US-based carriers say demand is strong despite losses

US-based airlines said this week that demand remains high in spite of posting profit losses for the past quarter.

Travel Insurance News - 26/04/2012

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Both Delta Air Lines and US Airways posted profit losses on Wednesday, citing the increasing cost of jet fuel. However, both airlines – two of the largest in the US market – said that bookings were strong for the upcoming summer travel rush.

After posting a loss this week that was in line with analysts’ forecasts, Delta said that it was expecting to make a profit this quarter in spite of the increasing burden of high fuel prices. US Airways saw a smaller drop-off last quarter and said similarly that passenger demand in the current quarter was strong overall.

Maxim Group analyst Ray Neidl said to Reuters that consumers could expect increased ticket prices in the coming months due to the strong demand for seats. He noted that despite the high cost of fuel that the price was “somewhat stable” and that both US Airways and Delta had done well with slashing non-fuel-related costs.

Delta shares rose to $10.50 on the news early Wednesday, a rise of 0.2 per cent, whilst US Airways stock climbed 3.2 percent to $9.61 in spite of a seesaw early in the day.

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