Among low-budget carriers, the bottom based on customer satisfaction was AirTran Airways followed closely by Frontier Air.

Power reported:

Alaska Airlines (NYSE: ALK) ranks highest in the traditional carrier segment for a sixth consecutive year, with an index score of 717. Alaska Airlines, which improves by 39 points from 2012 — the largest improvement among all carriers ranked in the study — performs particularly well in six of the seven factors: cost & fees; boarding/deplaning/baggage; aircraft; flight crew; check-in; and reservation.

Delta Air Lines moves up one rank position to second with a score of 682, improving by 23 points from 2012, with significant gains across all seven factors. Alaska Airlines and Delta Air Lines each improve significantly and perform well among traditional carriers in flight crew. Ranking third, Air Canada declines by six points to 671.

And

JetBlue Airways (NASDAQ: JBLU) ranks highest among low-cost carriers for an eighth consecutive year, with a score of 787. This also marks the ninth consecutive year JetBlue has ranked highest in the study. JetBlue, which improves by 11 index points on a year-over-year basis, performs particularly well in in-flight services and aircraft. Southwest Airlines (NYSE: LUV), which improves in all of the factors except cost & fees, ranks second at 770, which remains on par with 2012.

There has never been any solid evidence that customer satisfaction ratings actually affect the flying habits of travelers. However, that may be because as the number of carriers shrinks, so do the options to select alternatives.

Southwest Airlines announced Wednesday morning that its board of directors has quadrupled its quarterly dividend payment to $0.04 per share from $0.01 per share. The increase is for shareholders of record at the close of business on June 5, 2013, and will be paid on June 26, 2013.

Another boost is coming from the buyback plan. The existing $1 billion share repurchase program is being expanded to $1.5 billion. On top of that, an initial $250 million in its common stock will be repurchased under an accelerated stock repurchase program.

The new dividend will amount to a yield of 1.1%, based on the $13.98 close on Tuesday. Shares currently are trading higher by almost 3% at $14.39. That $1.5 billion share buyback compares to a market cap of $10.41.

As we have said before, United Continental Holdings Inc. (NYSE: UAL) is the main dividend sinner in the sector. The airline is considered the healthiest legacy carrier now that United and Continental have amalgamated into one company, and its market cap is $11.6 billion now that shares have rallied a whopping 70% in the past six months.

Delta announced on Wednesday that it plans to create $5 billion in value for shareholders. In that plan, $1 billion will be returned to shareholders over the next three years and the airline declared a $0.06 per share common dividend as a result. Delta will also spend up to $500 million to repurchase its common stock.

Together, the dividend and buyback programs will return more than $1 billion of capital to shareholders over the next three years. The dividend yield is approximately 1.3% if you take the 3.3% gain to $18.68 on Wednesday.

Currently, Southwest Airlines Co. (NYSE: LUV) is the only airline that pays a dividend. Its yield is very small at 0.3%, but this may pressure Southwest to seek higher payouts as well.

Delta shares are up 3.3% at $18.68 and the stock hit a new multiyear high of $18.84 today. The $0.24 annualized payout compares to $2.64 in earnings per share expected from Thomson Reuters for earnings in 2013.

24/7 Wall St. praises dividends. We also want to call out the myriad of great companies that need to realize that times demand investor payouts. A few companies are still buying growth, and we have identified some of these players as well. The thesis behind offering a solid dividend is that it instills confidence in investors that the company has earnings visibility for years even when the business cycle slows.

Having a real dividend policy may also be the key to keeping nervous investors from fleeing and going into cash or Treasury bonds, which pay almost nothing these days. There are just still too many companies in denial that they are still growth companies when they need to start directly rewarding shareholders. Some companies can get away without paying out a single cent to owners because the value of growth is so strong. That list is shrinking these days. Most companies we identified are in what we would call the “Dividend Sinners” category.

