Air Transport World

The 'B' word.(Editorial)

There's a saying in the airline industry that you can't shrink yourself to profitability. Today US airlines are learning that under the right circumstances you can't necessarily grow yourself to profitability either, at least not if the hole is too deep and the price of fuel is too high.

Consider the evidence. Industry revenues rose more than 10% in the first quarter while operating expenses were essentially flat, and yet the 10 US Majors still lost close to $960 million at the operating level and $1.6 billion at the bottom line (see article, p. 62).

The Air Transport Assn. expects that air travel finally will return to pro-9/11 levels this summer, but it holds out little hope for industry profits on the backs of those passengers. …

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