Our Terms of Service and Privacy Policy have changed.

By continuing to use this site, you are agreeing to the new Privacy Policy and Terms of Service.

Those annoying fees pay off for airlines

By Aaron Smith, CNNMoney.com staff writer


NEW YORK (CNNMoney.com) -- Fees for such things as checked baggage and soft drinks accomplished their purpose, boosting airline revenues for the sixth straight month, an industry group said Wednesday.

The Air Transport Association of America said passenger revenue jumped 25% in June, compared to the same month in 2009.

ATA spokesman David Castelveter said the rise in revenue stems from "a combination of improving economic conditions, increase in business travel and revenue from ancillary fees."

This is welcome news to the airlines, which have struggled with slumping demand because of the recession and volatile fuel prices over the last couple years.

To take the sting out of lost revenue, most airlines have tacked on a slew of extra fees, known as ancillary fees, for checked baggage, drinks, curbside check-in, pet travel and other services that used to be included in the price of fare.

Airline stock activity was mixed Wednesday.

The stock for AirTran (AAI) was down 4% after disappointing results and lower-than-expected profit. But the stock for U.S. Airways (LCC, Fortune 500) rose 3% after reporting earnings that beat estimates.

U.S. Airways Chief Executive Doug Parker said the earnings increase was a result of a three-year plan to "return to profitability, including reducing capacity, maintain cost discipline, increasing ancillary revenues and establishing industry-leading operational reliability." To top of page

Index Last Change % Change
Dow 20,900.02 95.18 0.46%
Nasdaq 6,133.95 50.25 0.83%
S&P 500 2,394.99 13.26 0.56%
Treasuries 2.25 0.01 0.40%
Data as of 3:44pm ET
Company Price Change % Change
Advanced Micro Devic... 10.96 -0.45 -3.91%
Ford Motor Co 11.09 0.22 2.02%
Bank of America Corp... 23.03 -0.02 -0.09%
Cisco Systems Inc 31.85 0.64 2.05%
Chesapeake Energy Co... 5.72 -0.06 -1.04%
Data as of 3:29pm ET
Sponsors

Sections

Why Ford fired its CEO: Shares tumbled amid doubts in about unprecedented changes and new competitors ahead. More

President Trump's budget is likely to make major cuts to safety net programs for the poor, including Medicaid, food stamps and disability payments. More

Millions of newborn piglets are accidentally crushed every year under their mother. SmartGuard is a tech device designed to save piglets' lives. More

A 401(k) plan is the go-to retirement savings account for most workers. But if you're employed at a company that doesn't offer a 401(k) or any other retirement plan, don't worry. There are other options. More