American Airlines says airfares will stay high despite fuel drop
American Airlines has warned that airfares will likely remain high even if fuel costs decrease, citing a need to offset previous losses and recover yields. The carrier reported deeper-than-expected losses for the third quarter and expects fuel prices to remain elevated through the end of the year.
Why it matters
This signals a shift in airline pricing strategies that could impact consumer travel costs and the broader economic recovery of the aviation industry.
American Airlines issued a warning that airfares are likely to remain elevated even if there's a decline in oil prices after losses the carrier suffered earlier in the year amid surging fuel costs. The carrier's CFO, Devon May, told the Financial Times that "if fuel comes down, I think airfares probably stay largely where they're at right now." "If fuel prices go up, we need to generate higher yield, we need to generate higher fares to offset that higher fuel price," May said. American Airlines on Thursday released its earnings for the third quarter, reporting deeper losses in 2026 and updating its forecast to reflect anticipated losses between $1 and $1.60 a share on an adjusted basis this year. Its July forecast ranged from a loss of 65 cents and a profit of 65 cents.
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