A recent Deutsche Bank report projects a total airline industry first-quarter pretax profit of $3.5 billion, five times the $700 million pretax profit this time last year.
The bank estimates that nearly 110 percent of the earnings gain will derive from lower fuel prices. It states that “the industry over the past several years has demonstrated its ability to successfully offset most, if not all, of the rise in fuel expense via a combination of cost savings and various revenue initiatives.”
Looking ahead to the end of the year, Deutsche Bank sees airlines generating $24.7 billion in operating income, or the money that remains after certain operating expenses are paid such as research and development, wages, maintenance and the like.
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