This series provides a performance overview of the top six U.S. airlines for the month of September 2014. The six airlines include Delta Air Lines, Inc. (DAL), American Airlines Group Inc (AAL), United Continental, Inc. (UAL), Southwest Airlines Co (LUV), JetBlue Airways Corporation (JBLU), and Alaska Air Group Inc. (ALK). Together, they account for ~78% of U.S. domestic market share by revenue passenger miles, or RPMs.
By tracking the progress of these airlines, you’ll gain a broad perspective of current trends in the U.S. airline industry. The overview will look at growth trends in traffic, capacity, capacity utilization, unit revenue, and fuel cost for each of the top U.S. airlines in their respective domestic and international markets.
It will also summarize the monthly operational performance of each in terms of on-time arrivals, customer complaints, and baggage mishandling.
Finally, we’ll review the latest valuations to assist you with your investment decisions.
Airline industry September highlights
Overall traffic and capacity increased in September and for the first nine months of the year. In September, the combined RPMs for the top six U.S. airlines increased by 2.6% and capacity, or available seat miles, increased by 2.2%. On a year-to-date basis, traffic also increased by 2.3% and capacity, by 1.7%. Here are the September performance highlights for the top six companies:
- Traffic for all other airlines except American and United increased year over year.
- Capacity growth was negative only for United. Available seat miles for all other airlines increased.
- Load factor improved year over year for all except American and Alaska.
According to the IATA (or International Air Transport Association), worldwide airline shares decreased by 4% in September compared to August primarily due to concerns about the spread of the Ebola virus. Economic weakness in Europe and China also contributed to the dip.