Alaska Airlines and Horizon Air 2007 Annual Report Download - page 8

Fuel Consumption by
Regional Aircraft Type
*Horizon will retire its Q200 fleet in 2009.
Based on nominal fuel burn for a trip length of 400 statute miles.
Assumes 100% load factor.
Source: Bombardier
Horizon Air Fleet
Q400
76 seats
CRJ900
88 seats
Embraer 190
99 seats
CRJ700
70 seats
Q200*
37 seats
CRJ200
50 seats
E170
72 seats
Beech 1900
19 seats
2
4
6
8
10
12
Gallons/Seat
Type of Aircraft
We are conserving fuel in other ways, too. For
example, by the end of this year almost all our
Next-Generation aircraft will have winglets, which
reduce fuel burn by about 3 percent. We’ve also
developed “Required Navigation Performance”
(RNP) procedures that save both fuel and time
through more direct flight routings, allow us to
perform constant-descent approaches, and
decrease the need to over fly destinations due to
inclement weather. Last year, the RNP
approaches we developed kept us from having to
divert more than 1,200 arrivals as a result of
weather, saving an estimated $8 million in the
process. These and other fuel-saving initiatives
significantly reduce our emissions, as well.
Revenues
It’s no secret that Alaska and Horizon serve
some markets where ticket prices do not reflect
the true cost of providing the service. With the
fuel cost increases we’ve seen over the past
couple of years — and especially during early
2008 — fares need to keep pace or profits will
continue to decline. As the industry adjusts to
recoup its cost of doing business, we’re working
to increase total revenues while providing our
customers with the services they value most.
$75
$100
$150
$50
Average Revenue Per Passenger
2001 20072002 2003 2004 2005 2006
*Includes Frontier Jet Express flying under a capacity purchase agreement.
Unit revenues and unit costs are lower for this flying than for the rest of
Horizon’s network.
$125
Horizon Air
Alaska Airlines
81
118
81
118
90
122
82
124
84*
130
92*
143
94*
145
One way we’re doing that is by tailoring
frequency and size of aircraft to better match
demand. For example, on certain routes where a
737 jet is too large to fly a convenient schedule
profitably, Horizon can serve the market with a
70-seat CRJ under contract with Alaska. We are
exploring alternatives to further improve the
profitability of Alaska’s “capacity-purchase”
routes, such as replacing CRJ flying with a more
fuel-efficient Q400, reducing the number of
flights in a given market, or possibly contracting
with a third party on a few routes if we determine
that would be optimal for the market.
4