Costs Rise 0.2 Percent Increase in Index

Capacity purchase payments rose 13.3 percent in the third quarter of 2007, according to the Air Transport Association, making it the third largest major airline cost behind fuel and labor. The organization also said that record load factors helped U.S. airlines offset 91 percent cost increase since 2000 but the quarterly Airline Cost Index, now incorporating data through the third quarter of 2007, rose to 191.2 in the third quarter, up 0.2 percent from the third quarter of 2006. This increase is in contrast to a 2.4 percent increase in the Consumer Price Index (CPI). The three largest components of the index -- which includes all operating expenses as well as interest expense -- were fuel (25.9 percent), labor (22.8 percent) and transport-related expenses or capacity purchase payments to regional carriers (13.3 percent). For a complete analysis see the next issue of Regional Aviation News.