Airline Quality Rating: Virgin America tops industry's second best year ever

WEST LAFAYETTE, Ind. - Airline performance in 2012 was the second highest in 23 years that researchers have tracked their performance, according to the 23rd annual national Airline Quality Rating.

"Passengers are experiencing better performance by the airlines, although it might cost more to fly," said Brent Bowen, professor and head of Purdue University's aviation technology department.

The performance of the nation's leading carriers in 2012 was nearly identical to the best year ever in 2011.

The rankings released Monday (April 8) at the National Press Club show that of the 14 carriers rated for performance in both 2011 and 2012, seven airlines improved, five airlines declined and two are new to the rankings, including the overall No. 1 performing airline, Virgin America.

The Airline Quality Rating is a joint research project funded as part of faculty research activities at Purdue and Wichita State University.

The industry improved in two of the four elements of the AQR: on-time performance and baggage handling. Involuntary denied boardings and customer complaint rates were higher in 2012.

The AQR score reflects commendable efforts by the airline industry to serve customers in a capacity-limited air travel system, according to Dean Headley, associate professor of marketing at the W. Frank Barton School of Business at Wichita State.

"As the system adjusts to increasing demand for air travel with a limited capacity of seats available, operations must be carefully handled for things to go as planned for travelers," Headley said. "During 2012 the industry improved the mishandled baggage rate by 8 percent, suggesting that most airlines are working hard to accommodate customers. Still, nearly a third of the customer complaints for 2012 were for flight problems, such as unplanned schedule changes, delays and cancellations.

"When you look at the past 13 years, you find that the airline industry performs most efficiently when the system isn't stressed by high passenger volume and high number of airplanes in the air. Every time there are more planes in the sky and more people flying, airline performance suffers."

The challenge is whether airline performance quality improvements can be maintained as more people choose to fly. Or, does the infrastructure and air traffic control technology limit what airlines can do?

"Further airline consolidation will continue to reduce the number of air carriers ranked in the AQR," Bowen said. "Past AQR data suggests that the combining of two large air carrier operations often results in subsequent decreases in AQR rankings. We will be carefully watching to see if two highly rated carriers, such as former No. 1 AirTran and Southwest, will reverse this trend."

An electronic version of the full report, with details on each airline, is available at http://airlinequalityrating.com.

Inside this year's rating

Below is the current numerical ranking of the nation's leading 14 airlines, according to the Airline Quality Rating, with the previous year's ranking in parentheses:

1. Virgin America (new to the ranking this year)

2. JetBlue (3)

3. AirTran (1)

4. Delta (6)

5. Hawaiian (2)

6. Alaska (5)

7. Frontier (4)

8. Southwest (7)

9. US Airways (8)

10. American (10)

11. American Eagle (15)

12. SkyWest (9)

13. ExpressJet (not rated in 2011)

14. United (12)

The rankings changed most noticeably for American Eagle Airlines (from 15 up to 11) for 2012. Virgin America came into the rankings as the top-rated airline. JetBlue (2) and AirTran (3) both maintained their top-tier positions for 2012.

On-time performance

Hawaiian Airlines had the best on-time performance (93.4 percent) for 2012, and ExpressJet and American had the lowest (76.9 percent).

Eight airlines improved their on-time arrival performance in 2012. Nine of the 14 airlines rated had an on-time arrival percentage of better than 80 percent. On-time for the industry in 2012 was 81.8 percent compared to 80.0 percent in 2011.

Denied boardings

JetBlue had the lowest involuntary denied boardings at 0.01 per 10,000 passengers. SkyWest had the highest involuntary denied boarding rate at 2.32 per 10,000 passengers.

Overall, five airlines improved their denied boardings rate in 2012. American Eagle recorded the greatest improvement, and SkyWest had the largest decline. JetBlue and Virgin American are clearly the industry leaders in avoiding denied boarding incidents.

Industry performance was worse in 2012 (0.97 per 10,000 passengers) than it was in 2011 (0.78).

Baggage handling

Virgin America had the best baggage handling rate (0.87 mishandled bags per 1,000 passengers) of all airlines, and American Eagle had the worst baggage handling rate (5.80 mishandled bags per 1,000 passengers) of all the airlines.

Seven of 14 airlines improved their mishandled baggage performance for the year. The rate for the industry decreased from 3.35 per 1,000 passengers in 2011 to 3.07 in 2012.

Consumer complaints

Southwest again had the lowest consumer complaint rate (0.25 per 100,000 passengers) of all airlines. United had the highest consumer complaint rate (4.24 per 100,000 passengers) of the airlines rated.

Customer complaints per 100,000 passengers increased from 1.19 in 2011 to 1.43 in 2012. The majority of complaints were for flight problems (32.7 percent), reservations, ticketing and boarding (14.6 percent), customer service (14.3 percent), and baggage (12.4 percent).

More about the Airline Quality Rating

As the nation's most comprehensive study of airline performance and quality, the Airline Quality Rating sets the industry standard, providing consumers and industry watchers a means to compare performance quality among airlines using objective performance-based data.

No other study in the country is based on performance measures like the AQR. Criteria included in the report are screened to meet two basic elements: They must be readily obtainable from published data sources for each airline, and they must be important to consumers regarding airline quality. The resulting criteria include areas such as baggage handling, customer complaints, denied boardings and on-time arrivals.

Reports from consumers to AQR researchers have become increasingly popular during the past several years, say Bowen and Headley. The co-authors invite the flying public to participate in the Annual Passenger Survey at http://www.wichita.edu/aqrconsumersurvey.

Writers: Jim Schenke, 765-237-7296, jschenke@purdue.edu

Joe Kleinhasser, 316-204-8266, joe.kleinhasser@wichita.edu

Source: Brent Bowen, bdbowen@purdue.edu

Note to Journalists: An electronic version of the full report will be available after 9:30 a.m. Eastern time Monday (April 8) at http://airlinequalityrating.com. Click on the "press release" tab to access the ratings directly. Brent Bowen is available for interviews in person in Washington, D.C., or by phone or Skype by contacting Jim Schenke at 765-237-7296. To reach Dean Headley, call the Hilton Garden Inn in Washington, D.C., at 202-783-7800.