Airlines Pull In Biggest Quarterly Profit In Eight Years
Yes, airline ticket fares have remained relatively flat for the last year.
But the drop in fuel prices, the surge in passenger demand and the rising ancillary fees have combined to offset that and have given U.S. airlines their most profitable quarter since 2007, according to the Department of Transportation.
The combined profit of 26 U.S. passenger airlines was $5.5 billion from April through June of this year, up 53 percent from $3.6 billion in the second quarter of 2014. After years of struggling, the airlines have now recorded nine consecutive quarters of after-tax profit.
The last time a quarter with this kind of profit for airlines was the second quarter of 2007. Note the significance of that time frame. It was a little less than six years after 9/11, when U.S. airlines first started coming out of the financial doldrums following the terrorist attacks, and a year before the recession in 2008 put them back into the red.
Operating revenue was $43.9 billion in the second quarter of 2015, and operating expense was $35.8 billion. The DOT reported that the airlines collected $962 million in baggage fees and $773 million from reservation change fees in the second quarter of 2015.
Fuel costs are down 30 percent over a year ago, while passenger demand is up 10 percent.
Delta Air Lines led the way with $1.5 billion in net income, followed by American at $1.05 billion.
For more Airlines & Airports News
More by Rich Thomaselli
Get Travel Deals and Travel News
Recent Travel Opinions