The drop in fuel prices has been very good news for consumers, but it has been especially positive for the airline industry. In fact, it looks like 2015 may be the best year the industry has had in decades — perhaps ever.
There’s more at play than just lower fuel prices. Those annoying extra fees, like for checked bags and trip changes, add a lot to the bottom line ($3.5 billion in 2014). More consumers are flying as you’d know if you look around any aircraft you’re on; planes are traveling mostly full (average 85% filled in 2015). And the continuous cutting of small costs, like for snacks and meals, has helped the bottom line as well.
In first three quarters of 2015 airlines reported nearly $17.9 billion in net income after taxes, according the Bureau of Transportation Statistics. Fourth-quarter earnings reports are expected to be very positive. Profits in recent years followed a tumultuous decade for U.S. airlines, with wild fluctuations from terrorism, recession and mergers.
More on this story at USA Today Travel, at this link.
A followup to this story. Delta just announced record profits for the 4th quarter of 2015, this despite lower revenue. Savings said to be mostly related to lower fuel costs.
More on this update at this link.