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Originally published March 3, 2014 at 11:01 AM | Page modified March 3, 2014 at 11:02 AM

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The economic toll of winter’s canceled flights: $5.3 billion

Counting up the cost of passengers’ missed trips, and airlines’ extra expenses, after severe U.S. winter weather forces cancellation of tens of thousands of flights,


Bloomberg News

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Severe winter weather cost U.S. airline passengers $5.3 billion in expenses and missed workdays as carriers canceled and delayed trips in the worst period of flight disruption since Sept. 11.

The cost to airlines may be as much as $500 million on increased operating expenses and lost revenue, according to industry data tracker MasFlight. Cancellations from Dec. 1 through Feb. 28 totaled 108,600, almost double the average of previous winters of 57,600.

MasFlight’s estimate offers a glimpse at the economic toll from snow and storms that pummeled a broad swath of the country this winter, disrupting travel plans for more than 90 million people. United Continental has signaled a key revenue gauge will be lower this quarter as a result.

“This will be remembered as one of the worst winter storm periods in aviation history,” said Tulinda Larsen, vice president of Bethesda, Maryland-based MasFlight, in an interview.

And it’s not over. Yet another storm swooped through the mid-Atlantic on Monday, which could dump as much as 8 inches of snow in Washington, D.C. . More than 2,400 flights were canceled as of Monday morning, according to FlightAware, for a total of more than 4,800 since the beginning of the month.

The storm is the latest in a season that has set many records and shows little sign of ending soon. January racked up more than 49,000 cancellations, as many as the past three Januaries combined, MasFlight said previously. Feb. 13 was the worst day of winter with 7,561 cancellations, topping the 7,400 on Oct. 29, 2012, that resulted from Hurricane Sandy.

The flight cancellation rate this winter of 5.5 percent exceeded the last severe winter period of 2010-2011 of 4.3 percent, MasFlight said in a release today. The total cost to passengers this winter compares with a typical winter average of $2.9 billion and an average over the two previous winters of $1.5 billion.

The storms affected the country’s biggest airline hubs, including airports in Chicago, Atlanta, and the busiest airspace in the U.S., the New York-New Jersey region, resulting in about $4.5 million in costs for airports, MasFlight said.

United, American Airlines., US Airways and JetBlue topped the list of cancellation rates during the period, MasFlight said.

United, the world’s second-largest airline, was the first airline to detail how the storms will affect its finances. It said last week that revenue for each seat flown a mile will decline this quarter because the winter storms caused more than 22,500 flights to be canceled.

Tarmac rule at play

New operational regulations since the winter of 2009-2010 have also had a “profound impact” on flight completions and passengers, MasFlight said.

The Tarmac Rule, which became effective in April 2010 for domestic flights, limits the time an aircraft can spend taxiing, leading airlines to cancel flights to avoid fines of as much as $27,500. De-icing an aircraft can take as long as 45 minutes which can lead to violations of the delay rule, MasFlight said.

“With limited gate capacity available, airlines continue to cancel flights to best utilize available de-icing and runway capacity,” MasFlight said in its release.

Another rule took effect Jan. 4 and limits pilots’ work hours.

“When the cusp of a significant adjustment like this coincides with serial bad weather across the country and a heavy holiday traffic period, it would be unrealistic to expect good things to happen,” said Bob Mann, a former American Airlines executive who is now president of aviation consultant R.W. Mann & Co. in Port Washington, New York, in an emailed response to questions. “And they didn’t, and in some cases didn’t for days.”

The harsh weather across the East Coast and Midwest created a ripple effect that reached California (and the rest of the West) as airlines’ schedules, crews and aircraft logistics changed, Mann said.

“No place is immune to disruption, even if it seems remote to an actual weather event and disturbance,” he said.



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