{"text":[[{"start":9.56,"text":"Airfares will not come down even if oil prices begin to fall, American Airlines has warned, as the world’s largest carrier said it expected to report a loss for the year because of higher fuel costs."}],[{"start":20.32,"text":"“If fuel comes down, I think airfares probably stay largely where they’re at right now,” American’s finance chief Devon May told the FT. “If fuel prices go up, we need to generate higher yield, we need to generate higher fares to offset that higher fuel price.”"}],[{"start":36.64,"text":"Although airlines have raised fares sharply since the Iran war led global jet fuel prices to double, May said ticket prices had not fully recovered in real terms after the Covid-19 pandemic."}],[{"start":48.22,"text":"“This [price increase] ideally should have happened back in 2024, but the industry found itself in an oversupply environment . . . This was the first year that everything came together in a way that we were able to push yields back up to where they were seven years ago in real terms.”"}],[{"start":64.68,"text":"American on Thursday reported a 19 per cent rise in third-quarter revenues compared with the same period last year, powered by a 23 per cent increase in premium travel sales and a 28 per cent boost in corporate-related revenue."}],[{"start":78.16,"text":"But with elevated jet fuel prices imposing an additional $1.9bn cost in the third quarter, the airline cut its profit forecast to a loss of between $1 and $1.60 per share."}],[{"start":90.379,"text":"US rival Delta Air Lines earlier this month also slashed its profit outlook despite a 16 per cent year-on-year rise in third-quarter revenues, while United Airlines reported a fuel-related hit of $1.8bn, 72 per cent of which it has managed to claw back with the help of higher ticket prices."}],[{"start":null,"text":"
"}],[{"start":109.88,"text":"Airline executives have pointed to resilient demand despite higher prices. Delta said it had raised prices about a fifth without any noticeable shift in sales."}],[{"start":119.353,"text":"Leading US carriers have also benefited from booming demand for premium travel as wealthier consumers shrug off the rising cost of tickets. Airlines have raced to offer upgraded cabins, lounges and perks such as superior wines and champagnes."}],[{"start":132.96,"text":"Andrew Nocella, United’s chief commercial officer, on Wednesday told investors “consumers and businesses have been accepting price increases, which we believe is a result of fares lagging the rest of inflation along with other aspects of travel costs for many years”."}],[{"start":148.76,"text":"But he noted occupancy of seats for leisure travel had fallen 1.3 per cent in the third quarter, describing it as “a small amount of elasticity given higher ticket prices, a trade we would make every day”."}],[{"start":161.363,"text":"US airlines have been more exposed to fuel shifts than European and Asian rivals, which were largely hedged against fuel price fluctuations."}],[{"start":169.36,"text":"However, the industry is heading into next year with fewer hedges in place as carriers have been reluctant to take out fresh contracts while jet fuel costs remain high."}],[{"start":179.6,"text":"Some industry chiefs have warned travellers should expect a further rise in ticket prices next year. Ryanair chief executive Michael O’Leary told the FT last month that they could rise up to a fifth next summer."}],[{"start":192.04,"text":"Major carriers including Latam, the region’s largest carrier, and ITA Airways, Italy’s flagship carrier, last week said they expected prices to increase in the coming year."}],[{"start":202.8,"text":"Dan Akins, a US-based aviation economist with Flightpath Economics, said the leading carriers were “getting away with what they can”, citing a lack of competition in the US market and financial pressure on lower-cost airlines."}],[{"start":216.765,"text":"“The four [major US] companies are perfectly happy to continue charging people as long as the demand sticks,” he said."}],[{"start":227.28,"text":""}]],"url":"https://audio.ftcn.net.cn/album/a_1792720472_4827.mp3"}