Anyone following the story of the American airline industry over the past year knows that Southwest Airlines has held an ace in the hole with their successful fuel hedging operations that have saved the company millions of dollars. When United finally decided to hop on the hedging bandwagon, they managed to lose hundreds of millions.
According to the Airline Biz Blog, United Airlines managed to lose more than $500 million as they dipped their toes into the fuel hedging arena. United’s executives have managed to make the dramatic drop in oil prices a negative rather than a positive for the beleaguered airline.
These days, United Airlines just can’t win. If it isn’t the problem of an inadvertent publication of an old bankruptcy notice driving their stock down precipitously, it is the specter of losing money on falling jet fuel prices.
Perhaps the “high cost of jet fuel” mentioned by United Airlines as the justification their hike in the second-checked-bag fee has been self-inflicted.
