Profits at America’s second-biggest airline by revenue fell by 18% in 2017. But Delta has sustained a far higher level of profitability than archrivals American and United Continental: Its operating margin of 15% reigns as best of the Big Three. Its in-house portfolio of refineries has helped it hold its own in the face of sharply rising fuel costs; Delta’s jet fuel bill rose 13% in 2017, beating the industry average by around seven points. It also kept a tight rein on wages and benefits, which rose only 4%, in line with revenues, and a new partnership with Aeromexico is off to a strong start. Delta’s biggest edge is its ability to win rich fares from business travelers. It controls more than 70% of the traffic at four major commercial markets: Atlanta, Detroit, and Minneapolis, and over 50% in Salt Lake City. Its dominance in those hubs shields Delta’s margins from inroads from budget competitors such as Southwest.
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