You’re welcome, taxpayers

UBS Warburg sees several airlines doing well financially on the backs of their federal welfare payments. Turns out this ’emergency aid’ came at a time when business was picking up anyway.

    “As carriers cash their welfare . . . er, security refund checks, it’s safe to do a little Monday morning quarterbacking on the economics of the more recent federal airline bailout,” Buttrick said.

    “Essentially, a $2 billion war investment netted the industry $2.5 billion. As wars go, this was a good one for airline economics. Now if airlines could only run their core business as well,” Buttrick said.

    Atlanta-based Delta Air Lines got the biggest security reimbursement, $390 million, and has received about $1 billion from the two aid packages combined.

    Buttrick is cutting his 2003 loss estimate for the industry to $7 billion from $7.8 billion, citing the federal aid, mildly improving revenue trends for the late spring and summer, and cost cutting labor deals at various companies.

    “Each of the four primary profit drivers — capacity, oil, labor and demand — is getting better . . . but it’s far from good,” Buttrick said.

About Gary Leff

Gary Leff is one of the foremost experts in the field of miles, points, and frequent business travel - a topic he has covered since 2002. Co-founder of frequent flyer community, emcee of the Freddie Awards, and named one of the "World's Top Travel Experts" by Conde' Nast Traveler (2010-Present) Gary has been a guest on most major news media, profiled in several top print publications, and published broadly on the topic of consumer loyalty. More About Gary »

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