The Thin Route Problem

What Are Thin Routes?

In aviation parlance, a "thin route" is one with insufficient passenger demand to sustain commercially viable air service at market fares. The threshold for "thin" is relative — it depends on the aircraft type being deployed, the cost base of the operating carrier, and the yield environment in the market. A route that is commercially viable for a small regional carrier with low fixed costs may be deeply unprofitable for a full-service mainline carrier with higher labor and overhead costs.

The core problem: airlines face significant fixed costs regardless of how many passengers they carry on any given flight. An ATR 72 turboprop requires a crew, fuel, maintenance, and airport charges whether it carries 10 passengers or 70. The minimum economically viable load factor — the percentage of seats that must be filled to cover costs — determines the minimum viable route: below a certain demand level, no aircraft type can make the numbers work.

Thin routes exist on a spectrum. At one end are routes with some commercial demand but insufficient to support daily scheduled service — perhaps 50–100 passengers per week where daily service would require 200+. In the middle are routes with enough demand for weekly or less-frequent scheduled service but where irregular schedules fail to meet traveler needs. At the far end are communities with perhaps 10–20 travelers per week, where even the smallest commercial aircraft would fly nearly empty.

Geographically, thin routes are concentrated among: small island communities isolated by water; mountain communities where road alternatives are slow or seasonal; remote communities in large countries with sparse populations (northern Canada, outback Australia, Alaska); and developing-world communities where purchasing power is low but aviation is the only practical transport mode.

The Profitability Challenge

Aviation economics on thin routes expose the fundamental mismatch between the cost structure of commercial aviation and the demand characteristics of lightly traveled markets. Consider the unit economics:

A 50-seat regional jet (like the Embraer ERJ-145) operates at roughly $1,500–2,500 per flight hour including all direct operating costs (crew, fuel, maintenance) but before overhead allocation. A 2-hour route segment costs $3,000–5,000 to operate. If 25 passengers pay an average fare of $150, gross revenue is $3,750 — barely covering costs on good days and leaving no margin for overhead, debt service, or profit.

Contrast this with the same route operated by a 9-seat Cessna Grand Caravan turboprop: operating cost around $600–800 per flight hour, so the same 2-hour route costs $1,200–1,600. Nine passengers at $150 generates $1,350 — closer to breakeven, and plausible on a per-departure basis. However, the Caravan's low capacity means that meeting daily demand might require multiple flights per day, with crew and airport charges multiplied accordingly.

The yield required to make thin routes work is often dramatically higher than what the market can bear. A community of 500 people generates perhaps 50 air travelers per week. To be served by a 20-seat aircraft five days a week, the airline needs roughly 10 passengers per flight at a break-even fare that may exceed $300–400 one-way on a 2-hour route — a fare level that suppresses demand further and can make the route economically impossible without subsidy.

Airline industry observers note that the profitability challenge on thin routes is structural, not simply a matter of cost efficiency. Even the most efficient carrier structure — ultra-lean LCC model — cannot close the gap between route economics and market demand on genuinely thin routes without some form of external support.

Aircraft Solutions for Thin Routes

Aircraft technology offers partial solutions to the thin route problem by reducing the fixed cost per departure through smaller, more efficient aircraft:

Turboprop aircraft — the ATR 42/72, De Havilland Canada Dash 8, Beechcraft 1900, and Cessna Caravan family — are the workhorses of thin-route aviation. Their lower purchase prices, simpler maintenance requirements, and ability to operate from shorter, unimproved runways make them feasible where jets cannot operate. Turboprops have lower seat-mile costs on short routes (under 400 kilometers) compared to regional jets because their fuel efficiency advantage at lower speeds and altitudes compensates for their slower cruise speed.

The ATR 72-600, the dominant thin-route turboprop today, seats up to 78 passengers and has a fuel consumption of around 500 liters per hour — dramatically less than regional jets of similar capacity. For carriers serving 400-kilometer routes with moderate demand (40–60 passengers per flight), the ATR is often the financially optimal choice.

