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Where Do U.S. Airline Profits Go? Away From Travelers, Toward Investors

Compared with those ultralux Asian and Middle Eastern airlines, it’s easy to disparage the service levels of the average trip aboard an American, Delta, or United plane. Overhead TVs in the aisle, circa 1980? Yep, the U.S. airline giants still have ‘em. Free meals on a six-hour, cross-country flight or a 10-hour haul to Hawaii? Those aren’t in the budget.

Yet when it comes to airline profits, no one does it like the U.S. carriers. After several Asian carriers reported results in recent days—including Cathay Pacific Airways’ half-year profit of $45 million announced on Wednesday—the financial difference between the U.S. airlines and the foreign carriers that travelers love to fly is striking. Nowadays, Delta clears a $45 million profit in less than a week during the summer.
 
With a mind on Cathay’s results, which marked an enormous increase over the same period last year, Bloomberg Businessweek tallied the results at other highly regarded airlines. Granted, the operating conditions for U.S., Asian, and Middle Eastern airlines differ, but the dramatic disparity in financial results illustrate to some extent differing philosophies. (And, as Delta executives routinely argue, the large Middle Eastern carriers are state-subsidized and don’t compete fairly on costs, an accusation those airlines deny.) All figures below have been converted to U.S. dollars: