US airlines still on the brink
21 / 07 / 2012
US airlines will lose between US$4-9bn in 2008, according to JPMorgan research.
Projecting continuing high oil prices and declining demand Morgan warned: "We don’t believe the industry can move quickly enough to put much of dent in forecasted losses."
A six to seven per cent decline in demand is predicted from a weak US economy.
Collective fuel costs will be $25bn higher than in 2002, says Morgan "overwhelming the $7bn in labour savings wrought by the Chapter 11 cycle."
Among USA’s 10 largest carriers, only Southwest Airlines will be profitable in 2008. Delta Air Lines and Northwest Airlines have already issued warnings that fuel costs would impact the domestic aviation industry negatively this year.