Our review focuses on Amazon.com Inc. (NASDAQ: AMZN), Bed Bath & Beyond Inc. (NASDAQ: BBBY), Berkshire Hathaway Inc. (NYSE: BRK-A), Dollar General Corp. (NYSE: DG), Dollar Tree Inc. (NASDAQ: DLTR), eBay Inc. (NASDAQ: EBAY), Electronic Arts Inc. (NASDAQ: EA), EMC Corp. (NYSE: EMC), Express Scripts Inc. (NASDAQ: ESRX), Jack in the Box Inc. (NASDAQ: JACK), Teradyne Inc. (NYSE: TER), United Continental Holdings Inc. (NYSE: UAL), Yahoo! Inc. (NASDAQ: YHOO) and Zebra Technologies Corp. (NASDAQ: ZBRA). We have handicapped whether investors might expect a dividend in the near-term or long-term from each of these as well.

The first order of business is to identify some of the great companies that have started paying a dividend since we (and others) have called for them to act with dividend payments in the past year or two. A few would include Apple Inc. (NASDAQ: AAPL), Dell Inc. (NASDAQ: DELL), Cisco Systems Inc. (NASDAQ: CSCO), Amgen Inc. (NASDAQ: AMGN), Symantec Corp. (NASDAQ: SYMC) and NASDAQ OMX Group Inc. (NASDAQ: NDAQ).

Today’s news is the confirmation of the death and implosion of this ETF, as it has not traded since March 15. There are actually nine ETFs that Guggenheim is closing. The FAA investors are set to receive a distribution of $42.986572 per share.

One problem that this ETF had was that there are too few stocks of importance to offer real diversity. The top three holdings were Southwest Airlines Co. (NYSE: LUV), Delta Air Lines Inc. (NYSE: DAL) and United Continental Holdings Inc. (NYSE: UAL). These three stocks accounted for nearly half of the ETF, which is something that investors do not like to generally see.

Investors who want exposure to the airline sector now likely will have to focus on the iShares Dow Jones Transportation Average (NYSEMKT: IYT). The problem is that airlines are extremely under-represented in this ETF. The hope is going to have to be that airlines are somewhat tied to the transportation sector each day.

Another ETF death has come about, and today is the funeral for the Guggenheim Airline ETF. In pilot terminology, this would be called a high-speed flame out.

The most notable thing about the stock peaks is that both regional carriers and large international carriers have done well. Perhaps the fact that an airline the size of Delta Air Lines Inc. (NYSE: DAL) has succeeded does not hurt the chances of Southwest Airlines Co. (NYSE: LUV) or Alaska Air Group Inc. (NYSE: ALK) doing well simultaneously. After years of debate about whether large carriers could run smaller ones out of the market because of huge route systems, or small carriers could cherry pick the best markets, the impression that each part of the industry can coexist profitably has become more acceptable.

Regardless how the debate about small versus large carriers sits with investors, one thing is clear. The huge price of jet fuel that plagued the industry off and on since 2008 has become less of a damaging factor to bottom lines. Part of the sea change is due to novel practices, like Delta’s purchase of refining capacity. More important, crude has dropped below $100 a barrel and appears likely to remain there for now.

The other advantage airlines have picked up is that the flying public continues to board planes in increasing numbers, as the airlines provide fewer and fewer seats. Capacity management has improved, in part because of mergers. Perhaps just as important, the long lists for fees that run from baggage fees to expensive snacks have not hurt demand. And taking a bus to most destinations is not an alternative option.

The airline recovery is on, and most current trends favor long-term prosperity.

The top U.S. airline measured by page views is Southwest Airlines Co. (NYSE: LUV), which garnered 20% of all airlines’ page views. Number two was Delta Air Lines Co. (NYSE: DAL), with 15.5%, followed by United Airlines with 14.7%, and American Airlines with 13.2%. Adding Continental to the United number gives a total for United Continental Holdings Inc. (NYSE: UAL) of 17.4%.

Among online travel agencies, Expedia Inc. (NASDAQ: EXPE) grabbed 31.6% of 2012 page views, down from 37.6% in 2011. Priceline.com Inc. (NASDAQ: PCLN) ranked second with 17.3%, up from 15.7% in 2011, and Orbitz Worldwide Inc. (NYSE: OWW), with 12.9% of page views, essentially flat with a year ago.

Among hotels and resorts, Marriott International Inc. (NYSE: MAR) took 11.7% of page views, with InterContinental Hotels Group Inc. (NYSE: IHG) second at 7.9%.

