American Airlines Chief Financial Officer Devon May told the Financial Times that fares could remain near current levels if fuel prices fall, as the carrier’s third-quarter fuel and related tax expense rose 67.5% year over year.
May also said higher fuel costs would require airlines to raise fares or passenger yield to offset the increase, the Financial Times reported. He said inflation-adjusted ticket prices had yet to recover fully from pandemic-era disruption. May linked delayed fare increases to excess industry capacity in 2024 and said real passenger yields had returned to a level last seen seven years earlier.
American’s filing showed fuel and related taxes totaled $4.635 billion for the three months ended Sept. 30, up $1.868 billion from a year earlier. The average price, including related taxes, rose to $3.85 per gallon from $2.37, while fuel consumption increased 3%. The figures extend EconoTimes’ earlier coverage of the carrier’s fuel expense.
American reported third-quarter revenue of $16.3 billion, up 19.3% year over year. Passenger yield increased 18.3%, and passenger revenue rose 19.5%. Yield compares passenger revenue with revenue passenger miles across the airline’s network; it does not show what an individual traveler paid.
The U.S. Bureau of Labor Statistics (BLS) reported that its airline-fares index was 22.4% higher in September than a year earlier and rose 1.2% from August on a seasonally adjusted basis. The national measure does not represent American-specific fares.
For the fourth quarter, American forecast an average fuel price of about $4.70 per gallon, based on the forward fuel curve as of Oct. 19, and fuel expense about $2.8 billion above the year-earlier period. The company also expects network growth in 2027 to slow from its 2026 pace.
