This Helped American Airlines (NASDAQ: AAL) Make A Huge Comeback

After decades of financial struggle for airlines, American, Delta, and United have all recently reported record profits. American Airlines saw its profits surge 50% in 2015 to $6.3 billion.

American Airlines CEO Doug Parker thinks the profitability struggles may finally be over. “My personal view is that you won’t see losses in the industry at all,” said Parker at the airline’s annual meeting last week. “We have gotten to the point where we like other businesses will have good years and bad years, but the bad years will not be cataclysmic. They will just be less good than the good years.”

The industry has had little room for error due to thin margins and high capital requirements. This has been hard for airlines and has left many on the brink of bankruptcy. Airline management has to be focused and efficient by focusing on areas that deserve the most investment and what customers can do without.

Cheap crude prices have also helped boost financial performance in the last two years.

Last month at Delta’s media day, CEO Ed Bastian noted that current oil prices are nearly identical to that in 2005. Last year the company reported $4.5 billion profits and even returned $1.5 billion in profit-sharing to employees.

Disclaimer: We have no position in American Airlines Group Inc. (NASDAQ: AAL) and have not been compensated for this article.