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28 Answers
Vikram Manthri
A picture is worth thousand words.
courtesy:http://www.aviationpartners.com/...
Nathan Chetram

Those are called winglets. To be more specific, that plane (a Boeing 737) uses sharklets, which are a type of winglet that bend up at a pretty extreme angle.

Airplane wings work by creating an area of low pressure above the wing with an area of high pressure below the wing. This “sucks” the wing upward, as well as the aircraft it is attached to. The thing is that the higher pressure air below the wing will curl up and over the wing at the tip in order to try and balance the pressures (fluids of different pressures will always try and balance their pressures). This curling action generates wake vortices, which are vortexes that come off of the tip of the wing.

The problem with this is these vortices create drag, which pulls the plane backwards. That means the engines have to work harder to maintain the plane’s speed, burining more fuel and creating more pollution.

Winglets stop this by “blocking” the flow of high pressure air over the tip, reducing the amount of air that curls over the wing tip. This dramatically reduces the size of these wake vortices, which let’s the plane burn less fuel. It also makes flying safer, as flying into another plane’s vortices can cause a loss of control. By making the vortices smaller, they can dissipate quicker, so they pose less of a risk to other aircraft.

Wingtip fence on an Airbus A320.

“Raked” winglet on a Boeing 787. It doesn’t bend upwards, but it instead tapers off at a greater angle than the rest of the wing, achieving the same results.

Split winglet on Boeing’s new 737MAX.

Vishakh Ranade
In an aircraft wing the lift is produced due to the difference in pressures on the upper and lower side of the wing. The upper side of the wing is subjected to lower pressure and higher velocity air (bernoulli's principle) and the lower side to high pressure. Difference in this pressure leads to a force being exerted on the wing in upward direction called lift force.
The tips of the wings that are permenantly bent are called winglets.
Due to the pressure difference high pressure air from lower side of the air tries going towards the upper side from the ends in an effort to equalise pressure. Such movement of air causes a vortex to form at the wing tip which results in loss of lift and an additional drag component called vortex drag. The presence of the winglet is an effort to reduce this unwanted migration of air from lower to upper side and thus reduce vortex drag.
this type of vortex drag is found in axial compressors. but since there is no way in an axial compressor that a winglet can be fitted, losses are encountered.
Lauri Väin
The answer of the question is money. Winglets give 3-6% fuel savings when cruising, which adds up to good savings for you and me when flying and fuel reserves and the environment as well, considering how many miles are flown each year.

Winglets are just one type of 'wingtip devices' (Wingtip device). Others are wing tip fences (mentioned before), raked wingtips (that have become more popular recently) and hoerner tips to name a few.
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