Airlines Try to Learn From Past

A perfect mix of high demand for seats combined with low supply has transformed the once gloomy airline industry, where it now seems that nothing can possibly go wrong.

But can it? Throughout their history, airlines have failed to capitalize on such opportunities. Since the Wright Brothers' first flight in 1903, U.S. commercial airlines have posted a net loss of about $17 billion, according to the Air Transport Association. From 2001 through 2005, the industry lost $35 billion.

This year should mark a turnaround, with the ATA forecasting a net profit, excluding one-time charges, of at least $1 billion. But if the past is a guide, the future remains in doubt.

"We live in a very volatile industry," said Ed Bastian, chief financial officer of Delta Air Lines(DALRQ Quote), in an interview. "We're subject to geopolitical risk, to a fuel spike, to whatever world events might come our way, and I'm not certain that [low fuel prices] have any staying power.

"But the biggest risk to me, forgetting the geopolitical for the moment, is the [industry] environment," Bastian said. "We've had capacity discipline for the last year that has bolstered our ability to price our product. I hope that we as an industry are able to maintain our discipline. There's always a temptation to fly more, to try to bring more capacity in. I think most of the industry gets that, but there's always a risk that somebody [won't]."