jujube
Jun 24, 07, 11:41 am
From Reuters - another confirmation on what we already know :p
As frustrated as travelers may be with crowded planes and delayed flights, these are the realities of the leaner U.S. airline industry as it claws its way back to profitability after a brutal years-long slump. If carriers want to ensure long-term survival, they say they have no choice but to restrain capacity, fill as many seats as possible and cut costs wherever they can. And for travelers who don't like it, there is always the bus.
Experts say carriers are unlikely to lose much business as a result of recent big snafus like Wednesday's systemwide computer glitch at UAL Corp.'s (UAUA.O: Quote, Profile, Research) United Airlines that delayed nearly 270 flights. In the end, carriers' bottom lines are better served by running tight ships, even if that means the occasional customer service nightmare, they say. "On one hand, it's good because it puts airlines closer to profitability," airline consultant Michael Boyd said. "On the other hand, it's bad because there is no excess slack in the system."
U.S. airlines are on the mend after years of losses stemming from terror concerns, soaring fuel costs and low-fare competition. Since 2001, four major carriers have slashed costs in bankruptcy. Meanwhile, many carriers have reined in capacity -- the number of seats for sale -- to fly fuller planes. The Air Transport Association, a U.S. industry trade group, says planes on average will be more than 80 percent full this summer as a record 209 million travelers take to the skies.
As frustrated as travelers may be with crowded planes and delayed flights, these are the realities of the leaner U.S. airline industry as it claws its way back to profitability after a brutal years-long slump. If carriers want to ensure long-term survival, they say they have no choice but to restrain capacity, fill as many seats as possible and cut costs wherever they can. And for travelers who don't like it, there is always the bus.
Experts say carriers are unlikely to lose much business as a result of recent big snafus like Wednesday's systemwide computer glitch at UAL Corp.'s (UAUA.O: Quote, Profile, Research) United Airlines that delayed nearly 270 flights. In the end, carriers' bottom lines are better served by running tight ships, even if that means the occasional customer service nightmare, they say. "On one hand, it's good because it puts airlines closer to profitability," airline consultant Michael Boyd said. "On the other hand, it's bad because there is no excess slack in the system."
U.S. airlines are on the mend after years of losses stemming from terror concerns, soaring fuel costs and low-fare competition. Since 2001, four major carriers have slashed costs in bankruptcy. Meanwhile, many carriers have reined in capacity -- the number of seats for sale -- to fly fuller planes. The Air Transport Association, a U.S. industry trade group, says planes on average will be more than 80 percent full this summer as a record 209 million travelers take to the skies.