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After Turbulent Year, Airlines See Smoother 2009

Falling fuel prices and capacity better in line with demand will help profits

By Jim O'Neill,  Newser User

Posted Jan 21, 2009 9:53 AM CST

(Newser) – The nation’s airlines—which scrambled to retask fleets and ground fuel-guzzling aircraft last year as energy prices rose and passenger miles dropped—are likely to have a smoother flight in 2009, reports the Wall Street Journal. Reduced capacity has allowed them to better match supply and demand, and falling oil prices have helped shore up the bottom line.

American and United release earnings today, with others to follow soon. Only Southwest is likely to report a profit for the quarter. Southwest, which has made its reputation on its ability to hedge fuel costs, could be in for a slip after locking in 60% of its 2009 supplies at higher-than-market costs. Industrywide, passenger capacity is near 80%, although overall passenger miles have declined.

An American Airlines plane is the first to take off from the new fourth runway at Dulles International Airport in Chantilly, Va. on Thursday, Nov. 20, 2008.
An American Airlines plane is the first to take off from the new fourth runway at Dulles International Airport in Chantilly, Va. on Thursday, Nov. 20, 2008.   (AP Photo/Jacquelyn Martin)
A Southwest Airlines Boeing 737 departs Chicago's Midway Airport.
A Southwest Airlines Boeing 737 departs Chicago's Midway Airport.   (AP Photo/Charles Rex Arbogast, File)
United Airlines first class passengers check in at San Francisco International Airport in San Francisco.
United Airlines first class passengers check in at San Francisco International Airport in San Francisco.   (AP Photo/Paul Sakuma, file)
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