Mon, Mar 31, 2003
20 Percent Drop In Bookings
Domestic and international travel on U.S. airlines
is off sharply because of the Iraq war with the industry cutting
more than 10,000 jobs in the past week, according to the Air
Transport Association (ATA).
ATA executives said domestic bookings are down 20 percent when
looking out over the next 60 to 90 days. International bookings are
down more than 40 percent in some regions. James May, the
group’s president, also said in a conference call with
reporters that airlines have eliminated 10,000 jobs since the past
week, and remains on track to cut 70,000 positions if the U.S.-led
military action lasts at least 90 days.
The Flow Of Red Ink Worsens
Losses over that period could reach $4 billion, the group
reaffirmed. May said the industry is coming to a point where the
sustained decline in travel and rising fixed costs, like labor and
fuel expenses, could push more financially fragile carriers into
bankruptcy.
“Given the economic circumstances of the industry, it is
not that far down the road,” May said. United Airlines and US
Airways are both in bankruptcy and American Airlines may take that
step in the coming weeks and months.
More Help From Washington?
The industry wants government help to offset
losses related to war. But Congress and the Bush administration
have not reached any consensus on any assistance package. Ted
Stevens (R-AK), chairman of the Senate Appropriations Committee,
said on Wednesday he was ready to offer an airline aid proposal
next week in an emergency spending bill covering war-related
expenses. Stevens did not detail his plan, but lawmakers have shown
increasing interest lately in providing airlines with relief from
some aviation security costs as well as help with meeting high-risk
insurance expenses.
“We have been heartened by a number of public comments
from both sides of the aisle and both sides of the hill,” May
said. “But I don’t think we can say we have any
agreement that anything is going to happen yet.”
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