The indispensable Airline Weekly ran stats this week on airline profitability over the most recent 12 months reported. The results are interesting.
It’s a paid subscription publication, so I won’t reproduce full charts, just a few snippets of the most profitable airlines.
Here are the airlines with the greatest revenue. Note that American and Delta have brought in over $40 billion each in the last year. And by revenue Lufthansa Group (which includes several airlines) is actually bigger than United.
Air France KLM is larger than British Airways (IAG, which also includes Iberia et al) but not nearly worth as much because the former is a money loser while the latter is profitable.
The four most profitable airlines in the world? The four largest U.S. airlines. North America dominates profits, I’m skeptical of Air China’s numbers, and Ryanair and easyJet are striking.
In terms of operating margin, it’s not surprising that low cost carriers do well — Spirit, Allegiant, Ryanair, Frontier. Delta, American, and Southwest are all putting up very strong numbers here. Alaska — despite massive pressure from Delta in their home base of Seattle — continues to put up some of the most impressive numbers in the world.
While US airlines are highly profitable, the clear threat to US and European airlines seems to be coming from these low cost carriers. And yet that’s not where they aim most of their fire.
Indeed the bulk of the world’s airline profits are being made by the big U.S. airlines. Yet Delta, American, and United would have you believe they’re beleaguered underdog’s being unfairly beaten up on by Emirates, Etihad, and Qatar.
Those US airlines claim the Middle East airlines aren’t running real businesses, that’s the crux of their argument (though they faked part of their white paper making that case). Yet Emirates is a highly profitable business.
Emirates Airbus A380 Onboard Bar
Given the strength of US airlines there’s no ‘infant industries’ argument possible here for protectionism. It makes no sense to stick it to consumers by limiting flight choices and limiting fare discounts as Delta is asking the government to do.