Of course in last Thursday's USAToday there was an article on SW. First it pointed out that they had raised airfares across the board and then it pointed out that their expected increased fuel cost for this year is greater then last year's profits....
From USAToday
Southwest ups fares for 4th time this year
Updated 7/6/2006 10:36 AM ET E-mail | Save | Print | Subscribe to stories like this
DALLAS (AP) Southwest Airlines (LUV) has raised fares by $3 or $10 for one-way trips one of its largest increases ever and boosted the limit on its refundable fare to $319.
The weekend fare increase was the fourth broad fare increase by the nation's leading low-cost carrier this year and the ninth in the past two years.
The company said it raised one-way fares by $10 on flights longer than 1,000 miles and $3 on flights of 751 miles to 1,000 miles.
Shorter flights were not affected, spokeswoman Paula Berg said.
Berg said the increase, which took effect Friday night, before the July Fourth holiday weekend, was prompted by high fuel prices.
"We earned $548 million last year, and our fuel bill is expected to be $800 million higher this year," she said. "Something has got to be done about it."
Jamie Baker, an analyst at JPMorgan Chase, estimated the fare increases affected 65% of Southwest's revenue.
"Southwest's full-court press for higher fares is a phenomenon we expect to continue for many years" unless there is a "precipitous decline" in fuel prices, Baker said.
He said the higher fares would offer "significant" help to the airline industry.
Baker and Berg said the increase was matched by several other carriers, including American Airlines, United Airlines, Delta Air Lines, Northwest Airlines, Continental Airlines, AirTran Airways and Frontier Airlines.
By boosting some fares $10 each way, Southwest in part matched its highest fare increase ever, a $10 increase in March.
Despite the fare increases, Dallas-based Southwest is packing in customers.
On Wednesday, the company reported its planes averaged 80.4% full in June, up from 76.2% a year earlier.
Southwest reported that June traffic jumped 13.2% from June 2005, to 6.15 billion miles flown by paying customers.
Capacity, calculated by multiplying the number of available seats by miles flown, rose 7.3%. Southwest has been adding capacity while many other U.S. carriers are shrinking because of financial difficulty.
Southwest shares rose 13 cents to close at $16.60 on the New York Stock Exchange. Meanwhile, the Amex Airline index declined 0.6%.