US airlines to carry record number of international passengers in peak summer season

Washington DC
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US airlines expect a record number of passengers to travel internationally during the peak summer season, following an improved financial performance during the first quarter.

Trade association Airlines for America (A4A) forecasts that 209 million passengers will travel on US airlines from 1 June to 31 August, up about 1% from the same period in 2012.

"This marks the largest summer volume for US airlines since 2008, when more than 210 million travelled," says A4A at an annual forecast today. This year's expected volume, however, still falls below the all-time high of 217 million travellers during the June-August period of 2007 before the recession. Of the 209 million passengers, about 27 million will travel internationally, which marks a new record, says A4A.

The association attributes this year's positive forecast to rising household incomes, corporate profits, strong airline operational performance and relief from lower fuel prices, which has brought down fares.

US carriers are expected to report a load factor of about 86% to 87% during the June-August period, which is in line with previous load factors in the corresponding period in recent years.

US carriers narrowed their first quarter combined net loss in the seasonally challenging first quarter to $552 million, down from $1.7 billion a year ago. The figure provided by A4A draws upon the financial results of 10 US airlines: Alaska Air, Allegiant Air, American Airlines, Delta Air Lines, Hawaiian Airlines, JetBlue Airways, Southwest Airlines, Spirit Airlines, United Airlines and US Airways.

Combined revenues among the 10 carriers were up 2.5% to $34.3 billion in the first quarter.

A4A says it is not able to ascertain the direct impact of the US government budget sequester in April on its members' financial results as yet, says John Heimlich, A4A's vice president and chief economist. Carriers are expected to provide more information in their second quarter financial results, to be released in July.

But the association has estimated that US airlines would have spent about $50 million to deal with the flight disruptions that took place. A4A estimates that 600,000 passengers were affected by the 7,200 flight delays as a result of lower staffing levels among air traffic controllers.

US President Barack Obama passed into law a bill on 1 May to restore FAA staffing levels, putting an end to furloughs among the air traffic controllers and easing flight delays.

A4A says it does not expect a repeat of sequestration-related flight delays come 1 October, when the new government fiscal year begins. Dan Elwell, A4A's senior vice president for safety, security and operations, says the association believes the FAA has realised its furlough plan "wasn't right". "We expect that if sequestration came around again, they won't do it again," he says.