An airline industry group expects 222 million passengers to travel between June 1 and August 31, a boon to the U.S.-based carriers, especially due to low fuel cost and current profits from high ticket prices and growth in the fees the companies charge passengers.
According to Airlines for America, an industry group:
A4A projects approximately 222 million passengers (2.4 million per day) are expected to fly on U.S. airlines from June 1 – Aug. 31, up 4.5 percent (104,000 passengers per day) from 2014. This includes 31 million travelers (332,000 per day) on international flights — a record high. To accommodate the expected growth in demand, airlines are increasing the number of available seats by 4.6 percent, or 126,000 per day, during this period.
Popular overseas destinations will include Canada, Mexico, the United Kingdom, Germany and Japan, according to the group that represents America’s 10 largest public company airlines.
Although the price of oil has risen recently, the price of jet fuel is fairly low, historically. Is it any wonder that shares of Delta Air Lines Inc. (NYSE: DAL), American Airlines Group Inc. (NASDAQ: AAL), Southwest Airlines Co. (NYSE: LUV) and JetBlue Airways Corp. (NASDAQ: JBLU) are trading near 52-week highs. This is particularly impressive since the industry is not far removed from a series of Chapter 11 filings, the most recent of which was by American.
Another group that follows the airline industry has estimated what airlines have been able to yield financially from their relatively new fee models:
IdeaWorksCompany, the foremost consultancy on airline ancillary revenues, and CarTrawler, the leading provider of online car rental distribution systems, project airline ancillary revenue will reach $49.9 billion worldwide in 2014. The CarTrawler Worldwide Estimate of Ancillary Revenue represents a massive increase of 121% from the 2010 figure of $22.6 billion.
As far as the industry is concerned, bring on the record passenger levels and bring on higher profits. New charges paid by passengers are not undercutting record air travel.
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