Airlines show was profitable, autumn uncertain

DALLAS – This promises to be a summer to make money for airlines with planes full of passengers paying higher fares than a year ago. But there could be a cold autumn air.

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Tourists say they are cutting back on trips due to higher ticket prices, concerns about the economy and the need to spend more of everything from food to gasoline.

Airlines are planning to cut flights after summer ends. Some are offering sales to fill their planes as the holiday season is over.

"We are concerned about what happens after Labor Day," says Helane Becker, an analyst at Dahlman Rose & Co. "We'll see lower demand and higher discounts."

Economists have cut growth forecasts after a lot of bad economic news recently. Unemployment remains above 9 percent. Retail sales fell for the first time in almost a year. Becker is worried that could presage a decline in leisure travel, offset continued strength in business travel.

People who bought their tickets before the grim headlines helped boost May air traffic over last year's levels, especially on international routes. discount airlines like Southwest and JetBlue took a greater share of U.S. market as tourists and business travelers, even tried to save money.

Nancy Ruby, a customer service manager for a national distributor, which is used to fly United, but was taking Southwest from Dallas to Baltimore this week.

"It's not a corporate policy, but my company has encouraged us to book as early as possible to lower rates," he said. And she has been traveling on Southwest more often to avoid baggage fees and changes in reserves.

Southwest travelers like Ruby helped increase traffic in May from 10.9 percent a year ago. JetBlue traffic increased 10.6 percent, but growth was much slower in the Delta and American and traffic was down slightly at United and Continental.

Higher fares, fuller planes your traffic went up or down, increased rates boosted revenue.

Continental U.S. Holdings Inc. said revenue per seat rose 14 percent to 15 percent from a year ago, and that even includes money from additional fees. The same measure was an increase from 11 to 12 percent at Southwest Airlines Co. and an impressive 19 percent in JetBlue Airways Corp.

The average flight in May was more than 83 percent full, a level of unknown occupation years ago. And it could go higher in June, July and August.

Since 2008, the airlines are well controlled, the number of seats for sale. This is not just made fuller flights is allowed companies to boost prices higher. And they're doing more of the shares – 5.7 billion U.S. dollars last year baggage rates and changes in reserves, the government said this week.

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The airlines need a great summer to offset the cost of aviation fuel, which are about a third more than a year ago. If fuel stays at $ 3 a gallon, the industry bill for 2011 will be $ 54 billion, an increase of $ 15 million over last year, according to a trade group.

Airlines are preparing for the fall season travel slower. This week, JetBlue and AirTran launched sales running on the end of 2011, indicating the need to fill the seats.

Offers low Henry Harteveldt, an analyst with travel industry at Forrester Research, said airlines could cut even more flights than currently planned, making it more difficult to find a cheap price. Travelers say deals are already scarce, and that is causing a rethink their travel plans.

Larry and Carla Brock of Pittsburgh, said he paid $ 840 for a roundtrip ticket on U.S. Airways to Texas, where his son was graduating from surgical residency at a hospital in Dallas. A colleague posed the trip financially bearable.

That price is a kind of ridiculous, "said Carla. "If this (trip) was more than a temporary, would have to think twice about it."

Plus travel expenses to come, warns consumer group

Victor Padilla, an expert in technology for an accounting firm in Dallas, said that instead of his usual weekend trips of three or four to visit friends in New York and Chicago, it will go once or twice this year.

Joan Spurlock, a physical therapist in Fort Worth, Texas, said the flight of his family to summer vacation in Grand Cayman will cost $ 650 each in airfare, around a third more than the same trip two years ago. Spurlock was taking her daughter 14 years old, Jamie, a dance competition in Florida this week, but her husband and another son were staying home because of cost.

"We will travel less often. It is both higher prices and the economy," he said. "I do not mean gas prices – what a scam."

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Submited at Thursday, June 16th, 2011 at 10:00 am on News by john
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