Viva Aerobus is tops for 2018 Top 10 Ancillary Revenue Rankings by IdeaWorksCompany
2018 Top 10 Ancillary Revenue Rankings Introducing you to Nebeneinnahmen
“Nebeneinnahmen” is practically unpronounceable for many of us. But it has become a term of endearment among German airline executives. It’s a German word for “ancillary revenue” and its increased usage demonstrates how it has remade the business models of the Lufthansa Group, the European airline industry, and the world.
Viva Aerobus is tops for ancillary as a percent of revenue
Viva Aerobus jumped Spirit this year with a record 47.6% of revenue. Table 3 below lists the top ten airlines for ancillary revenue as a percentage of total revenue. It’s a stable collection of airlines that generally realize higher percentages year-over-year.
The big change to the 2018 list is the disappearance of WOW air which posted a 28.5% result for 2017. The airline became insolvent in early 2019 and did not share its 2018 results. Eight of the ten airlines achieved higher results when compared to 2017. Joining the top ten list for 2018 is AirAsia which had a dramatic increase from 17.3 percent to 29.0 percent for 2018. This was largely due to an overall 11 percent increase and better disclosure of the group’s results.
Ancillary revenue as a portion of total revenue appears to have reached a ceiling of 50 percent. It’s easier for a non-global airline to achieve this high rate because the underlying passenger fares are lower for short- and medium-haul travel. Every year the ancillary revenue percentage for the bottom entry on the top ten list tends to nudge upward; two years ago it was 22 percent and last year it is 27.6 percent.