Roll Call: Latest News on Capitol Hill, Congress, Politics and Elections
July 25, 2014

2014 Begins Profitably for Airlines; 2013 Another Big Year for Baggage Fees


U.S. passenger airlines’ profits rose in the first quarter of the year — an improvement on last year’s loss in the same period — but fell from the fourth quarter of last year, according to data released Monday by the Department of Transportation’s Bureau of Transportation Statistics.

The airlines reported a net profit of $507 million in the first quarter of 2014, compared to a loss of $392 million in the first quarter of 2013. In the fourth quarter of last year, the airlines made $7.3 billion in net profits.

Airlines collected $28.7 billion from fares, which was nearly three-quarters of their total operating revenue in the first three months of the year.

The data show that operating expenses for the industry in the first-quarter were $36.8 billion, of which fuel costs accounted for $10.2 billion, or 27.7 percent of operating expenses for passenger airlines and labor costs accounted for $9.7 billion, or 26.4 percent.

On the topic of the fees that airlines collect for checked baggage — a subject of discussion at last week’s House Aviation Subcommittee hearing on aviation financing — in the first quarter, passenger airlines got $791 million in baggage fees, which accounted for 2 percent of their total operating revenue, and $726 million from reservation change fees, a bit less than 2 percent of operating revenue.

Baggage fee revenues have grown from $464 million in 2007 to $3.3 billion last year.

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