DOW JONES NEWSWIRES
Operating margins at U.S. airlines improved last quarter for the
first time in 18 months, the U.S. Department of Transportation said
Monday, as network carriers reported the lowest loss margins since
2007.
The department also said the industry collected $669.6 million
in baggage fees in the most recent period, up 18% from the previous
quarter and nearly quadruple the dollar amount a year earlier. As
the recession battered lucrative business-class flying and consumer
travel, airlines have instituted more baggage fees to cope.
The data from the DOT's Bureau of Transportation Statistics come
after improved revenue and profit outlooks by carriers in recent
days. They suggest the worst may be behind the industry after
several quarters of big losses and plunging traffic.
Overall, the average of 21 U.S. carriers had a 1.25% operating
profit margin in the second quarter, while the prior quarter and
last year's figures were in the red.
The group of seven network airlines has reported negative
operating margins for seven consecutive quarters, but the second
quarter's -0.5% was the smallest during that stretch. AMR Corp.'s
(AMR) American Airlines reported the weakest results at -21.8%
while Northwest Airlines had the best at 6.9%. Delta Air Lines Inc.
(DAL), which acquired Northwest last year, was next at 2.9%.
Low-cost airlines posted a 7% operating margin, the best
performance in nearly two years, and regional carriers had a 7.2%
margin, the highest figure since the end of 2006.
-By Joan E. Solsman, Dow Jones Newswires; 212-416-2291;
joan.solsman@dowjones.com