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Airline losses continue to pile up
The problems at US airlines have intensified with three major carriers reporting an increase in losses.
American Airlines lost $465m before special charges between April and June 2002, compared with a loss of $105m during the corresponding period of last year. Sales dropped by $5.58bn to $4.48bn during the second quarter, below analysts’ forecasts.
The carrier’s chairman and chief executive Don Carty said: “We continue to see a very weak revenue environment. Although traffic has rebounded nicely since last fall, average fares are at 15-year lows, sharply depressing yields.”
Meanwhile, United Airlines’ parent company UAL incurred a second quarter loss of $392m, although this was reduced by a $51m grant aid from the federal government to compensate for losses after September 11. In the same period last year, the airline lost $365m.
Chief executive John Creighton said: “United continues to suffer from the weak revenue environment since September 11. The month-to-month improvements we’ve seen so far this year have stalled.”
US Airways reported a net loss of $248m for the second quarter of 2002 on operating revenues of $1.9bn, compared to a net loss of $24m on operating revenues of $2.5bn for the same period in 2001.
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