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Fewer Flights, More Revenue: Airlines Come Out Ahead

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simple_planeRecently, the Department of Transportation (DOT) reported on the best airlines in the US depending on the number of complaints per airline, on-time departures, and baggage handling.

This Monday, the DOT’s Research and Innovate Technology Administration (RITA) released the Bureau of Transportation Statistics for US airlines. The financial data reveals how much money airlines make each year, how many flights are taking off, and how many passengers are on them.

So how much are airlines making? As it turns out, the overall net income has varied significantly over the past 8 years; the net income of airlines has increased 153.5 percent.

This is due to several different factors. In 2005, the net income of airlines was negative $19.7 billion. Since then, airlines have cut back on expenses by reducing the number of seats available by consolidating and reducing routes.

The number of flights has decreased by about 17 percent since 2005. Meanwhile, the amount of passengers has remained relatively the same, decreasing by 1.77 percent since the same year.

Take a closer look at how many flights have been running each year, the number of passengers traveling, the overall operating revenue for airlines, and the net income. Keep in mind that the net income is what an airline has after covering expenses. Dollar amounts are in the thousands.

Year

Flights

Number of Passengers

Operating Revenue

Net Income

2005

10,033,140

657,261,487

111,858,063

-19,747,536

2006

9,707,992

658,362,617

120,906,925

9,043,659

2007

9,835,722

679,168,758

124,502,978

2,995,875

2008

9,375,634

651,709,940

129,728,330

-18,173,970

2009

8,766,435

618,052,278

109,681,017

-2,252,074

2010

8,699,893

629,537,424

119,073,502

1,176,134

2011

8,647,261

638,247,232

132,822,096

1,440,558

2012

8,444,837

642,288,387

135,830,297

2,183,532

2013

8,314,486

645,614,813

139,198,783

10,574,605

In 2013, airlines collected $120.6 billion from fares, which represents 60.4 percent of total annual operating revenue.

In addition to tickets, passengers are paying for baggage fees as well as reservation cancellation and flight change fees. Baggage fees represent 1.7 percent of the total operating revenue, and brought in $3.3 billion last year.

Revenue from baggage fees has increased by 621.6 percent since 2007. The revenue airlines earn from reservation cancellation and change fees has increased from the same year by 207.5 percent.

Here’s a closer look at the numbers. Dollar amounts are in the thousands.

Year

Reservation Cancellation/Change Fees

Baggage Fees

2007

915,231

464,284

2008

1,668,748

1,149,408

2009

2,373,019

2,728,850

2010

2,297,377

3,395,471

2011

2,380,157

3,360,638

2012

2,554,658

3,486,936

2013

2,814,069

3,350,072

Want to know more about the best airlines and hidden fees? Check out:

By Stephanie Ervin for PeterGreenberg.com 

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