Abstract
After several years of losses, the U.S. airline industry has returned to profitability. In this report, Mintel traces how it happened and provides insight into the important issues affecting the airline market:
- What actions have airlines taken to improve sales and customer satisfaction?
- What factors, positive or negative, are impacting growth?
- Why are the highest income travelers least satisfied with service?
- Which airlines are performing well? Which are leading in consumer complaints?
- How will air traffic safety be addressed to allow for long-term growth?
- How much do the leading airlines spend on advertising and what are the major advertising themes and programs?
- What is the demographic profile of an air traveler? What influences a traveler' s decision in choosing a flight or airline?
Passenger operating revenues, profits, and passenger growth are provided, as are sales by leading airline.
Mintel defines the airline market as ticket sales of U.S.-based commercial scheduled passenger airlines. Cargo and foreign airlines are not the subject of this report, nor are unscheduled or chartered passenger flights. This report focuses on airlines based in the U.S., but also covers international flights booked on U.S. carriers; it excludes activity by U.S. nationals on foreign carriers.
This report contains US IRI InfoScan data.
Table of Contents
- Scope and Themes
- What you need to know
- Definition
- Resources used for consumer sections
- Abbreviations and terms
- Abbreviations
- Terms
- Executive Summary
- Airline industry still continuing its recovery after 9/11
- Revenue driven by strength of economy; profitability dependent on managing costs and upgrading the ATC system
- U.S. carriers return to profitability; customer service problems rise dramatically
- Southwest outspends all other airlines on media
- Consumers fly, but do not always enjoy it
- Market Drivers and Future Trends
- Fuel cost increases limit profitability
- Figure 1: Airline fuel costs per gallon, at current and constant prices, 2002-07
- Future trend
- Air traffic control system needs overhaul--flight delays and crowded
planes tarnish air travel' s image
- Figure 2: Airline on-time performance, 2002-07 (YTD January-August)
- Figure 3: Reasons for air traffic delays in percent of total delayed minutes, 2003-07
- Planes are full
- Figure 4: Total U.S. passengers emplaned, 2002-07
- Future trend
- GDP growth influences airline revenue
- Figure 5: Total U.S. Real GDP and scheduled airline passenger revenue relationship, 1975-2000
- Figure 6: Total U.S. GDP and scheduled airline passenger revenue relationship, 2002-07*
- Distribution of income
- Figure 7: Per capita disposable personal income, at current and chained 2000 dollars, 2000-06
- Figure 8: Distribution of U.S. households, by income, 1999 and 2004
- A la carte travel on the rise
- Market Size and Forecast
- Market size
- Figure 9: Total operating revenue of U.S. passenger, cargo, charter and other airline, at current and constant prices, 2002-07
- Figure 10: Total operating profit/loss of U.S. passenger, cargo, charter and other airline, at current and constant prices, 2002-07
- Passenger airlines
- Figure 11: Total operating revenue of U.S. passenger airlines, at current and constant prices, 2002-07
- Figure 12: Total U.S. passengers emplaned, 2002-07
- Forecast of U.S. passenger, cargo, charter, and other airline operating
revenue
- Figure 13: Forecast of total operating revenue of U.S. passenger, cargo, charter, and other airlines, at current and constant prices, 2007-12
- U.S. passenger airline operating revenue
- Figure 14: Forecast of operating revenue of U.S. passenger airlines, at current and constant prices, 2007-12
- Forecast factors
- Supply Structure
- Key points
- Operating revenue increased by 19.3% during 2004-06
- All major airlines returned to profitability in first half of 2007
- Leading airlines carried 3.6% more passengers in 2006
- Performance benchmarks
- Companies and brands
- Figure 15: Passenger operating revenue of U.S. airlines, 2004 and 2006
- Figure 16: Operating profit/loss by U.S. carrier, 2004 and 2006 and first-half 2007
- Figure 17: U.S. airlines ranked by number of passengers, 2004 and 2006
- Comparative analysis of major airlines by key performance indicators
- On-time performance by carrier
- Figure 18: U.S. leading airlines, ranked by on-time performance, 12-months ending August 2007
- Mishandled baggage complaints by carrier
- Figure 19: U.S. leading airlines, ranked by mishandled baggage reports filed by passengers, January-June 2006 & 2007
- Consumer complaints by carrier
- Figure 20: U.S. leading airlines, ranked by consumer complaints, January-June 2006 & 2007
- Advertising and Promotion
- Key points
- Introduction
- Figure 21: Television spot, "Saving On Room Service," March 2007
