Airlines pocketed USD15.5 billion profit in 2017
Despite seeing overall customer satisfaction drop, airlines had another strong year in 2017, pocketing $15.5 billion in profits.
Combined profit was up 10.7% from $14.4 billion in 2016 based on net income reports to the U.S. Bureau of Transportation Statistics of the 23 largest US carriers.
It was the second most profitable year for the industry as a whole.
Checked baggage fees rose to a record $4.6 billion and reservation change fees brought in $2.9 billion.
Other fees, which are not itemized separately reached $3.3 billion, included food and drink sales and pet transportation fees.
The airlines reported average operating profit margin of 12.2% in 2017, which is down from 15% in 2016.
This is down mostly due to the rising cost of fuel.
Fuel costs are up by nearly 50% compared to a year ago with American Airlines recently warning that airfares may have to rise if fuel costs continue to increase.
The two largest operating costs – fuel and labor – grew by more than $7 billion in 2017.
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Editor for TravelMole North America and Asia pacific regions. Ray is a highly experienced (15+ years) skilled journalist and editor predominantly in travel, hospitality and lifestyle working with a huge number of major market-leading brands. He has also cover in-depth news, interviews and features in general business, finance, tech and geopolitical issues for a select few major news outlets and publishers.
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