AMERICAN AIRLINES and Northwest Airlines set the scene for a record profits performance from the US airline industry as they led the round of year-end reporting.

Northwest, which has helped lead the major US carriers out of recession over the past two years, posted another record year with net profits of $392 million. That came after putting aside $478 million under the employee share-ownership scheme.

The carrier's performance was backed by a steady 2.6% rise in passenger yields and a robust 8% growth in traffic. Load factor also reached 71.5%. Northwest underlined the strength of its alliance with KLM on transatlantic services, despite the recent boardroom row between the partners.

American Airlines posted a more subdued year-end profit of $167 million, but this came after a $533 million charge to pay for the cost of restructuring, including the early-retirement deal struck with the transport-workers and flight-attendants unions. Without the charge, profits would have soared to $501 million.

Behind the improvement was a 4% rise in traffic, with yields and unit costs largely unchanged.

Source: Flight International