State of the U.S. Airline Industry

Six months after terrorists attacked the United States, the Air Transport Association of America (ATA), the nation’s leading airline trade association, issued a report on the state of the U.S. airline industry. This report, available electronically on the ATA Web site at www.airlines.org, provides a quick overview of the airlines’ economic situation—what they are doing to cope and highlighting areas where costs must be contained. In releasing its findings, ATA indicated that the improving state of the overall economy will help, but more must be done.

ATA President and CEO Carol Hallett emphasized, “All parties involved—airlines, airports, airline employees, government at all levels, and especially the federal government—must focus on getting passengers and products back in the air. There is only one way to do so, and that is by providing a safe, secure, invitingly convenient and affordable travel experience. That is the key to the long-term health of the industry and expansion of our nation’s economy.” Hallett continued, “We know what needs to be done. What lies ahead is meeting and overcoming the challenge.”


According to the ATA report, the airline industry, and the United States at large, are facing an unprecedented challenge. The combined impact of the 2001 economic downturn, and the precipitous decline in air travel following the Sept. 11, 2001 attacks, have resulted in devastating losses for the airline industry. According to the ATA Office of Economics, these losses are likely to exceed $7 billion in 2001—even with the cash compensation provided in the Air Transportation Safety and System Stabilization Act—and will continue through 2002. At best, the airline industry hopes to see a profitable quarter in the later part of 2003. The challenge ahead, articulated by ATA, will be how to sustain this vital industry through a period of catastrophic losses and return it to a point of economic stability that will allow for future growth.


Among the topics covered in the report are the history of U.S. air transport growth, the safety record of U.S. airlines, net income, traffic growth rates, aircraft parked or retired due to the Sept. 11 attacks, aircraft orders and options reduced, load factor trends, labor cost increases, average annual wage statistics, announced furloughs and layoffs, jet fuel price trends, fuel productivity trends, aircraft delays and departures, airline ticket prices and recent price trends, and other pertinent financial trends and data.


An electronic copy of this report in PDF format is available on the ATA Web site at:http://www.airlines.org/public/industry/bin/state.pdf

ADVERTISEMENT


ATA’s Office of Economics also recently published a detailed analysis of airline industry taxes and fees imposed by local, state, federal and foreign authorities. This information may also be obtained by visiting the ATA Web site.


The Air Transport Association of America, Inc. is the trade association for leading U.S. airlines. ATA members transport over 95 percent of all the passenger and cargo traffic in the United States.


——-