competing airlines.


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References

1. : / .. . .:, 2008. 124 .

2. .. : . .: "" : . ., 2007. - 462 .

3. www.aerosvit.com4. www.ukrstat.gov.ua5. uastocks.com/macro6. www.america.gov/ru7. http://www.ukraviatrans.gov.ua8. www.airwar.ru9. www.newyork-info.ru10. www.mintrans.gov.ua11. http://www.airticketua.com/direction/kiev_new_york12. http://www.ereport.ru/stat.php13. http://www.forumavia.ru/14.

153 18.02.2006.

15. 459 29.12.97 .
http://www.aerosvit.com/http://www.aerosvit.com/http://www.ukrstat.gov.ua/http://www.airwar.ru/http://www.airwar.ru/http://www.mintrans.gov.ua/http://www.mintrans.gov.ua/http://www.airticketua.com/direction/kiev_new_yorkhttp://www.airticketua.com/direction/kiev_new_yorkhttp://www.ereport.ru/stat.phphttp://www.ereport.ru/stat.phphttp://www.forumavia.ru/http://www.forumavia.ru/http://www.forumavia.ru/http://www.ereport.ru/stat.phphttp://www.airticketua.com/direction/kiev_new_yorkhttp://www.mintrans.gov.ua/http://www.airwar.ru/http://www.ukrstat.gov.ua/http://www.aerosvit.com/

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