U.S. legacy carriers have begun to experience a financial turnaround this year despite record-high fuel prices, but they have done so largely on the backs of their customers. (To compare the industry’s 2006 performance with 2005’s, see “How to Save an Airline” and “Another Turbulent Year” at www.cio.com/021506.) “The airline industry is coming back,” says John Kasarda, director of The Frank Hawkins Kenan Institute of Private Enterprise at the University of North Carolina at Chapel Hill. “Their load factors [the ratio of paid passenger seats to total seating capacity] are up considerably due to an increase in passengers and cutbacks in capacity. And that’s enabled them to raise their prices.” Airline fares are back to pre-9/11 levels, rising 10.3 percent in the first quarter of 2006 from the first quarter of 2005, according to the DoT’s Bureau of Transportation Statistics’ “Air Travel Price Index.” It was the biggest year-to-year jump since the DoT launched the index in 1995. The airlines also reported their largest domestic profit margin (7.2 percent) since 2000 in the second quarter of this year, according to the bureau. Analysts expect the U.S. airline industry to return to profitability this year, with the exception of Delta and Northwest Airlines, which are still under bankruptcy protection. But even with this windfall, “the legacy airlines have failed to invest in their product,” says Forrester VP of Travel Research Henry Harteveldt. “Today, you’ll pay $1,000 to fly a [traditional] airline between California and Chicago,” Harteveldt points out. But “the airlines haven’t redecorated their planes or put in new seats since Clinton was in office. They’ve taken away amenities. You have to pay $5 to get a crappy sandwich. Now that passengers aren’t paying those $79 each way fares anymore, their patience will wear out.”And, perhaps, Virgin America will step in. Related content brandpost Sponsored by SAP When natural disasters strike Japan, Ōita University’s EDiSON is ready to act With the technology and assistance of SAP and Zynas Corporation, Ōita University built an emergency-response collaboration tool named EDiSON that helps the Japanese island of Kyushu detect and mitigate natural disasters. By Michael Kure, SAP Contributor Dec 07, 2023 5 mins Digital Transformation brandpost Sponsored by BMC BMC on BMC: How the company enables IT observability with BMC Helix and AIOps The goals: transform an ocean of data and ultimately provide a stellar user experience and maximum value. By Jeff Miller Dec 07, 2023 3 mins IT Leadership brandpost Sponsored by BMC The data deluge: The need for IT Operations observability and strategies for achieving it BMC Helix brings thousands of data points together to create a holistic view of the health of a service. By Jeff Miller Dec 07, 2023 4 mins IT Leadership how-to How to create an effective business continuity plan A business continuity plan outlines procedures and instructions an organization must follow in the face of disaster, whether fire, flood, or cyberattack. Here’s how to create a plan that gives your business the best chance of surviving such an By Mary K. Pratt, Ed Tittel, Kim Lindros Dec 07, 2023 11 mins Small and Medium Business IT Skills Backup and Recovery Podcasts Videos Resources Events SUBSCRIBE TO OUR NEWSLETTER From our editors straight to your inbox Get started by entering your email address below. Please enter a valid email address Subscribe