November 7, 2009
Traffic for the top three US airlines slumped in October, but load factors for most of the nine largest carriers rose and the decline in unit revenue showed signs of slowing down.
Delta Air Lines’ traffic fell 6.5 percent in October versus a year ago. Delta said its load factor rose 1.6 points to 84.2 percent.
American Airlines and United Airlines also reported traffic declines last month.
An FTN Equity Capital Markets analyst said on Friday that unit revenue, a measure of profitability, did not fall as sharply in October as it did the prior month, a sign that operating conditions may be improving.
“October unit revenue improved sequentially from the prior month,” analyst Michael Derchin said in a note. “It now appears that June and September marked the double bottom for the airlines in this important earnings driver.”
US Airways said its consolidated unit revenue sank 10 percent in October, better than the 15-percent decline it logged in September.
For the industry as a whole, mainline unit revenue fell 14 percent in October, better than the 17.4 percent drop in September, according to Derchin.
“The revenue outlook continues to show material signs of improvement with continued strength in both close-in bookings and yields,” US Airways President Scott Kirby said in a statement.
Seven of the nine largest carriers cut capacity in October, typically a strong month for business travel.
(Reuters)
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