February was not a great month for the airlines. As oil prices spiked, capacity growth plans were cut while airlines raced to increase fares. As a result, the number of seats filled dropped. It's going to take some time for the industry to adjust.
One of the more surprising changes was for little Allegiant Air (ALGT). Allegiant has been on a turbocharged growth trajectory for some time, but in February, Allegiant actually saw the number of seats shrink year-over-year. I had to do a double take to make sure I wasn't reading it wrong. At least for Allegiant, this seems like a good thing. While January revenues per seat were up single digits, February numbers were up double digits with more seats filled. That's not a bad combo.
But many airlines were unable to match their previous lofty loads. All of the legacy carriers saw the percentage of seats filled drop. None fell more than Delta (DAL) with a 3.4 percentage point drop. Most of that drop came from international operations where Delta's capacity zoomed ahead 12.5 percent. Across the Atlantic, that meant a whopping 7.3 point drop in loads. This is the second month in a row that Delta has turned in disappointing numbers.
As fares keep rising, it will become even more important to keep capacity in check. We'll see if the airlines can do that in the next couple months.
Here are the February traffic numbers from 2010 vs 2009. Available Seat Miles (ASMs) are a measure of total potential passenger capacity while Revenue Passenger Miles (RPMs) are a measure of actual passenger capacity. Load factor is RPMs/ASMs.
|US Airways#||5.3%||4.1%||-0.8 pts|
#Only includes wholly-owned regional subsidiaries
- Delta Sees Empty Seats in January, but That May Not be Bad
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- Airlines Temper Their Urges to Grow in November