Breaking economies of scale: commercial and operational viability of all-electric aircraft as regional hub feeder

Abstract

All-electric aircraft with a capacity of 40-50 seats are expected to come into operations before the end of this decade. This paper investigates the operational and commercial challenges in employing all-electric aircraft as feeder for a hub. Based on announcements for electric aircraft projects a probable set of specifications for a future all-electric aircraft with 44 seats will be proposed. Through a bottom-up calculation of the direct cost of operating a feeder flight it will be determined that the model all-electric aircraft has direct cost 10% below an ATR42-500 with the same seating capacity. Assuming more favorable conditions concerning electricity supply and fee structure a further 23% could be saved for the all-electric aircraft. This would undercut the unit cost of an Embraer E190 with 108 seats by 10% breaking the current economies of scale. Consequently, the profit per flight increases, since these seats can be sold at higher yields, addressing the customer segment with the highest willingness-to-pay. This positions an all-electric aircraft as a very attractive option for hub feeding by offering lower seat cost than jets with more than double the capacity. This commercial advantage is gained through the high efficiency of electric engines compared to internal combustion engines overcompensating the disadvantage of high battery weight.