Some airline companies appear to be faring much better in gaining passenger traffic thanks to a soaring demand for air travel and limited carrier choices -- a trend that has given U.S. airlines wide leeway to maintain overcrowded planes, painfully little legroom, poor in-flight service and shoddy customer service.
WestJet (TSX: WJA), a low-cost Canadian carrier that flew 4.27 million passengers in the second quarter of 2012 -- an increase of 7.7 percent from the year before -- has seen a climb of 6.7 percent over the year before in its revenue passenger miles -- the number of paying passengers multiplied by miles traveled -- in spite of storm clouds that engulfed the skies for several weeks, the company announced Thursday. The airline also expanded its carrying capacity by 2.3 percent over the same period.
Alaska Airlines and Horizon Air, subsidiaries of the Seattle-based Alaska Air Group (NYSE: ALK), which also announced its traffic reports Thursday, fared nearly as well with an increase in both seating capacity and travelers. Alaska Airlines reported a rise of 6.5 percent in passenger traffic, which amounted to 1.64 billion in June -- 100 million more than in the year-earlier period. The company has also improved its passenger-carrying capacity -- or available seat miles -- by 4.6 percent over seven years. Horizon Air performed even better with an 8 percent climb in its passenger traffic. Its carrying capacity rose by 3.9 percent from June 2005.
In contrast, the American carrier U.S. Airways (NYSE: LCC) posted a mediocre performance -- a mere increase of 1.7 percent in mainline revenue passenger miles from the year before. Combining mainline revenues with revenues from passengers traveling on the Express, the revenue per seat mile increased 6 percent from the same period last year, U.S. Airways President Scott Kirby said Thursday. Mainline capacity, or the available seat miles, jumped 2.3 percent.
Torrid heat waves across the Midwest and East Coast may be factors in U.S. Airways' mainline revenue declines, some airline analysts suggest.
Even as passenger traffic scales up, some U.S. airlines, in a frenzied push for higher profitability, are reserving a growing number of window and aisle seats for customers who can afford to pay a princely extra. Customers have been complaining that it is impossible for families to sit together. This new policy is the worst for families that have small children. Rising base fares aren't helping either.
"Who wants to fly like this?" Khampha Bouaphanh, a photographer from Fort Worth, Texas, told the Associated Press in May. "It gets more ridiculous every year."
Bouaphanh scoffed at paying an additional amount of $114 on a roundtrip just so that he could reserve adjacent seats for him, his wife and their 4-year-old daughter on a cross-country flight.
Meanwhile, Canada's West Jet launched a 24-hour, seven-times-a-day weekday flight service between Toronto and New York City's LaGuardia Airport last month. The airline will be introducing an eighth daily weekday flight on July 12. West Jet is also making arrangements to give passengers traveling to New York priority screening in Toronto. There are no extra fees for passengers who wish to reschedule flights.
"A high-frequency schedule to New York, coupled with added conveniences, is an integral part of our strategy to welcome more business travelers on board," said Gregg Saretsky, president and CEO of West Jet.
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