A New Approach to Airline Economics The Vehicle Millemile (VMM)

Extract

A Vehicle Millemile is a 1000-mile unit of flight production. A big jet may cost in total £1500 to fly 1000 statute miles or 1 VMM.

If 6 tons of passengers (or 60 passengers and their free baggage) earn £200/Paxton Ton-Millemile x 6=£1200, and the revenue from 3 tons of cargo is £100/Load Ton-Millemile x 3=£300, it is simple economics to see that this “mix” will provide breakeven with 9 tons load on board and a total revenue mix of £1200 + £300=£1500/VMM or per 1000 miles. A big jet flying 1600 VMMs per annum at £1500/VMM costs £2.4m and the above passenger and cargo ton factors would provide sufficient revenue to break even.

In a few seconds, therefore, we have ascertained the composite “mix” of load and revenue needed to meet the cost of flying the aircraft 1000 miles, and the answers are far more enlightening than saying that an average 60 passengers are carried at 4.8 d/PM and 2721 kg of cargo are carried at 24 d/LTM.

The fact that many medium size or small airlines have route stagelengths of less than one Vehicle Millemile at 500 miles or 200 miles makes no difference to the validity of ease of application of VMM Economics, but its great value Jies in the study of intercontinental big jet operations, SST analysis, sub-orbital flight and even interplanetary flight costing.