Business

08.28.13

Airlines Are Finally Adding Capacity and Routes

After several quarters of consistent profits, carriers are breaking down and making life slightly better for frequent fliers.

Americans love to complain about flying. And in recent years, they’ve been doing so with good reason. Flights are becoming more expensive and harder to find. And when you pay through the nose for a seat, it’s likely to be one in the middle.

But there’s good news. Flying is about to become a slightly less hellish experience. Just in time for the back-to-school season, airlines are increasing the number of available seats on planes and introducing, or reintroducing, more flight options to travelers.

According to research firm Innovata, airplane capacity is once again on the rise. Between October and December it estimates that U.S. airlines will offer 1.3 percent more flights to travelers. Since the start of this year 321 airplane routes became newly available that weren’t options in 2012. Also 121 flight routes in the U.S. more than doubled the amount of seats available for passengers according to data compiled by Innovata. The largest seat increase was in routes between Los Angeles International Airport and Hartford, Connecticut, whose availability rose more than 9,000 percent.

The expected changes are coming as once struggling U.S. airlines are claiming overall profits for the fourth straight year, and it could mean more choices for travelers who will have more control over their final destinations, flight time, and flying experience. “When the airlines are making money, albeit a very small amount of money, it’s good for consumers, because they are able to add seats to the market, so it gives them more options to go more places at more times of the day,” said John Heimlich, chief economist at Airlines for America (A4A). “To me those are the two most important things for consumers: more service and better service for consumers.”

According to an August report from A4A, 10 U.S. airlines claimed a collective net profit of $1.6 billion just in the first half of this year, up from $1.2 billion in 2012. The increased revenue means that airlines no longer have to cut costs and services to break even and actually have money to spend on their customers once again. The days of free in-flight meals and complimentary checked bags may be behind us, but airline travel isn’t looking as bleak as it once was.

In the first half of 2013 airlines spent approximately $6 billion on reinvestment. Much of that money, including additional funding that will likely be spent through the rest of the year, will go toward increasing flight options and plane capacity. The increases may not sound like much, but they mark an important reversal of a longstanding trend. Previously the number of seats and routes available had dropped significantly. In 2011 the number of seat miles available was 5 percent below the level in 2007. At the beginning of 2013, the number of available flights in the U.S. was down 4 percent from 2012. Cutting down on the number of planes flying to duplicate destinations was a technique airlines used to cut fuel and operations costs. They could just pack more travelers into the same planes and charge higher prices. “Generally speaking, a reduction in capacity limits options for consumers and can result in higher fares,” said Heather Hunter, a spokesperson for AAA, “while increases in capacity increases options and can result in lower fares.”

Higher profits will also lead to a more pleasant experience all around. Some of the reinvestment funding will also go toward plane and airport upgrades. New airplane seats, more Wi-Fi availability in cabins, modernized waiting areas in airports, and revamping airplane meal offerings are just a few of the changes people should expect to see. Airlines also made a push toward making planes more fuel-efficient and ecofriendly, a decision they hope will help reduce expenses as well as potentially lower the price of tickets.

But why spend money on customers now, when it seems that many have gotten used to flying without perks and dealing with horrible departure times? Heimlich says airlines are seeing the upgrades as necessary to stay relevant to travelers, and now that they have money, they are using it. “It’s very competitive,” he said. “If you don’t invest, then people are going to fly on another carrier, or they are going to take their trip through another means.”