Airline passenger traffic continues to decline

Thursday, 9th July 2009

The decline in business travel due to the recession has meant airlines losing many of their most valuable customers. Although they have tried to compensate for this loss by reducing airfares to lure more leisure travellers, the revenue hasn’t been sufficient to make up for the loss.

As carriers in the US reported results for June, several are showing double-digit declines in key financial indicators.

Hunter Keay, an analyst with Stifel Nicolaus & Co. said: “You are going to see some pretty ugly earnings numbers from the airlines for the second quarter,” adding: “Everybody is in the same boat on demand and pricing. It's tough out there.”

All major US airlines are reporting a drop in June traffic as compared with the same month in 2008. The average decline seen at the top eight carriers was 6.1 percent.

American Airlines and American Eagle reported the largest drop off, at a combined 7.9 percent. United Airlines and the carrier’s regional affiliates saw a combined decline of 7.5 percent.

Airlines measure their traffic in terms of miles flown by paying customers, which does not take into account the amount each passenger pays for their ticket.

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↑ July 2009 news index

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