Airline loyalty programs are losing much of their allure even for frequent flyers, and the rules for navigating the system have changed. Flying is no longer the best way to earn miles or points. The biggest bang for your buck comes from signing up for the right credit card. Frequent-flyer programs get relatively little attention from Wall Street, and their financial importance to the airlines is not widely understood by travellers, who just hope to earn a free flight now and then. Airline profits are subject to vagaries like the price of fuel, the actions of competitors on key routes, even the weather. Amid all that uncertainty, the airlines have found a reliable source of revenue in selling miles to banks, which then use the miles to persuade consumers to sign up for the cards and use them as much as possible. <br/>
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US airlines’ expenses grew at more than twice the rate of revenue in the 2017 first half, leading to a 23.3% year-over-year decline in pre-tax profitability. A4A reported that 9 nine publicly traded mainline US passenger airlines earned a collective pre-tax profit of US$9.2b in the first 6 months of 2017 compared to a pre-tax profit of $12b in the first half of 2016. “The decline in profitability was attributable to expenses surging 9.1%, outpacing 4.2% growth in revenues,” A4A stated. Higher expenses included increases in fuel (plus 19.9% YOY), labour (plus 9.1%), maintenance (plus 8.3%), aircraft (plus 6.8%) and airport rents and landing fees (plus 3.1%). Yield did increase, but just by 1.2% YOY. The nine airlines’ pre-tax profit margin was 11.4% in the first half of 2017 compared to 15.5% in the January-June period in 2016. <br/>
The airline industry is bracing for a huge surge in travel over Labor Day amid low fuel prices, an improving economy and decreasing airfares. A4A estimated Wednesday that 16.1m passengers will fly on US airlines over the 7-day travel period. That’s a 5% increase — or an additional 110,000 passengers per day — from the 15.4m passengers that flew during the same period last year, which capped off a summer of record-high travel. To accommodate the uptick in demand, airlines are adding 133,000 seats per day, according to A4A. The 3 busiest US airports are expected to be Hartsfield–Jackson Atlanta International, Los Angeles International and Chicago O’Hare International. The busiest travel day is expected to be Friday, Sept 1. <br/>
Commanders working with Indian carriers will now have to serve a 1-year notice period before leaving their airline to join another one. Bowing to pressure from big airlines, Indian aviation authorities decided Wednesday to extend the earlier notice period of 6 months for all pilots to a year for captains and commanders. Pilots have been warned that failure to abide by the new rules would invite strict action, including debarring their flying licence permanently or temporarily. Pilots said they would challenge the aviation ministry order legally and termed the situation as one of "bonded labour". Incidentally, about 2 years back the aviation ministry had decided not to interfere in such matters, terming it an employer-employee relation. <br/>