- Figure 22: Television spot, "Sincerely, Billy Doyle," June 2007
- Figure 23: Television spot, "First Glimpse Of Hawaii," March 2007
- Figure 24: Television spot, "Little Bob," May 2007
- Figure 25: Television spot, "Business Travellers/Advantage Awards," March 2007
- Companies and brands
- Figure 26: Media expenditures for leading airlines, 2005-06
- Advertising profiles
- American Airlines
- Figure 27: Television spot, "Business Travellers/Advantage Awards," March 2007
- Figure 28: Television spot, "We know why you fly/little girl talks to dad," March 2007
- AirTran Airways
- Figure 29: Television spot, "Employee thinks boss is on conference call," September 2007
- Continental Airlines
- Figure 30: Television spot, "Flight attendants say goodbye," March 2007
- Delta Airlines
- Figure 31: Television spot, "Deserted airport," May 2007
- Figure 32: Television spot, "More flights and entertainment," May 2007
- Figure 33: Television spot, "Gold Delta SkyMiles credit card," June 2007
- JetBlue
- Figure 34: Television spot, "Sincerely, Mark Adleman," September 2007
- Southwest Airlines
- Figure 35: Television spot, "Man loses neighbours' pets," September 2007
- Figure 36: Television spot, "Woman won' t stop elevator," August 2007
- Figure 37: Television spot, "Airplane spinning wheel," September 2007
- United Airlines
- The Consumer: Travel Profile
- Summary
- Domestic travel is popular
- Most travelers make their own travel arrangements
- Profile of domestic travelers
- Figure 38: Profile of domestic travelers, May 2006--June 2007
- Profile of air travelers
- Figure 39: Profile of domestic air travelers, May 2006--June 2007
- Personal or vacation trips by plane
- Figure 40: Frequency of vacation/personal travel, by gender, May 2006-June 2007
- Figure 41: Frequency of personal/vacation travel, by age, May 2006--June 2007
- Figure 42: Frequency of personal/vacation travel, by household income, May 2006--June 2007
- Business travel by plane
- Figure 43: Frequency of business travel, by gender, May 2006--June 2007
- Figure 44: Frequency of business travel, by age, May 2006--June 2007
- Figure 45: Frequency of business travel, by household income, May 2006--June 2007
- Airlines flown in the past year
- Figure 46: Airlines flown in the past year, by age, October 2007
- Type of traveler
- Figure 47: Type of traveler, by gender, October 2007
- Figure 48: Type of traveler, by age, October 2007
- Flight arrangements
- Figure 49: Who makes flight arrangments, by gender, October 2007
- Figure 50: Who makes flight arrangements, by age, October 2007
- Figure 51: Who makes flight arrangements, by race/ethnicity, October 2007
- Business travel arrangements
- Figure 52: Who makes business flight arrangments, by gender, October 2007
- The Consumer: Foreign Travelers
- Summary
- One in five adults took a foreign trip by plane in the past three years
- Most foreign trips are taken for vacation purposes
- U.S.-based carriers are most popular for foreign travel
- Profile of foreign travelers
- Figure 53: Profile of foreign travelers, May 2006-June 2007
- Profile of foreign air travelers
- Figure 54: Profile of foreign air travelers, May 2006-June 2007
- Reason for foreign trips
- Figure 55: Reason for taking a foreign trip, by gender, May 2006--June 2007
- Figure 56: Reason for taking a foreign trip, by age, May 2006--June 2007
- Figure 57: Reason for taking a foreign trip, by race/ethnicity, May 2006--June 2007
- Number of foreign trips
- Figure 58: Number of foreign trips taken in past 3 years, by gender, May 2006-June 2007
- Figure 59: Number of foreign trips taken in past 3 years, by age, May 2006--June 2007
- Airline preferences for foreign travel
- Figure 60: Airline preferences for foreign travel, by household income, May 2006--June 2007
- Figure 61: Airline preferences for foreign travel, by race/ethnicity, May 2006--June 2007
- The Consumer: Air Travel Experiences and Attitudes
- Summary
- Consumers have mixed feelings about air travel
- Most air travelers are price-sensitive
- Experiences with air travel
- Figure 62: Experiences with air travel, by gender, October 2007
- Figure 63: Experiences with air travel, by household income, October 2007
- Attitudes toward air travel
- Figure 64: Attitudes toward air travel, by gender, October 2007
- Figure 65: Attitudes toward air travel, by age, October 2007
- Figure 66: Attitudes toward air travel, by household income, October 2007
- Fear of flying
- Figure 67: Fear of flying, demographic profile, October 2007
- Willingness to alter air travel plans
- Figure 68: Rescheduling reservations, by age, October 2007
- Figure 69: Rescheduling reservations, by household income, October 2007
- Appendix: Trade Associations
- Appendix: Simmons Cohorts
- Figure 70: Married couples cohorts
- Figure 71: Single women cohorts
- Figure 72: Single men cohorts
