ATP Grads at Airlines

Low-cost Carrier's Profits Soar

Published Jun 30, 2010 on Pilot Jobs

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Once again, low-cost and regional air carriers in the U.S. were more profitable than legacy carriers, according to data released Monday by the U.S. Department of Transportation.


For the first quarter, low-cost carriers - including Miramar-based Spirit Airlines - reported a 2.4 percent operating profit margin, or $115 million. The top legacy network carriers, on the other hand, posted a margin loss of 0.7 percent, or $163 million. Regional carriers posted an operating profit of 3.9 percent, or $60 million.

With $24 million in operating profit reported, Spirit, the leading carrier at Fort Lauderdale-Hollywood International Airport, posted the second-highest margin in the low-cost group, at 13.1 percent. Only Allegiant Air posted a higher margin, at 20 percent.

In the first quarter of 2009, however, Spirit posted a higher operating profit, $28.8 million, and margin, 17.1 percent. Spirit’s operating revenue grew to $184 million from $169.8 million.

Spirit once again led the industry with the highest percentage of ancillary revenue of any airline. With 21.7 percent of overall revenue derived from baggage fees, reservation changes, etc., Spirit had more than double the ancillary revenue of AirTran, which had the second-highest percentage, at 10.3 percent.

Starting Aug. 1, the airline plans to start charging passengers up to $45 for carry-on luggage.

On June 16, Spirit settled a five-day pilots strike that started over salary and benefits. The company resumed a full schedule on June 18, and pilots are expected to ratify the tentative agreement in July.

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