American Airlines, Delta Post Steep Losses as Oil Costs Soar

American Airlines parent AMR and Delta Air Lines yesterday reported steep losses in the second quarter of the year, as the surging cost of oil began to push the industry into survival mode.

For passengers, airlines’ declining profitability will mean deeper cuts to service and higher ticket prices in the months ahead as carriers try to shift the new costs to travelers.

American Airlines, the nation’s largest carrier, reported a loss of $1.45 billion. Delta Air Lines posted a $1.04 billion loss. Both companies blamed the losses on record costs for jet fuel. On a conference call yesterday, Gerard Arpey, chairman and chief executive of American Airlines, said the oil price increase has been “nothing short of breathtaking.”

WashingtonPost