Commercial Aviation Legacy Airlines Must Further Reduce Costs To Restore Profitability Report To Congressional Committees PDF Download

The U.S. passenger airline industry is vital to the U.S. economy. Airlines directly generate billions of dollars in revenues each year and catalyze economic growth. Interest in the airlines' ability to weather volatile fuel prices and the economic recession led to congressional requests for a GAO review. GAO examined how (1) the financial condition of the U.S. passenger airline industry has changed, the principal factors affecting its condition, and its prospects for 2009; (2) airlines have responded to the factors affecting their financial condition; and (3) changes in the industry have affected airports, passengers, and the Airport and Airway Trust Fund (Trust Fund), which funds the Federal Aviation Administration's (FAA) capital programs and most of its operations. To do this, GAO analyzed financial and operating data, reviewed studies, and interviewed airline, airport, and FAA officials and other experts. The Department of Transportation (DOT) provided technical comments, which were incorporated as appropriate. In light of the declining uncommitted balance in the Trust Fund, Congress should consider working with FAA to reduce the risk of over committing budgetary resources from the Trust Fund so that resources are available to cover all the obligations that FAA has the authority to incur and reduce the risk of disruptions in funds for aviation programs and projects.