Happy Saturday!
This is going to be the first of many of these weekend recaps, The Altitude Weekend, I’m going to do on this site moving forward. These recaps will encompass news and developments that the airline industry saw during the week, specifically related to the business of the industry. I’ll summarize the week by including snippets from my published articles and links from around the web that I think are worth a read.
This week, we saw airlines across the U.S. raise checked bag fees in an attempt to offset rising jet fuel costs with continued unrest in the Middle East. Delta Air Lines reported its first-quarter results on Wednesday, and Chief Executive Officer Ed Bastian had some interesting comments regarding fuel, airfares, and potential mergers. Transportation Secretary Sean Duffy similarly shared some thoughts on airline mergers on behalf of the Trump Administration.
U.S. Carriers Raise Checked Bag Fees
JetBlue was the first airline to raise checked bag fees on April 1. The carrier increased prices by $4 to $9, depending on the number of bags passengers had to check. United followed next later in the week.
This week, Delta, American, Southwest, and Alaska Airlines all increased bag fees, mirroring moves by others.
Delta, for example, is now charging $45 for the first checked bag, $55 for a second, and $200 for a third. American went further and will charge passengers ticketed in Basic Economy an additional $5 on top of the higher bag fees.
Across the board, passengers with elite status or a co-branded credit card will continue to receive checked bag benefits.
Airlines have cited higher jet fuel prices as reasons for increasing fees.
Links:
Delta Reports First Quarter Earnings
Delta Air Lines kicked off earnings season for U.S. airlines on Wednesday.
The company beat Wall Street expectations and reported first-quarter revenue of $14.2 billion, up 9.4% year over year, and earnings per share of $0.64.
2026 remains uncertain for Delta as the Iran conflict continues. While the airline touted its strong first quarter, it will also be “meaningfully reducing” capacity until the fuel situation improves.
CEO Ed Bastian added that “it is premature to project the full year” and won’t provide an updated outlook at this time, highlighting the industry’s volatile situation with the ongoing geopolitical tensions.
Premium remains strong for the airline, and the first quarter was more evidence of resilient high spend consumers. Passenger revenue from its premium products, like Delta One and Delta Premium Select fares, grew 14%, and remuneration from American Express increased 13% to $2 billion.
Meanwhile, Main Cabin revenue saw growth for the first time since late 2024, up 1% year over year.
Link:
Delta’s Ed Bastian on Mergers
Bastian spoke on consolidation during his company’s earnings call on Wednesday:
“You have a considerable portion of the industry that has not returned its cost of capital, has not made a profit in years. And going back over the last decade, when we saw consolidation happen, we forget what drove consolidation. What drove consolidation was higher fuel prices back in 2009, ’10, ’11, and we were the leaders in that with the acquisition of Northwest in 2008.”
“I anticipate higher fuel prices will cause much more significant structural reform than we’ve seen over this period. COVID, I think, was a different animal where no one was strong enough to engage in the type of rationalization that was necessary. And as we look forward to building a healthier business for the future, there’s a number of business models that their owners are going to start questioning whether they continue to commit capital to. And however that plays out, it’s going to be a benefit to Delta.”
Bastian makes a good point on previous mergers, and the volatile, uncertain environment today is somewhat reminiscent of previous periods where the industry saw consolidation.
JetBlue’s interest in selling itself to a competitor has been a focal point recently in the industry. JetBlue hasn’t made a profit since 2019 and holds valuable assets in New York.
However, it remains to be seen how a JetBlue merger with United or American would benefit Delta, ramping up competition in the Northeast significantly. At the same time, an Alaska Airlines acquisition of JetBlue would raise the fewest antitrust issues, and other carriers like Spirit Airlines are also candidates to be involved in a merger.
Links:
Transportation Secretary Duffy on Consolidation
Antitrust hurdles have always been a limiting factor on airline mergers, and JetBlue faced a lot of them during the Biden administration. This led to a failed partnership with American and a failed acquisition of Spirit.
The Trump administration is likely more lenient on consolidation, and Transportation Secretary Sean Duffy reflected that during a CNBC interview this week:
“Who knows who is going to match up? There’s always chatter. Is there room for some mergers in the aviation industry? Yeah, I think there is,” Duffy said.
“If there was a merger between some of the larger airlines, they’re gonna have to peel off some of their assets,” he added.
With JetBlue’s interest in a sale, Spirit’s attempt to exit Chapter 11, and a volatile cost environment, there has been a lot of chatter on consolidation in the industry. Duffy’s latest comments suggest that the Trump administration is perhaps open to seeing these deals.
Link:
Earnings Season Schedule
It’s earnings season. Here’s a list of airlines and their first-quarter earnings dates:
- Alaska Airlines: April 20, 2026
- United Airlines: April 21, 2026
- Southwest Airlines: April 22, 2026
- American Airlines: April 23, 2026
- JetBlue Airways: April 28, 2026
Featured image by the author.
