The combined after-tax net profit at 23 airlines improved from the $14 billion in 2016, according to the Bureau of Transportation Statistics (BTS). But that remained short of the high-water mark of nearly $24.8 billion in 2015, the bureau said.
Fees for checked bags and changing flights contributed nearly 4.6%. The dozen airlines that report fees to the department charged nearly $4.6 billion for bags and $2.9 billion for reservation changes last year, according to the bureau. Bag fees rose nearly 6%, but change fees were down 1.7%, the BTS said.
Another 7.7% of revenue totaling nearly $3.3 billion included other fees such as for food and drink sales or pet transportation that weren’t itemized in the bureau report.
The profits came on a record passenger count of 965 million for 2017.
But there are some dark clouds on the horizon. Fuel cost a combined $26.2 billion, up more than 16% from 2016 and accounting for 17% of expenses last year, according to the bureau.
The price of jet fuel has crept up to $89 per barrel by the last week of April, which was 47% higher than a year earlier, which the International Air Transport Association.
Airlines struggle to adjust prices as quickly as fuel cost changes. But American Airlines CEO Doug Parker warned April 26 that if fuel cost remained high, “I would expect you would see higher fares to consumers over time.”
Fare revenue totaled nearly $130.5 billion last year, a nearly $4.6 billion increase from the year before, according to the bureau. Other than a dip in 2016, the BTS found that fare revenue has climbed fairly steadily during the past five years, rising from nearly $121.4 billion in 2013.