Breakeven Load Factor (BLF) is the average percent of seats that must be filled on an average flight at current average fares for the airline's passenger revenue to break even with the airline's operating expenses. This study focuses on three groups of major passenger airlines: (1) The "recently bankrupt" - airlines that have filed for bankruptcy within the last two years. This group consists of United Airlines and US Airways. (US Airways has recently emerged from bankruptcy.) (2) The "at risk" - airlines that have not filed for bankruptcy, but they have not achieved yearly profits over the last two years. This group consists of American Airlines, Alaska Airlines, Continental Airlines, Delta Air Lines, America West Airlines, and Northwest Airlines. (3) The "profitable" - the only major passenger airline to show a yearly profit over the last two years is Southwest Airlines. Some other BLF findings include: (1) Since 2000, most large passenger airlines suffered a sharp increase in their BLF. Some carriers could not cover operating expenses even if they sold 100% of their seats at average airfares. (2) Passenger yield, which partly determines BLF, has fallen most sharply for recently bankrupt carriers, although it has also declined steeply for most large carriers. (3) Unit costs - another factor in BLF - have been rising for many large passenger airlines. Large airlines at most financial risk had higher unit costs than other airlines even prior to September 11, 2001, and those costs have remained high and have even increased for some.


  • English

Media Info

  • Pagination: 2 p.
  • Serial:
    • BTS Issue Brief
    • Publisher: Research and Innovative Technology Administration

Subject/Index Terms

Filing Info

  • Accession Number: 00964204
  • Record Type: Publication
  • Report/Paper Numbers: Number 8
  • Files: NTL, TRIS, USDOT
  • Created Date: Oct 24 2003 12:00AM