A4A Expects Air Travel To Rise To Highest Level In Six Years

March 06--Air travel will rise to its highest level in six years this spring and a record number of passengers will fly internationally on U.S. carriers, a new forecast predicts.

A stronger economy and rising fortunes for individuals have pushed projections to near pre-recession levels, Airlines for America, an industry group that represents U.S. airlines, reported Wednesday. About 130 million passengers, or 2.1 million per day, are expected to fly U.S. airlines during March and April, a 1 percent increase from the same period last year. The forecast includes 17.1 million passengers flying internationally, which would be an industry record.

"We attribute the increase in spring air travel to rising U.S. household net worth, an improving economy and the affordability of air travel," said John Heimlich, vice president and chief economist with Airlines for America.

Another recent forecast by a travel agency group predicted vacationers this year would spend more. The Travel Leaders forecast found that 86 percent of agents nationally said 2014 booking are on par with or greater than a year before, and 94 percent said those clients will spend more in the coming year.

These projections follow a strong year in 2013 for U.S. airlines. Last year, a record 185.4 million travelers flew to and from the United States, an increase of 4.4 from 2012. U.S.-based carriers accounted for more than half of that total. The Houston Airport System also reported a record number of international passengers in and out of Bush Intercontinental Airport last year.

Airlines also had strong operational performance and modest profitability, based on financial statements from nine U.S. airlines that have released full-year 2013 results. Collectively, the airlines reported a net profit of $11.6 billion. Profit margins rose to 7.8 percent. The report says airlines also reduced debt, hired workers and upgrade their aircraft.

"The U.S. airline industry continued its upward climb in 2013, recording a fourth consecutive year of modest profitability, despite incurring more than $50 billion in fuel costs for the third straight year as well as increases in every single nonfuel expense," Heimlich said.

Heimlich said the airlines paid down debt and spent $12.4 billion on such aircraft upgrades as premium seats, in-flight entertainment and WiFi service and on improvements at airport facilities.

The Department of Transportation reported that 99.7 percent of passengers had their bags handled properly, the airlines completed 98.5 percent of their flights and 78.3 percent were on time.

"The airlines achieved an excellent operational year amid severe weather and other events, including air traffic controller furloughs resulting from the federal government's sequestration that snarled air travel for customers last spring," Heimlich said. "These events served as reminders of the industry's vulnerability to events outside of its control."

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