Emerging electric and hybrid-electric aircraft hold promise for thin routes in the 2030s and beyond. Companies like Heart Aerospace (ES-30, a 30-seat regional electric aircraft), Eviation (Alice, a 9-seat all-electric commuter plane), and Ampaire are developing aircraft specifically designed for short-range thin-route operations where battery-electric propulsion is technically feasible. Operating costs for electric aircraft are projected to be 40–70% lower per flight hour than equivalent turboprops or regional jets, which could fundamentally change the thin route economics if the aircraft achieve certification and commercial scale.

Hydrogen fuel cell aircraft are another technological pathway that could reduce operating costs on thin routes, though the timeline to commercial certification and the infrastructure requirements of hydrogen fueling add complexity. ZeroAvia's development of hydrogen-electric powertrains for regional aircraft, if successful, could reduce per-seat operating costs significantly on thin routes where daily cycles are short.

Government Subsidies for Thin Routes

The most immediate practical response to the thin route problem is government subsidy. Across the world, various forms of public funding support air services that would not exist under purely commercial conditions:

Direct operating subsidies pay carriers to operate specific routes at predetermined minimum service levels (frequency, capacity, fares). The government essentially acknowledges that the market cannot provide adequate connectivity and pays the gap between commercial viability and the cost of service. This approach is most explicit in programs like the US Essential Air Service.

Route development funds — offered by airports, regional governments, or national development agencies — provide start-up support for new routes without committing to indefinite subsidy. The idea is that a new route may require initial support to build demand awareness and booking patterns but can become self-sustaining once established. European airports have used such funds extensively to attract LCC base operations, with mixed results in terms of long-term service stability.

Infrastructure subsidies — funding airport operating costs, runway maintenance, navigation services — reduce the cost burden on carriers serving thin routes. If an airport in a remote community is kept open by public funds, airlines serving it face lower per-departure landing charges, improving route economics at the margin.

Demand-side subsidies — providing vouchers, reduced fares, or travel grants to passengers on thin routes — stimulate demand directly without paying carriers directly. This approach is used in some Scandinavian countries to support connectivity for inhabitants of remote communities.

Essential Air Service Programs Worldwide

The United States' Essential Air Service (EAS) program is the most extensively studied thin-route subsidy globally. Created by the Airline Deregulation Act of 1978, EAS guaranteed that communities served before deregulation would continue to receive a minimum level of air service for ten years after deregulation, with the subsidy continuing indefinitely through congressional appropriation.

EAS currently subsidizes service at approximately 100 US communities, with total annual expenditure of around $300–350 million. Critics have noted that some subsidies reach extraordinary levels on a per-passenger basis — in extreme cases exceeding $1,000 per passenger — raising questions about cost-effectiveness compared to alternative transport investments. Defenders argue that the loss of air service would cause economic isolation with cascading effects on healthcare access, business viability, and quality of life that far exceed the subsidy cost.

The European Union's Public Service Obligation (PSO) framework, codified in EU Regulation 1008/2008, allows member states to impose public service obligations on routes that are "vital for the economic development" of regions where service would otherwise be absent or inadequate. PSO routes operate under contracts awarded through competitive tender, typically for 3-year periods. Major European PSO networks include French domestic routes to Corsica and French Guiana, Spanish routes to the Canary and Balearic islands, and numerous routes in Ireland, Scotland, Sweden, and Norway.

Norway's FOT routes (Forpliktelse til offentlig tjeneste, or public service obligations) support an extensive domestic network serving coastal and island communities in a country where the fjord geography makes surface transport extremely difficult. Without aviation, communities like Vadsø, Vardø, and Mehamn in the far north would be effectively isolated from the rest of the country. Norway's FOT system is widely regarded as one of the most carefully managed PSO programs globally, with regular performance reviews and efficient tender processes.

Australia's Remote Air Services Subsidy (RASS) program supports aviation in the most remote parts of the continent, particularly Indigenous communities where air transport is the only realistic option for medical evacuations, supply delivery, and community connectivity. RASS involves direct subsidy to operators serving defined remote routes on a regular scheduled basis.

Regional Airline Role on Thin Routes

Regional airlines — carriers operating smaller aircraft (up to approximately 100 seats) under their own brands or as code-share partners of mainline carriers — are the primary commercial operators of thin routes in markets where commercial operation is viable without subsidy.

