Air Revenue Is Up, But Fuel Costs Hit 30 Percent

Airline passenger revenue rose 13 percent in March 2011, compared to the same month in 2010, marking the 15th consecutive month of revenue growth, according to the Air Transport Association (ATA). The revenue data was based on a sample group of U.S. carriers.

“Higher levels of spending on air travel in March are a solid indicator of expanding economies in the U.S. and abroad,” said ATA Vice President and Chief Economist John Heimlich. “However, the revenue growth experienced in the first quarter has not been sufficient to keep pace with higher jet fuel costs, which have risen more than 30 percent from a year ago. The airline industry remains concerned about a possible slowdown in demand induced by rising energy prices across the economy.”

System-wide passenger traffic, as measured by miles flown by paying passengers, rose 1 percent while the average price to fly one mile, also known as yield, rose 12 percent for the month.

Other key statistics that the ATA reported included the following:

•    U.S. domestic revenue grew 12.5 percent, fueled in large part by an 11.5 percent yield increase.

•    Trans-Atlantic revenue grew 7 percent from a year ago, but represented the smallest increase of the four major regions tracked by ATA, largely due to a softer pricing environment.

•    Trans-Pacific revenue rose by 14 percent despite a 10-percentage point drop in load factor. Routes to and within the Pacific region posted the largest yield increase (16 percent) of any region.

•    A sample of U.S. airlines saw cargo revenue rise 22 percent year over year (up 7 percent domestically and 29 percent internationally) in March 2011.



Read more on: