U.S. airlines' on-time performance improved in July from both a year ago and a month earlier, the Department of Transportation said Tuesday. It noted the first seven months of the year have had the highest rate of on-time arrivals in six years.

Results have improved, in part, due to fewer planes in the skies amid falling travel demand.

The DOT's Bureau of Transportation Statistics said the 19 carriers reporting on-time performance had an overall rate of 77.6% in July, up from 75.7% a year earlier and 76.1% in June. The agency said carriers canceled 1.2% of their scheduled flights, compared with 1.7% a year earlier and 1.5% in June.

A flight is counted as "on time" if it operated less than 15 minutes after the scheduled time shown in the carriers' computerized reservation system.

Regional carrier Comair Ltd. (COM.JO) again had the worst on-time performance in July at 63.6%, while Hawaiian Holdings Inc.'s (HA) Hawaiian Airlines again had the best, with a 93.6% rate. Atlantic Southeast Airlines has the second-worst rate, at 68.3%, followed by AirTran Holdings Inc.'s (AAI) AirTran Airways at 69.8%. Alaska Air Group Inc. (ALK) followed Hawaiian Airlines atop the timeliness list at 87.2%.

The most frequently delayed trip for July was Northwest Airlines Corp.'s (NWA) flight 1266 from Boston to Tampa, which was late 96.8% of the time.

Meanwhile, the industry had a mishandled baggage rate of 3.98 per 1,000 passengers in July, down from 4.87 in July 2008 and 4.17 in June. The DOT also received 827 complaints in July, down from 1,093 a year ago but up from 747 in June.

-By Joan E. Solsman, Dow Jones Newswires; 212-416-2291; joan.solsman@dowjones.com