The regional airline model in the US operates primarily through capacity purchase agreements (CPAs) with mainline partners. Under a CPA, the mainline carrier (Delta, United, American) contracts a regional partner (SkyWest, Republic Airways, Envoy) to operate flights under the mainline brand, using mainline color schemes and flight numbers. The mainline carrier pays the regional a fixed fee per departure and retains all passenger revenue. This arrangement allows mainlines to serve thin markets with lower commercial risk while maintaining brand presence in small communities that feed their hubs.

The regional CPA model has faced challenges in recent years. The COVID-19 pandemic disrupted regional airline finances severely. More structurally, a persistent shortage of pilots — driven by mandatory retirement age rules, military pilot drawdowns, and a generation of pilots retiring after the pandemic — has made regional flying increasingly difficult to staff. Regional airlines, which pay pilots significantly less than mainline carriers, have lost pilots to higher-paying mainline and cargo positions at a rate that has caused service reductions across the regional network.

In Europe, regional airlines like Loganair in Scotland, Wideroe in Norway, and Air Corsica in France serve thin networks often under PSO contracts or in commercial partnership with national carriers. Their specialized knowledge of operating in challenging environments — short runways, poor weather, remote facilities — gives them operational advantages that mainline carriers cannot easily replicate.

Technology Solutions to the Thin Route Problem

Beyond aircraft technology, several technological developments offer solutions to the thin route problem:

Advanced booking systems and demand aggregation platforms can make thin routes more commercially viable by consolidating dispersed demand more efficiently. By matching travelers with identical or overlapping travel needs and offering flexible departure times, these platforms can aggregate demand that might otherwise be individually insufficient to fill a scheduled flight.

On-demand air taxi services, enabled by digital booking platforms and small charter aircraft, offer an alternative to scheduled service on the thinnest routes. Companies like Surf Air (which operates all-you-can-fly subscription models on California routes) and Blade (helicopter and small aircraft services in the US Northeast) demonstrate that technology can create viable thin-route businesses outside the traditional scheduled aviation model.

Urban Air Mobility (UAM) — electric vertical takeoff and landing (eVTOL) aircraft — is often discussed primarily in the context of urban congestion relief, but may also have applications in thin, short-range regional markets. An eVTOL with 4–6 passenger capacity and very low operating costs could serve ultra-thin routes (fewer than 20 passengers per day) at prices competitive with road alternatives if the technology achieves commercial certification and scale.

Remotely piloted aircraft (drones operating in commercial passenger service) remain a longer-term prospect, but the potential to eliminate pilot costs — the single largest variable cost component in regional aviation — from thin-route operations is significant. Several jurisdictions are developing regulatory frameworks for BVLOS (beyond visual line of sight) operations that would be the prerequisite for commercial remotely piloted passenger service.

The Future of Thin Routes

The thin route problem is likely to worsen before it improves, despite technological advances. Several trends are working against thin route viability:

Pilot shortage: The regional pilot shortage in the US and other markets is a multi-year structural issue. Airlines serving thin routes — which are overwhelmingly operated by regional carriers — are disproportionately affected because they cannot compete with mainline pay scales. As long as the pilot pool is constrained, thin routes will face higher labor costs that further compress their economics.

Fuel price volatility: Oil price spikes hit thin-route aviation disproportionately because fuel is a higher percentage of total cost on short-range operations (more fuel burn per seat-mile), and there is no diversification benefit — unlike major carriers that operate across fuel-efficient long-haul routes that offset the short-haul cost burden.

Climate regulation: Emerging carbon pricing and sustainable aviation fuel mandates will increase operating costs across aviation, with thin routes potentially the least able to absorb these cost increases given their already marginal economics.

However, countervailing forces exist. Electric aircraft economics, when they arrive commercially, could fundamentally restructure thin-route profitability. Government commitment to connectivity — particularly in Nordic countries and in post-pandemic recovery plans in many nations — has strengthened political will to maintain PSO and subsidy programs. And the growing recognition of aviation connectivity as essential public infrastructure, not merely a commercial luxury, may generate more robust political support for thin-route subsidies than has historically been present in free-market aviation policy discussions.

The communities most dependent on thin routes — remote, rural, small-population areas with difficult surface transport — are typically also the communities with the least political leverage to secure support for their connectivity needs. Resolving the thin route problem ultimately requires not just technical or economic solutions but a political commitment to connectivity as a right, not merely a market outcome.