U.S. Airlines Carry Fewer Passengers
U.S. airlines flew fewer passengers last year than at any time since 2004 and are likely to have a slower return to profitability than their peers in Asia and Latin America, according to two reports out Thursday.
The number of domestic and international travelers ferried by U.S. carriers for all of 2009 dropped 5.3 percent from the year before, according to preliminary data released by the U.S. Department of Transportation's Bureau of Transportation Statistics.
But the planes were fuller than ever, largely because airlines cut back on flights or moved to smaller planes. U.S. carriers set a record, with flights that were on average 80.4 percent full systemwide in 2009, according to the report.
Last year was the toughest in modern aviation history, with airlines battered by a recession that kept people from flying and pummeled the carriers' bottom lines.
But increased travel in recent months has brought some relief.
The International Air Transport Association, or IATA, reported that it expects the industry worldwide to lose $2.8 billion this year - half of what it initially forecast.
"It is still a loss, so it is too early for a party," said Giovanni Bisignani, IATA's CEO. "But now, we can clearly see from the numbers that the industry situation is improving."
U.S. airlines, however, are not out of the woods. IATA says that they are likely to continue suffering losses this year, while their peers in Asia and Latin America post modest profits.
"The airlines doing well in today's environment are those in Asia and Latin America, where economic growth has revived the most," the IATA report says. "The weakest markets are clearly across the North Atlantic and within Europe, where the economic recovery has faltered."
To match lower demand for travel, U.S. airlines flew 6.6 percent fewer domestic and international flights than in 2008, the Transportation Department said.
"Naturally, the carriers want to continue to grow their business, and that means fly more passengers," says David Castelveter, spokesman for the Air Transport Association of America. Yet, he says, "They don't want to be . . . in a situation where they're flying near-empty planes."
Even as passengers slowly return to the air, the industry remains concerned about escalating costs for everything from potential new fees to fuel, says Castelveter, whose group represents the country's biggest airlines.
"While we're seeing some turnaround in the number of fliers, we still have great concern about costs," Castelveter says, "and costs are prohibiting that ability to return to profitability."