Although airfare is down, airline earnings are still up. Find out what's behind the record-breaking profits.
Cheap oil isn’t only good for drivers’ pocketbooks. The low price of jet fuel pushed airlines to a record-breaking $25.6 billion profit in 2015.
According to Department of Transportation data, that’s a 241 percent increase over 2014’s $7.5 billion profit. Airlines forked over about $27 billion for fuel in 2015, a whopping 38 percent less than its $43.3 billion fuel bill the year prior, CNN Money reports.
Although Americans are paying a little less for airfare these days, they’re paying big bucks for other fees, including baggage charges ($3.8 billion) and flight change fees ($3 billion). According to Skift, the $3.8 billion that Americans paid for bag fees is a new record high. In 2014, fliers ponied up $3.4 billion to check their bags.
While airlines are no doubt reveling in their profits, airline passengers are finding themselves paying a growing amount in fees on everything from picking a window seat to getting a snack, all while crammed into too-small seats on planes.
While airlines’ financial books look robust, passengers grumble about lost bags, deceptive ticket prices, poor customer service and shrinking seats and legroom. Travelers filed 20,170 formal complaints last year, up from 15,539 in 2014, according to the department’s Air Travel Consumer Report.
According to USA Today, airlines have been paying down their debts and investing money into new planes and equipment.
“In short, this industry is working as well as it ever has before – to the benefit of the 2.2 million passengers who fly on U.S. airlines every day,” Melanie Hinton, spokeswoman for industry trade group Airlines for America, said in a statement.
The airlines’ so-called investments have gone relatively unnoticed by fliers.
“Everybody keeps telling us that we’re seeing all these improvements, but nobody’s seeing them,” said Charles Leocha, a founder of the consumer-advocacy group Travelers United. “New airplanes don’t help us when the planes are bigger with more seats on board and they’re squeezing more people into them.
“Check out “Traveler’s Choice: The Worst U.S. Airline of the Year …” for a look at how domestic airlines stacked up on the American Customer Satisfaction Index’s travel report for 2016.
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