The Networker Lessons #5: CASM

Welcome to the fifth chapter of The Networker lessons. CASM. I’m sure that you have heard this phrase once or twice. What does CASM stand for ? CASM stands for Cost per Available Seat Mile. It is an important measure about an airline’s efficiency. What does it do? Let’s learn.
CASM is the cost to fly one seat for one mile on an airline. It is calculated by diving a flight’s direct operating cost by Available Seat Miles – the latter which is the equivalent of multiplying the number of seats that an airline offers with all of the nautical miles that the airline flies in the same time period.
For example, if an airline flies a 100 seater aircraft on a 150 nautical miles route, the available seat miles (ASM) for this route would be 15,000. If it cost the airline USD3000 to operate the route, the CASM would then be 20 cents.
CASM is often considered as a very accurate tool to compare the performance of two or more airlines – although it should be noted that the CASM may also vary between the nature of flights that an airline operates. An airline which operates a high number of short haul flights might have a slightly higher CASM owing to the higher number on landing and airport charges it may occur. However one could also argue that this is only fair given that it directly compares all the unit costs of the airlines. While a lower CASM may not guarantee that an airline is profitable, it still remains as one of the most important metrics in the airline industry.

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