A second financial issue is that of hedging oil and fuel purchases, which are usually second only to labor in its relative cost to the company. However, with the current high fuel prices it has become the largest cost to an airline. Legacy airlines, compared with new entrants, have been hit harder by rising fuel prices partly due to the running of older, less fuel efficient aircraft. While hedging instruments can be expensive, they can easily pay for themselves many times over in periods of increasing fuel costs, such as in the 2000–2005 period.
Among the first countries to have regular airlines in Latin America and the Caribbean were Bolivia with Lloyd Aéreo Boliviano, Cuba with Cubana de Aviación, Colombia with Avianca (the first airline established in the Americas), Argentina with Aerolineas Argentinas, Chile with LAN Chile (today LATAM Airlines), Brazil with Varig, Dominican Republic with Dominicana de Aviación, Mexico with Mexicana de Aviación, Trinidad and Tobago with BWIA West Indies Airways (today Caribbean Airlines), Venezuela with Aeropostal, Puerto Rico with Puertorriquena; and TACA based in El Salvador and representing several airlines of Central America (Costa Rica, Guatemala, Honduras and Nicaragua). All the previous airlines started regular operations well before World War II. Puerto Rican commercial airlines such as Prinair, Oceanair, Fina Air and Vieques Air Link came much after the second world war, as did several others from other countries like Mexico's Interjet and Volaris, Venezuela's Aserca Airlines and others.
Possibly the location of the storied island of Atlantis, Santorini is the stuff of screensavers and wall calendars. Red-, black- and white-sand beaches rim its caldera lake — one of the largest in the world — while iconic whitewashed buildings stair-step up the hillside overlooking the Aegean Sea. Photo ops abound, from centuries-old windmills and ancient ruins to blue-domed churches and colorful wooden fishing boats. Stay in a boutique cave hotel for the full experience.
During the era of decolonization, newly born Asian countries started to embrace air transport. Among the first Asian carriers during the era were Cathay Pacific of Hong Kong (founded in September 1946), Orient Airways (later Pakistan International Airlines; founded in October 1946), Air Ceylon (later SriLankan Airlines; founded in 1947), Malayan Airways Limited in 1947 (later Singapore and Malaysia Airlines), El Al in Israel in 1948, Garuda Indonesia in 1949, Japan Airlines in 1951, Thai Airways International in 1960, and Korean National Airlines in 1947.
One argument is that positive externalities, such as higher growth due to global mobility, outweigh the microeconomic losses and justify continuing government intervention. A historically high level of government intervention in the airline industry can be seen as part of a wider political consensus on strategic forms of transport, such as highways and railways, both of which receive public funding in most parts of the world. Although many countries continue to operate state-owned or parastatal airlines, many large airlines today are privately owned and are therefore governed by microeconomic principles to maximize shareholder profit.
By the end of the 1930s Aeroflot had become the world's largest airline, employing more than 4,000 pilots and 60,000 other service personnel and operating around 3,000 aircraft (of which 75% were considered obsolete by its own standards). During the Soviet era Aeroflot was synonymous with Russian civil aviation, as it was the only air carrier. It became the first airline in the world to operate sustained regular jet services on 15 September 1956 with the Tupolev Tu-104.
Airlines have substantial fixed and operating costs to establish and maintain air services: labor, fuel, airplanes, engines, spares and parts, IT services and networks, airport equipment, airport handling services, booking commissions, advertising, catering, training, aviation insurance and other costs. Thus all but a small percentage of the income from ticket sales is paid out to a wide variety of external providers or internal cost centers.