Younger Fleets Boost Non-U.S. Airlines

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"Given the state of the U.S. airline industry, who is going to pay for these aircraft?" asks Chris Tarry, an independent British aviation analyst based in Tunbridge Wells, England. "The manufacturers won't want to provide financing."

How much fuel do those old planes guzzle? Airlines and aircraft makers rarely disclose figures, and comparing aircraft models is difficult because of variables such as flying time and cabin configuration. However, fuel-cost data reported by U.S. carriers to the Transportation Dept. gives a rough idea of the situation.

According to DOT figures, the Boeing 767 model used by many U.S. carriers on transatlantic routes uses an average $3,946 worth of fuel and oil per hour during a 3,000-mile flight—or $17.85 per passenger per hour, based on an average 221 seats. The Airbus A330 model used by Air France and other European carriers burns an average $15.72 per passenger per hour, about 12% less, under comparable conditions.

Domestic Routes May Be Threatened Next

Higher fuel costs aren't the only disadvantage to operating aging fleets: Older planes also require heavier maintenance. Big jets have to undergo a major checkup every six to eight years that costs an average $1.5 million and keeps the plane grounded for up to a month, says Adam Pilarski, senior vice-president of the Avitas aviation consulting firm in Chantilly, Va. To avoid that, some foreign airlines such as Emirates replace their planes after five or six years.

Of course, U.S. airlines aren't threatened by competition from foreign carriers' younger planes on domestic routes, since the foreigners aren't allowed to operate flights that begin and end in the country. But as the U.S. industry's finances worsen, Washington could face pressure to ease longstanding restrictions against foreign ownership of U.S. airlines, allowing cash-rich players such as Air France and Lufthansa (LHAG.DE) to make a move.

Lufthansa already owns 19% of discount carrier JetBlue (JBLU). And London's Virgin Atlantic, whose seven-year-old fleet (on average) is one of the youngest in the business, recently launched a U.S. low-cost carrier, Virgin America, in which it holds a minority stake. In this business, staying young pays big dividends.

See the BusinessWeek.com slide show for a look at how airlines are coping with high fuel costs.

Editor's note: This updated version of the story contains a revised estimate for the average age of Northwest's airline fleet.

Matlack is BusinessWeek's Paris bureau chief.