NPR logo

U.S. Airlines See Major Disruption, Some Losses

  • Download
  • <iframe src="" width="100%" height="290" frameborder="0" scrolling="no" title="NPR embedded audio player">
  • Transcript
U.S. Airlines See Major Disruption, Some Losses

Around the Nation

U.S. Airlines See Major Disruption, Some Losses

  • Download
  • <iframe src="" width="100%" height="290" frameborder="0" scrolling="no" title="NPR embedded audio player">
  • Transcript


The financial information on American Airlines is not inconclusive at all. They're still in trouble. Just yesterday, Delta Airlines announced quarterly losses of about $250 million, which actually was not as bad as many people had anticipated.

NPR's Kathy Lohr has more.

KATHY LOHR: The airline business has been tough: The recession dramatically slowed traffic. February blizzards forced U.S. airlines to cancel thousands of flights, and now fallout from the Icelandic volcano stopped all traffic in and out of northern Europe for days. But there is some good news.

Mr. MICHAEL BOYD (President, Boyd Group International): For U.S. carriers, it'll be a relatively short-term hit.

LOHR: Michael Boyd is president of Boyd Group International, an aviation consulting firm.

Mr. BOYD: We think right now they're down about $80 million in terms of lost revenue, and they're down domestically about 80,000 passengers that would have been flying domestically, but aren't, because they can't get here.

LOHR: Delta announced volcano-related disruption grounded about 400 flights as of Monday at a cost of $20 million in lost revenue. But compare that to the recent snowstorms, when the airline canceled 7,000 flights and lost $65 million in revenue.

The disruption has created uncertainly for customers, but analysts say U.S. airlines won't face as many costs as you might think. They're not flying in extra planes to handle the stranded passengers because, airline analyst Robert Mann says, companies simply don't have them.

Mr. ROBERT MANN (Airline Analyst): Airlines run a very lean operation now. So, since there are no spare aircraft or crews, the airlines will attempt to maximize loads on every one of their aircraft that do fly. But it may take days, or in some cases a week or so, to get some of these customers to where they want to go.

LOHR: Airlines are still selling tickets on future flights and will accommodate those whose flights were canceled as best they can. That likely means more waiting and rerouting passengers to other U.S. cities to get them back home.

Mann says the lost revenue will be offset, in part, as carriers do not use costly fuel when planes sit idle on the ground.

Mr. MANN: It's not the equivalent of looking at an ever-rising cost of fuel. We're talking about a four-day event. And that's the extent of it.

LOHR: U.S. airlines will refund some tickets and pay to house dislocated crew members. But analysts say they don't pay much to disrupted passengers when flights are delayed or canceled due to storms, volcanoes or other acts of God. Still, it's going to take some time for all the airlines to get back on track.

Mr. JOHN PINCAVAGE (Airline Industry Analyst): You know, they're all sorts of problems people don't even think about.

LOHR: Airline industry analyst John Pincavage.

Mr. PINCAVAGE: Anytime you disrupt the system, you're going to add extra costs, because, for example, you've totally messed up your entire crew scheduling system. Now you're going to get down toward the end of the month, and even if you have the airplanes available, you may not have the people.

LOHR: Still, the economic impact on U.S. airlines will not be nearly as bad as the effect on European carriers that have been virtually shut down.

U.S. airlines are looking forward to a stronger summer travel season and the hope of profitability in the second quarter. As the cloud of volcanic ash dissipated, the first flights began taking off from Britain's airports last night.

Kathy Lohr, NPR News, Atlanta.

Copyright © 2010 NPR. All rights reserved. Visit our website terms of use and permissions pages at for further information.

NPR transcripts are created on a rush deadline by Verb8tm, Inc., an NPR contractor, and produced using a proprietary transcription process developed with NPR. This text may not be in its final form and may be updated or revised in the future. Accuracy and availability may vary. The authoritative record of NPR’s programming is the audio record.