Can somebody please explain the Capital Cost Column in the Aircraft type evaluation tool?
Thank you
I believe it's the cost of a "new" aircraft's lease divided by the number of flights per week. For example, I checked on a Boeing 737-800 BGW. Its new lease cost is 280,000 a week. The number of flights is 28, so the capital cost is just a tad over 10,000.
Note that it seems to have the same cost no matter the age of the aircraft you put into the evaluation. You probably aren't going to pay 280,000 per week for a 10 year old 737-800. So it's highly variable.
The Aircraft Type Evaluation was the perfect tool in the pre-bidding market game. Just a few slight manual adjustments needed to make it work properly now...
I usually adjust it in my head by doing the following:
1) Find an aircraft you'd consider leasing and note down the age and leasing cost
2) Enter the data into Aircraft Type Evaluation with the correct age (the same of the leasing aircraft you've seen)
3) Now on the left, take a note of the max possible weekly flights - for example, say 28.
4) Take the lease payment that you saw (eg: AS$ 140,000 a week) and divide it by the weekly flights (eg: 28).
5) You now have your approximate new capital cost (140,000/28 - AS$ 5,000 per week)!
6) Add this to the profit and margin figures on the right and you have some new handy data.
Another thing to do is to take the difference in the old and new capital costs (the new one calculated in the above post), divide by the seats available (also shown on the left).
Take your answer away from the 'Cost per Seat' and you will get your new Cost per Seat.
Enjoy!