Fuel Price Hikes Eclipse Network Carrier Cost Gain

[USA320Pilot]

Fuel price hikes eclipse network carrier cost gains

NEW YORK (ATWOnline.com) - US airlines are expected to report losses of $1.2 billion for the just-ended third quarter, but the red ink hides some good news for struggling network carriers, according to JP Morgan's Jamie Baker.

Excluding fuel costs, network airline unit costs are at a seven-year low, the analyst stated in a report released yesterday. "We estimate network [airline] ex-fuel CASM fell to 7.88 cents in the third quarter, the lowest third-quarter level since 1997," he wrote. This was achieved in spite of a 4.5% reduction in ASMs.
Had oil prices remained at year-ago third-quarter levels, "the industry would have posted nearly a $200 million profit" for the 2004 quarter instead of the anticipated loss, Baker said in the report.

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USA320Pilot

 

[local 12 proud]

i fear the days of $25.00 a barrel of oil is gone forever, if the airlines don't start passing this cost on to customers we all will be in BK court and the the cost will jusst be passed on to the taxpayer for this historical bailout. unless of course we just all work for free!