Airlines Reap Sky-High Profits From Fares, Fees

It's been a hot summer for the airlines even though passengers are feeling burned by climbing fares.

Domestic fares have climbed 22 percent (average fare $303) from last year in the most popular travel markets.

"Having gotten rid of all the junk fairs and filling planes full of people who are paying a little more really makes an enormous difference," airline industry consultant Darryl Jenkins told CBS News travel editor Peter Greenberg.

For years, a successful airline in America was defined by which one could lose money longer.

Not this summer

Many carriers, fearful of a potential spike in oil prices, parked hundreds of planes in the desert over the past year. That meant fewer flights and fewer seats.

And with more people flying, fares had now here to go but up.

The result has been soaring profits for eight of the nine major airlines, totaling nearly $2 billion.

Delta had its best earnings in ten years.

One reason for the airlines' success is all those additional charges we've now come to expect on checked bags, including food and pillows.

According to one new study -- carriers took in $13.5 billion from fees in 2009, a 43 percent jump. US Airways has been very aggressive implementing those new fees, telling CBS News it expects to earn more than $500 million this year.

"Those fees have made a big difference in the turnaround," said US Airways CEO Doug Parker. "Without them, the industry would not have been so profitable."

With the pending merger of United and Continental, and more consolidation in the airline industry expected in the months ahead, the cost of air travel may have only one way to go... up.
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