It’s a little hard to determine how big a piece of overall U.S. travel spending has moved online, but this chart indicates a total direct spend of $813 billion, for which online sales account for about one-eighth. And as a comScore executive noted:

Travel is a leading online commerce category, and despite being a pioneer in the sector 15 years ago it is still growing at nearly double-digit growth rates and remains very competitive.

The comScore data is available here.

With news of the AMR and U.S. Airways Group Inc. (NYSE: LCC) being all but reported as a signed pact, we wanted to know what might happen to prices and services. We will compare some numbers offered up by each airline to show what will become of the U.S. airline industry.

Since United Continental Holdings Inc. (NYSE: UAL) was merged from United and Continental, the general feeling of the public that we speak with is they are unhappy. Houstonians think that the great airline Continental was absorbed by a lower quality carrier in United. The airline may have many different survey figures on this, but we have not heard anything from flyers who are really favorable on the deal. Ticket prices have risen to many destination markets. Continental now charges for checked bags. It also does not allow most American Express rewards points to be used for the old Frequent Flyer program, and it no longer allows AmEx Platinum cardholders into the private airport lounges.

United shows that it and the United Express unit operate an average of 5,472 flights a day to 381 airports across six continents. In 2012, the combined carrier had more passenger traffic than any other airline in the world and operated nearly 2 million flights carrying 140 million customers. United operates more than 700 mainline aircraft and is planning to add more than two dozen Boeing planes in 2013. United claims more than 85,000 employees worldwide. It is also a founding member of Star Alliance.

U.S. Airways and its companies operate more than 3,000 flights per day, serving 198 communities around the world. It employs more than 32,000 aviation professionals worldwide. U.S. Airways is part of the Star Alliance.

AMR is currently still in bankruptcy. The good news is that there appears to be equity value remaining for the common holders. It serves more than 260 airports in more than 50 countries and territories with a fleet of nearly 900 aircraft flying more than 3,500 daily flights worldwide. AMR is a founding member of the oneworld Alliance.

Consumers who rely on U.S. Airways or AMR in their markets might face some pressure here. With an overlap of flight schedules in some markets, fewer flights lead to fewer available tickets and higher prices. The move would also create some potential issues in alliances as AMR is in the oneworld Alliance rather than the Star Alliance.

We already have been told to expect that route concessions likely will be a part of this approval process, and everyone now knows that mergers lead to layoffs of “redundant positions” in the workforce.

Here are the domestic hub cities of each major carrier, and you can see what will happen when a more powerful AMR can compete in the same hub cities as UAL:

• AMR — New York, Los Angeles, Dallas/Fort Worth, Chicago (O’Hare) and Miami
• U.S. Airways — Phoenix, Charlotte, Philadelphia
• UAL — Chicago, Cleveland, Denver, Houston, Los Angeles, Newark, San Francisco, Washington (Dulles)

What consumers need to understand is that airline mergers do not just allow the merger survivor to raise prices. Ticket prices that were once basement fares at JetBlue Airways Corp. (NASDAQ: JBLU) and Southwest Airlines Co. (NYSE: LUV) are now harder and harder to find. Delta Air Lines Inc. (NYSE: DAL) would remain out in the cold among the legacy air carriers after this merger.

If you think it is odd that many flights that may have cost you $350 or $400 round trip now cost $500 or $600 (or more), do not fall for this being “coincidence” at all. Airlines are very good at showing statistics about how their prices and service costs lead to being better airlines. Some even try sometimes to show that they lower ticket prices. You can trust their statistics or you can look at what you paid to fly recently on a normal flight compared to a couple of years ago.

When you hear about there not being any such thing as a free lunch, that is another thing that has gone away flying. And do not be shocked if and when you start seeing more baggage fees, change fees and rewards programs changing as well.

The airports, airlines, and travelers are all about to be hosed from this storm. A website we use to track airline data is FlightAware.com and the impact is going to be broad. As of about 11 AM there were already more than 4,000 flights to and from the area which have been cancelled. As this storm gets closer, you can expect the number of flight cancellations to grow further as a foot and a half or more is expected to hit Boston and the surrounding areas. It is so much snow that even Amtrak is closing some traffic.

