In U.S. airline news last week, three of the nation’s largest carriers turned in solid profits for the third quarter; American takes on a new code-share partner in the Pacific; Delta outranks other airlines in revenues from checked bag fees; Virgin America changes weight limit for checked bags; and Frontier’s parent is said to be looking for new ways to raise cash.
• While American Airlines continues to bleed red ink despite the ongoing recovery, its major competitors were solidly in the black for the third quarter, although in some cases their results slipped from last year’s. Delta turned in net income for the quarter of $549 million, up from $366 million a year earlier. Delta’s traffic fell slightly, but higher fares gave it an 11 percent increase in revenue per passenger. United Continental reported a third quarter profit of $773 million, down 14 percent from a year ago; and US Airways said its net income fell by 68 percent year-over-year to $76 million. Both companies cited much higher jet fuel costs – 33 percent higher at United Continental and 45 percent at US Airways.
• The newest code-sharing partner for American Airlines is Air Pacific, based in Fiji. American said that after government approvals are obtained – expected in 30 to 60 days -- it will put its AA code on Air Pacific’s Los Angeles-Nadi, Honolulu-Nadi and Nadi-Suva flights, while Air Pacific’s code will go onto 20 American routes out of Los Angeles.
• According to fresh statistics from the U.S. Bureau of Transportation Statistics, U.S. airlines hauled in nearly $1.7 billion from checked baggage fees in the first six months of the year. Delta posted the greatest bag revenues at $424 million, followed by American ($293 million), US Airways $256 million), Continental ($168 million) and United ($137 million).
• Effective this week, Virgin America Airlines has a new policy for overweight checked bags. The previous maximum weight of 70 pounds has been lowered to 50 pounds. A first checked bag that weighs more than 51 pounds but less than 70 incurs a $50 overweight fee, and one that’s more than 71 pounds but less than 100 will cost $100 extra. That’s in addition to the standard checked bag fee.
• Bloomberg News said it obtained an internal memo from Republic Airways Holdings CEO Bryan Bedford to employees in which Bedford said the company may sell assets to boost its cash reserves. Republic is the parent of Frontier Airlines as well as regional carriers. The memo reportedly said the company is close to finishing a $120 million restructuring for Frontier, a move that could include the sale of takeoff and landing slots at Washington Reagan National Airport as well as 10 Embraer E190 regional jets. It also reportedly said Frontier’s A318s and A319s might be altered by removing one of the three lavatories on each plane and adding a few more seats.