Fuel Savings with Weight Loss Drugs in Airline Companies

Weight Loss Drugs Could Provide Significant Savings for Airlines

According to a report by Jefferies analysts, four leading US airlines, including United Airlines Holdings and Delta Air Lines, are expected to spend a total of $38.6 billion on jet fuel this year. Analyst Sheila Kahyaoğlu and her team emphasized that weight loss drugs could reduce one of the industry's largest expenses, with potential savings around $580 million.

Fuel Costs May Decrease with Weight Loss

The report notes that the availability of weight loss drugs in pill form and the decline in obesity rates in society could positively impact the airline industry. For instance, if passengers lose 10% of their weight, it could lead to approximately 1.5% savings in fuel costs, which could in turn increase earnings per share by 4%.

Increase in Obesity Rate and Drug Usage

While it is noted that there has been a decrease in obesity rates in the US over the last three years, the usage of weight loss drugs has doubled. Airlines calculate passenger weight based on standard weight measurements provided by global aviation authorities, which in turn determines fuel consumption.

Warnings About Possible Decline in Snack Sales

Analysts indicate that the savings calculations do not yet take into account the potential decline in snack sales for airlines. Historically, airlines have tried various methods to reduce heavy loads, such as eliminating in-flight magazines or switching to thinner seat designs.

Conclusion

The growing popularity of weight loss drugs like Ozempic and Wegovy may offer airlines a competitive advantage by reducing costs while maintaining service standards.