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Airlines cost increased 91 percent since 2000

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Airlines cost increased 91 percent since 2000

Old 01-29-2008, 05:02 PM
Che Guevara
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Default Airlines cost increased 91 percent since 2000

Airlines' Costs Rose in 3Q
Tuesday January 29, 5:08 pm ET
Airlines' Costs Rose in 3rd Quarter Led by Fuel-Price Jump; Soar 91 Percent Above 2000 Levels

WASHINGTON (AP) -- An airlines' cost index rose slightly in the third quarter of 2007, but overall costs are up 90 percent since 2000, according to an industry trade group.

Fuel costs, at 26.5 percent, accounted for the largest chunk of U.S. airlines' operating expenses in the third quarter, which was up from 25.4 percent in the second quarter, according to the Air Transport Association of America. Labor costs were next at 23.4 percent, which was down slightly from 23.6 percent in the second quarter.

The composite cost index rose to 191.2 in the third quarter, a gain of 0.2 percent from the same period in 2006, the ATA said Monday.

"The slowing economy and sky-high fuel prices are putting tremendous pressure on U.S. airlines to reduce non-fuel costs," ATA Chief Economist John Heimlich said in a release. "Fortunately, in the third quarter, a record load factor of 83 percent helped U.S. airlines offset the 91 percent increase in costs they have seen since 2000."

The average price paid for fuel increased 1.6 percent to $2.11 per gallon in the third quarter, while the average cost of employing a full-time worker rose $709 to $76,423. Airlines also saw maintenance material costs jump 15.3 percent, but that was offset partly by a 16.4 percent drop in aircraft insurance costs and a 17.4 percent decline for other insurance costs.

Both Northwest Airlines Corp. and JetBlue Airways Corp. on Tuesday reported fourth-quarter losses, but the carriers' results were better than expected.
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Old 01-29-2008, 11:33 PM
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Default Labor costs?

I might not be understanding this correctly but, how in the world could labor costs be higher than they were before when the inflight group which Im sure makes up a good portion of the company has taken nothing but pay cuts? Wait..........hmm, might have something to do with those little bonus's management keeps getting. Sneaky sneaky.
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Old 01-30-2008, 01:11 PM
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Costs have increased 91%, but how much have tickets gone up since 2000? Somewhere in the ballpark of not a lot?
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