U.S. airlines made a net profit of $11.8 billion during
2018, Bureau of Transportation Statistics data shows.
It is the sixth straight year of profit for the industry,
but profits are down 23% from 2017, when U.S. airlines cumulatively reported
net income of $15.3 billion. The 27.3% increase in the amount airlines paid per
gallon of fuel was a major factor in the decline.
Despite higher fuel costs, U.S. airlines realized net profit
of $3.2 billion on international service last year, up from $2.1 billion a year
earlier. However, profit on domestic operations dropped from $13.2 billion in
2017 to $8.6 billion last year.
Most mainline U.S. carriers are public companies and had
already reported 2018 results prior to Monday's BTS release.
However, the release was the first to reveal the two
privately owned mainline U.S. carriers, Frontier and Sun Country, lost money
during the fourth quarter of 2018.
Frontier, the much larger of the two, lost $42 million in
the fourth quarter, its first loss since the first quarter of 2013. Later that
year, current owner Indigo Partners acquired the carrier and transformed it
into an ultralow-cost airline.
The loss came despite a 13% jump in operating revenue.
Frontier didn't immediately respond to an email asking what caused an even
larger jump in operating costs. The labor deal the carrier recently entered
into with its pilots' union didn't take effect until January.
The performance slide, though, was a continuation from the third
quarter, when Frontier saw its operating margin decline to 7% compared with 21%
a year earlier, according to an evaluation of BTS data by industry analyst Seth
Kaplan.
Sun Country, meanwhile, lost $9.4 million during the fourth quarter,
according to a Kaplan analysis. For the year, Sun Country realized net income
of $13 million. Frontier recorded 2018 net income of $82.5 million.