Question on contracts

[font=arial, sans-serif][size=2]Hello,

in IL, I charged and how much they charge me for them?[/size][/font]

There is no financial transaction between the parties of an IL contract. The only cost to both of you is hiring Networking employees to make sure connecting bookings can be made, the number of personnel you have to hire is shown on the interlining page after you have recieved/sent an IL offer.

And the amount of employees depends on how many aircraft and flights your partner has (though this one is quite obvious)

While it may appear obvious its important to point out, as it took me a little while to figure it out. Another point to always keep in mind is the cost of the IL contract. Sometimes the cost of the contract will negate the profits you make from that flight. Always worth checking and maybe instead of using the big airline you can try and IL with a mid-sized one. I learnt the hard way!!

Really? I mean the part where IL costs could negate flight costs. I don’t have any ILs at the moment, but from what I remember the sums were not that big.

Also, I am wondering, how do you calculate if IL is unprofitable? You have to keep in mind, that passengers can make 3 switches, so it’s inaccurate to measure IL effect only by the leg which connects your hub to IL hub. Or am I wrong?

Thats true L.J. and something I should think about in the future as my airline has now found solid footing. So thanks for that!:)

At present I personally dont really factor in the swtiches when calculating the costs. I suppose what I was getting at was that if you are a new airline just starting up and open up a route and are not quite getting the LF you need, when searching out an IL contract it may just be better to go for a $900 contract over a $3,800 one.

While some ILs can be very expensive they can also be very rewarding, the trick is to choose wisely. As a small airline you should try to IL with small airlines and make sure you schedule your flights correctly to connect preferably within 3-4hrs. Later on your airline can afford and should start getting into ILs with larger airlines since they will be present at many airports and have multiple airports as hubs with thousands of departures giving you some freedom in scheduling your flights.

On an average calculate(estimate) how many pax on your flights will you bring from and provide to your IL partner, your IL cost by this number is your approx IL cost per pax (also if your IL partner has flights to your hub, it is an additional benefit, that you cannot really calculate), I try to keep it around $10-12/pax but of course I have some ILs that maybe cost me $30-50 and some maybe only $3-5, interestingly most of the expensive ones turn out to be cheaper since they are huge airlines and you can easily have 2-3 daily flights to their hub/s plus almost all of them will be also present at your hub which will greatly improve your network and provide even more benefit.


just as I read this, I thought: ´is it really obvious ?´

Why would the cost of an interlining agreement be measured by the amount of aircrafts and flights and not by the amount of possible connections.

I have a small regional feeder airline in Pago Pago called Sky American Samoa.

The company has exactly two interlining agreements, one with Sky America Pacific and one with Sky America (all three companies belong to the same holding).

Daily departures in Pago Pago

6 Sky America

44 Sky America Pacific

81 Sky American Samoa

Maximum possible connections between

Sky American Samoa and Sky America 7128

Sky American Samoa and Sky America Pacific 972

The exact number will of course be something completely different due to the maximum transfer time of 8 hours

I´ll just guess that it´s aboud one third, but that doesn´t matter anyway, there are definitely more connections between

Sky American Samoa and Sky America Pacific than there are between Sky American Samoa and Sky America.

But the costs of the two Interlining agreements are completely different:

with Sky America 115,275 AS$

with Sky America Pacific 39,934 AS$

This is of course because Sky America is the by far bigger airline than Sky America Pacific, but is it realistic ?

What are those 127 employees that control the IL with Sky America doing all day ?

And will those poor 44 employees that probably really work not hate them ?

I believe that the interling agreement with Sky America Pacific is quite profitable for both companies, but I´m

quite sure that the one with Sky America is not, at least not for Sky American Samoa.

If Sky America is larger than Sky America Pacific, then it does make sense. Allow me to elaborate:

One of your passengers hops on your flight from origin A. He flies to your hub, B, and has a choice to use either Sky America or Sky America Pacific on a flight to either of their hubs, C or D respectively. In hub C, because the airline taken is much larger, there are many more possibilities to connect to than there are in hub D. As such, there are many more possible routes for your passengers to take to their destination, requiring more staff to keep an insight on all possible connections.

Plus, keep in mind, that PAX can book 3 legs. So Airport->Your HUB->IL HUB->Airport, so, I believe, IL staff is responsible for it as well.

Exactly, that’s what I wanted to point out with my post: the reason that you need more IL staff for larger airlines is the greater potential for onward connections.

Oh, yeah.

, skipped that part, since I knew the answer already sorry

lol, no worries, just trying to be clear.

While Tim cleared one point, I’ve got another problem. (lol)

Let’s say SA, SA Pacific and SA Samoa are all interlined with each other - is a trip with 3 legs, each leg operated by SA, SA Pacific, and SA Samoa respectively, possible?


I believe (and, unfortunately, I’m only speculating here), that transfers depend on IL agreements at the starting point. So if you, airline A, have interlining with airlines B and C, but airline B has no IL with C, I believe a PAX, who booked the first leg with your airline would be able to continue the journey with airline B and jumping on to C airlines flight for the last leg of the journey.

I might be wrong, but, as far as I’m aware, 3 leg trips are a bit rare (more common at the beginning of the world or over vast distances), because of the ORS rating, so It’s not that significant. Would be nice though if someone from the team could clarify it.

While that may be true, in this case, SAM’s only flight is to 1 destination, limiting those very onward connections. If the flight is going to HNL (I believe that’d be the route operated by SAM in this case), Pax can only go from airport A to PGG to HNL to airport B or visa versa. Meaning realistically Sky Samoa should only need the interlining personnel for all SAM flights or his IL’d flights at HNL only, not his entire network. It’s different if Sky Samoa’s metal was flying into a major SAM or SAP hub as there’s connections at said airport along with connections at any number of other airports connected by that first hub.


SAM is flying PPG to LAX, ORD and JFK, HNL is a route served ba SAP, so in this case there are actually much mor possible connections between Sky Samoa and SAM then there are between Sky Samoa and SAP.

Not a good example, I´m sorry for that :slight_smile:

But, even though, in this case, like in probably most other cases, the price for interling agreement may be justified, you don´t actually pay for those possible connections, you pay for the number of planes and/or number of flights your interlining partner operates, no matter how good or bad or at all existing your connections are.

But, to be honest, that´s not really a problem, the outcome of it seems to be ok in most cases.