UAflyer

Airline Industry: 2009 Recovery?

Q12009 should be interesting indeed, because if businesses fulfill their survey answers and cut substantially on business travel, the impact will be profound. Clearly there will be very little consumer travel for Q42008 not just seasonally, but smarting from Fuel surcharges that are clearly semi-permanent along with checked bags and the menu of fees. Carriers seem to be focused on cutting capacity (re-inventing their business), than wooing customers back on the plane.

Of the earning summaries I have read in the last month, airlines had write-downs for fuel hedges. Possibly pegging Jet fuel prices at $80-90 for many air carriers through the end of 2008. Lets hope many are not still in this situation.

The cost of Oil is a huge factor, but having passengers helps a lot too :)