Other than Delta, the waters are churning for the other biggest players in the U.S. market.
Nowhere is that more evident than at United Continental Holdings, the parent company for United Airlines. United paid a heavy price for the operational issues and integration costs from the United-Continental merger, posting a $723 million loss for 2012. It incurred $739 million in costs for items such as systems integration and training, aircraft repainting and other rebranding activities, and the unified labor agreement reached in August with United and Continental pilots included $454 million for lump-sum cash payments.
United is looking to 2013 to put its troubles behind it.
“We have addressed the operational issues we faced last summer,” CFO John Rainey says. “Given our improved operations and increased customer satisfaction scores, we expect our revenue performance to improve this year.”
The country's largest carrier, however, will not be expanding. Citing concerns about global economic growth, the airline expects a 1.5% decline in its full-year capacity after a first-quarter cut of 4.1-5.1%. “We're committed to capacity discipline and achieving our return-on-invested-capital goal,” Chief Revenue Officer Jim Compton says.
US Airways is coming off a strong financial year, with a $637 million profit, and predicting robust growth and a 3% full-year capacity increase as it takes delivery on fleet replacements that have higher seat counts—namely, 16 Airbus A321s and five A330-200s. US Airways plans to retire 21 aircraft this year: 18 Boeing 737-400s and three Airbus A320s.
Total domestic capacity in 2013 is expected to grow 2.7%, while international capacity could increase as much as 3.6%.
Of course, a merger with American Airlines could alter those plans. American, which lost nearly $2 billion in 2012 largely because of Chapter 11 bankruptcy restructuring costs but achieved an operating profit, is trimming capacity in the first quarter but is not saying what will happen after that.
The country's largest low-cost carrier, Southwest Airlines, also has post-merger integration on its mind after reporting its 40th consecutive profitable year: $421 million in 2012.