Soaring fuel prices saw Delta Air Lines plunge further into the red in the first quarter of the year.
The leading SkyTeam alliance member saw its quarterly net loss deepen year on year by $128 million to $318 million. This was blamed on the $610 million impact of 30% higher fuel prices in the three months to the end of March.
The carrier is already taking a series of measures to combat the increasing price of oil, including domestic fare hikes, international fare surcharges, capacity cuts for the second half of the year, the retirement of 130 of its least efficient aircraft and a $300 million cut in planned capital expenditure to $1.2 billion for 2011.
Total operating revenue for the quarter was up by $899 million or 13% to $7.7 billion over the same period last year. But passenger revenues were hit by $90 million and $35 million respectively by severe winter weather and the earthquake and tsunami disaster in Japan.
Chief executive Richard Anderson said: “Fuel is the biggest challenge facing this industry and Delta is actively reducing capacity, implementing fare actions, hedging our fuel needs and attacking our cost structure in order to offset fuel’s impact on our earnings.”
The airline’s president Ed Bastian added: “Based on the strength we are seeing in the revenue environment, we currently expect double-digit unit revenue growth for the June quarter. We believe our aggressive fare actions, combined with a four point capacity reduction for the back half of the year, will allow us to recover the higher costs of fuel in our ticket prices.”