The change in oil prices from a year ago to today translates into $24.6 billion in added fuel costs for passengers and cargo airlines on an annualized basis, according to the Air Transport Association. That’s more than the industry has ever earned; the best year for profits at U.S. passenger and cargo airlines was 1999, with net earnings of $5.3 billion.
I absolutely can’t get this out of my head. After first hearing the news that American is going to start charging $15 for the first checked bag, my initial thought was: you have got to be kidding me! Then I came across this stat, one that I had not seen before in those terms, and I was, well, shocked. That $15 fee for my bag suddenly became insignificant as I put this further into perspective. The fact of the matter is, the cost of fuel is killing the airlines, and they’re doing everything they can to generate revenue.