There’s probably no company in the entire world that isn’t aiming for extensive digitization at the moment. So do airlines. Many of them focus on the operational process and particularly the fueling process. With this blog post, we answer the most pressing question: What does it an airline cost to operate a digital fueling process.
How Much Does A Digital Fueling Process Cost?
One of the first questions airlines want to know when they start a discussion with us is: How much does a digital fueling process cost? Especially in times of COVID-19, with furloughed resources and frozen budgets, the “cost question” is essential. As always, there is no one answer to that question. Similar to many other digital solutions, the answer depends on several conditions and pre-requisites. However, I will try to answer the question as precisely as possible based on a few assumptions.
Understanding The Digital Fueling Process
To understand the related costs, it is essential to understand the idea of the digital fueling process. A digital fueling process —first and foremost— aims to digitalize the fueling-related communication between airlines and into-plane agents. Accordingly, all messages, such as fuel orders, process milestones, receipts, fuel slips, etc. are exchanged electronically. By doing so, the airline can achieve various benefits from streamlined processes to reduced delays and cost savings.
Check out the following resource in case you want to know more about the benefits:
- Why Your Airline Needs Digital Fuel Management — 4 Success Stories!
- Airline Fuel Efficiency — 10 Benefits Airlines Can Realize Right Now!
What’s Needed To Operate A Digital Fueling Process?
To operate a digital fueling process, an airline needs two things. First, the airline needs one or more systems capable of sending and receiving fuel-related messages (usually according to the IATA AIDX standard). Second, the airline has to connect and use a digital fuel platform. Digital fuel platforms (or networks) are third-party IT solutions that connect airlines and into-plane agents worldwide.
Operating A Digital Fueling Process — What Costs Occur?
Although a digital airline fueling process might look complicated, the costs are relatively easy to calculate — at least when based on certain assumptions.
The costs are marginal or even zero for the first aspect (systems capable of sending/receiving fuel-related messages). Why’s that? Two reasons: First, most airlines operate systems (e. g. LIDO or Sabre) that support the IATA AIDX message standard. Accordingly, the systems also support a digital fueling process. In that case, it requires only smaller configurations. Second, if an airline does not operate an adequate system, they can usually use the fuel network provider’s solutions. These solutions are generally free-of-charge.
Costs For The Digital Fuel Network
For the second aspect, we can provide a very good cost overview. Digital fuel networks are (most-often) cloud-based solutions. Therefore, they offer very flexible and packaged solutions. aFuel, one of the biggest digital fuel networks in the world, offers three different packages.
A basic package that includes:
- Airlines with up to 5,000 flights/month
- iOS and Android apps
- Access to the entire fuel network (+45 airports)
- 9/5 support.
A standard package that includes:
- All basic features
- Airlines with up to 10,000 flights/month
- 98.5 uptime SLA
- Extended support
A premium package that includes:
- All standard features
- Unlimited flights
- 99.8 uptime SLA
- AI functionality
When going for a monthly subscription model, the pricing starts with $2,000 (Basic Package). The Standard Package is $4,000 a month, whereas the Premium Package is $10,000 a month. Switching to an annual subscription, airlines receive one month for free.
In case you want to know more about the pricing model follow this link!
Calculating The ROI
Accordingly, depending on your airline’s size, you can calculate with costs of ~ $20,000 to $100,000. Due to the various benefits of digital fueling processes, airlines directly achieve a positive ROI within the first year. In case you want to dig deeper into ROI calculation feel free to get in touch: Hit me up on Twitter or connect on LinkedIn.