I think the simple answer is that
The end result is that people are more chilled about extracting one more dollar.
Whereas in Europe people are making a lot less money out of GA so there is a lot more “dog eat dog” stuff.
If @Emir is right, then there is a marketplace for one or two EU-wide bulk-fuel procurement setups who then sell to small GA operators at better price while still making a profit.
A friend of mine, ex-airline guy, had such a business. It stopped being profitable over a decade ago and shut down upon his retirement.
Perhaps @EuroGA would be up to managing such a setup? If properly managed it does not have to be very cash-demanding since customers would have to pay deposits before they access credit, a bit like Total cards. I can provide the contacts. Any takers?
Possibly, but wouldny it be hugely admin-intensive as you’d need to negotiate with every airport, or am I wrong and instead you’d enter contracts with BP, Total, WFS etc directly?
Business model:
Issues cards to pilots
Pilots pay deposit (eases cashflow)
On fuelling charge to card from BP etc
BP issues single bill to company with one line per uplift
Company charges back to pilots
Have I got that right? What’s in it for the fuel providers?
Winston wrote:
you’d enter contracts with BP, Total, WFS etc directly
Yes you would enter contracts with fuel a) sellers (ie buy a bulk amount of fuel) and b) suppliers that operate at multiple locations to take the most advantage of the arrangement with minimal administrative burden. One-off “fuel releases” could in theory be pre-arranged at other locations but that is burdensome and to be avoided.
The whole arrangement should be “app-managed” as far as possible to minimize administration costs.
Winston wrote:
What’s in it for the fuel providers?
The bulk sale: securing volume and cash
Antonio wrote:
The bulk sale: securing volume and cash
And why wouldn’t they charge hookup fee and low uplift? If what @Sebastian_G wrote about refuelling truck cost (fuel, people etc.) holds then how suddenly that becomes unimportant if they sell the same quantities to same customers but via another player in the chain?
I don’t think this can work. There is profit in fuel sales and it’s there even when selling small quantities. The issue is that we as customers are not protected against the monopoly and we have to accept any BS that’s thrown on us by refuelers. As long as GA doesn’t have influential representatives like AOPA in US, we’ll be exposed as easy target, either to fleecing or to green/environmentalist actions for gaining cheap political points. Again a rhetorical (off topic) question: can you imagine an vandalising action like this in US?
Emir wrote:
And why wouldn’t they charge hookup fee and low uplift? If what @Sebastian_G wrote about refuelling truck cost (fuel, people etc.) holds then how suddenly that becomes unimportant if they sell the same quantities to same customers but via another player in the chain?
I am not saying they would not charge it. I am saying you could negotiate a bulk “into-plane fee” (inclusive of hook-up, low-uplift, whatever you/they want to call it) for your group of associate-customers. The “fuel” is the simple part, since one single seller can sell you fuel at mutliple locations via its own inter-brand agreements. The “into plane” as you say, is more complex due to hundreds of suppliers at multiple airports. The idea is to start with suppliers at large volume airports and those who have into-plane agreements or own services at multiple places like Exolum at multiple places in Spain, and of course, combined fuel+into-plane deals for the likes of BP and Total.
You would never be able to cover the whole network, but progressively you should be able to cover at least 50% of the GA-accessible locations. It is less labour-intensive than you would be lead to believe since once you have a standard contract it is relatively easy to adapt it to multiple suppliers/locations.
Ryanair has a fleet of some 500 aircraft and flies to about 250 relatively high-frequency destinations.
Due to its nature, my main customer airline Volotea flies low-frequency routes (sometimes once per week) to over 100 destinations with a fleet of 41 aircraft.
Guess which of the two has to comparatively broker more airport, handling and, of course, into-plane fuelling deals
GA is taking the latter model to the extreme, but what I am saying is that it is a feasible model, if you are willing to make the effort.
Volotea is managing that with a relatively small procurement organization that my consultancy is integrated in, with the added “burden” of the required quality system.
With just the active flyers in this forum, if (but only if) the pricing scheme is as @Emir describes it, then PROB90 there is enough volume to justify such an organization minus the non-mandatory-for-NCO quality system and make a profit.