Rhode Island is expected to get two feet of snow and even New Jersey may get a foot of snow. As far as which public airlines will be hit, the answer is almost all of them. The good news is that it is only having a mixed impact on the share prices of the carriers:

• AMR Corporation (OTC: AAMRQ) is up the most, perhaps as a merger of sorts is supposedly coming any day now. It looks like shareholders of the common stock won’t get entirely wiped out here. This stock is OTC but its shares are up 25% at $1.62 against a 52-week range of $0.36 to $1.66. US Airways Group, Inc. (NYSE: LCC) is down almost 2% at $14.83 against a 52-week range of $6.78 to $15.64.
• United Continental Holdings, Inc. (NYSE: UAL) is up over 2% at $26.29 against a prior 52-week range of $17.45 to $26.37. What matters here is that shares hit a new 52-week high of $26.44 earlier on Friday.
• Delta Air Lines Inc. (NYSE: DAL) is down 1.7% at $14.59 against a 52-week range of $8.42 to $14.89, but shares got within 1-cent of a 52-week high on Friday.
• JetBlue Airways Corporation (NASDAQ: JBLU) is up 0.7% at $5.93 against a 52-week range of $4.06 to $6.42.
• Southwest Airlines Co. (NYSE: LUV) is up 0.3% at $11.66 and shares hit a new 52-week high as the prior range was $7.76 to $11.65 today.

Click here to see the airlines charging the most and least in fees

In order to stay profitable in the current market, many airlines have raised or added fees in the past several years. Airfarewatchdog.com surveyed the fees of 14 major domestic airlines charge, finding 14 different extra charges. Some fees — such as charging for changing a flight, for checked bags, and even for blankets and pillows — have been met with outrage by travelers. 24/7 Wall St. reviewed Airfarewatchdog.com’s survey to identify the air carriers with the worst fees and ranked all the carriers, best to worst.

These days, U.S. carriers operate in a hyper-competitive market. Travel sites such as Travelocity, Orbitz, and Kayak have forced U.S. Air, American Airlines, and United to lower their fares. In fact, the fares have gone down so much that the carriers are losing money on many of their flights.

In an interview with 24/7 Wall St., Airfarewatchdog.com founder George Hobica explained that it is the sustained pressure on airlines to keep their fares low that has caused their declining profitability and forced them to levy increased fees. Adjusted for inflation, he explained, airfares are lower today than they were 20 years ago. Even with the extra fees, he added, the amount of money per passenger the airlines make remains well below what they made more than a decade ago.

The airlines with the greatest financial difficulties also tend to charge higher fees in order to help them stay afloat. American Airlines, which has by our calculation the highest fees, lost more than $1.1 billion in operating revenue in 2011, leading up to its second bankruptcy. The airlines that charge the lowest fees, like Southwest, and Alaska, remain profitable.

The main difference between Airlines such as Southwest and Alaska are able to remain profitable and consequently charge lower fees, while others such as U.S. Air, United, and American cannot is age, said Hobica. The low-fee airlines are younger, with younger fleets, which cost less money to maintain. Also, they have younger employees who do not need to be paid as much as legacy employees at older airlines. This is one of the key reasons, Hobica explained, “U.S. airlines are behind the eight-ball: they have labor rules [and] they can’t fire these people.”

A review of the airlines with the highest fees shows that most had among the worst customer service ratings. American and United, which had among the five-highest fees, also had the worst customer service rating from the American Customer Satisfaction Index. Southwest, which had among the lowest fees, scored as one of the best on the ACSI.

Hobica explained this makes sense considering the history of these larger, older airlines. “Some of the newer airlines, like JetBlue and Virgin America — their employees have not been battered as much as some of the mainline carriers like American, United, and Delta. A lot of these employees lost their pensions and have been mistreated by the management, and so they’re more jaded,” he said.

Using Airfarewatchdog.com’s report on the type of fees each of the 14 major U.S. domestic carriers charges, 24/7 Wall St. totaled the amount a passenger would pay if he or she paid at least the minimum fee in each of the 14 fee categories. These categories include fees for additional checked bags, overweight bags, food and drink, flight change fees, and booking fees. In addition to the fee data from Airfarewatchdog.com, we considered airline operating profit and revenue, as collected by the Bureau of Transportation Statistics. We also reviewed customer satisfaction scores for many of these airlines, which we obtained from the American Customer Satisfaction Index.