U.S. Airline Industry Continues to See Increases in Passenger Traffic

Airline passenger traffic on US airlines increased in July despite rising fuel prices and renewed uncertainties about the U.S. economy.

Southwest Airlines recorded an increase of 5.9% in July compared to the same month last year. Southwest also reported a increase in the number of available seats of 6.6%. The month’s RPM increased to 10 billion from 9.5 billion in July 2010.

JetBlue Airways Corporation reported an 11.1% year-over-year traffic increase in July 2011, the highest compared to its rivals. On a year-over-year basis, capacity also climbed 11.6% and load factor fell to 85.9%.

July passenger traffic for American Airlines, a wholly-owned subsidiary of AMR Corporation, increased 1.7% year over year on a capacity growth of 0.9%. American also reported strong international traffic, with an increase of 5%.

United Continental expects 7.5% to 8.5% year-over-year increase in unit revenue for the month of July, measured by passenger revenue per available seat mile (PRASM), a key metric in airlines.

Delta Air Lines, the second largest airline in the U.S., reported that passenger traffic remained stable in year over year comparisons. Domestic traffic dipped 0.9% year over year, while international traffic rose 1.5% year over year on a 3.3% capacity increase.

While escalating fuel prices are a major concern for the air carriers in the short term, crude oil prices have dropped sharply over the last two weeks.