General Lee
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USAir will cut capacity, expects industry to cut 9%, then 9% more in 09--article
Wednesday, June 11, 2008 - 5:36 PM EDT
US Airways shares fall 15% on shareholder meeting day
Philadelphia Business Journal
US Airways Group Inc. expects the U.S. airline industry to cut capacity 9 percent in the fourth quarter and 9 percent more next year because of escalating fuel costs.
"Oil prices are having a profound impact on our economy but an even more severe impact on the airline business," US Airways CEO Doug Parker said at the carrier's shareholder meeting Wednesday. "The industry is taking aggressive action that will have meaningful impact." Shares in the airline, the dominant carrier at Philadelphia International Airport, closed down 15 percent at $3.20.
US Airways has previously announced plans to cut capacity by 2 percent to 4 percent by the fourth quarter. The Tempe, Ariz.-based airline also is considering adding fees to boost revenue in addition to charges it has recently initiated.
Continental Airlines Inc. plans to shed 3,000 jobs and reduce capacity by 16 percent by year end. American Airlines Inc. will cut thousands of jobs and reduce mainline domestic capacity 11 percent to 12 percent during the fourth quarter.
Meanwhile, United Airlines plans to eliminate almost 1,500 positions, remove 100 aircraft from its fleet and eliminate its divisional brand, Ted. It will also reduce its domestic capacity by 14 percent in the fourth quarter. Parker did not mention jobs cuts during the shareholder meeting.
Oil has jumped to $134.18 per barrel from $80.73 at this time last year. US Airways says fuel will cost the industry $18 billion more in 2008 than last year. For US Airways alone, fuel costs will rise $2 billion this year. In 2008, US Airways' fuel expense per roundtrip mainline passenger is averaging about $300, almost double the cost last year. Fuel costs represent about half of the airline's expenses per ticket. It would have to charge about $650 per ticket just to break even, Parker said.
"We're nowhere close to that," he said. "No one in the business is close to that. This is a major problem."
Bye Bye--General Lee
Wednesday, June 11, 2008 - 5:36 PM EDT
US Airways shares fall 15% on shareholder meeting day
Philadelphia Business Journal
US Airways Group Inc. expects the U.S. airline industry to cut capacity 9 percent in the fourth quarter and 9 percent more next year because of escalating fuel costs.
"Oil prices are having a profound impact on our economy but an even more severe impact on the airline business," US Airways CEO Doug Parker said at the carrier's shareholder meeting Wednesday. "The industry is taking aggressive action that will have meaningful impact." Shares in the airline, the dominant carrier at Philadelphia International Airport, closed down 15 percent at $3.20.
US Airways has previously announced plans to cut capacity by 2 percent to 4 percent by the fourth quarter. The Tempe, Ariz.-based airline also is considering adding fees to boost revenue in addition to charges it has recently initiated.
Continental Airlines Inc. plans to shed 3,000 jobs and reduce capacity by 16 percent by year end. American Airlines Inc. will cut thousands of jobs and reduce mainline domestic capacity 11 percent to 12 percent during the fourth quarter.
Meanwhile, United Airlines plans to eliminate almost 1,500 positions, remove 100 aircraft from its fleet and eliminate its divisional brand, Ted. It will also reduce its domestic capacity by 14 percent in the fourth quarter. Parker did not mention jobs cuts during the shareholder meeting.
Oil has jumped to $134.18 per barrel from $80.73 at this time last year. US Airways says fuel will cost the industry $18 billion more in 2008 than last year. For US Airways alone, fuel costs will rise $2 billion this year. In 2008, US Airways' fuel expense per roundtrip mainline passenger is averaging about $300, almost double the cost last year. Fuel costs represent about half of the airline's expenses per ticket. It would have to charge about $650 per ticket just to break even, Parker said.
"We're nowhere close to that," he said. "No one in the business is close to that. This is a major problem."
Bye Bye--General Lee
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. I wonder what kind of pay we'll get tomorrow if we have a Mechanical cancelation? Oh yea...100%:laugh: . Got VACATION?? It's 31 days a year on the West if you've been around a while.
