United Cuts Flights, Discounter Ted

By Barbara De Lollis

Reeling from runaway fuel prices, United Airlines announced among the deepest cutbacks yet by major U.S. carriers in flying plans for the fall.

United also said it is eliminating Ted, the Denver-based discount arm launched in 2004 to counter low-fare carriers such as Frontier and Southwest. Ted caters to leisure travelers with only coach-class seating, but starting next spring, its 56 Airbus A320s will be reconfigured with United first-class seats.

United also is cutting large-jet domestic flying by 14% in the October-December period and eliminating as many as 1,600 jobs. Its North American flying next year will be down at least 17% vs. 2007.

United is retiring all 94 of its Boeing 737s and six Boeing 747s.

It isn’t the only carrier jettisoning unprofitable planes and routes. Excluding their regional airline flying, Delta has said it’s cutting 10% of its capacity in the fourth quarter, and American plans to cut 12% from a year ago. They hope to reduce costs and boost fares by shrinking the supply of seats.

Leisure travelers will be among those most affected by the sweeping reductions, said George Hamlin, an aviation consultant at ACA Associates. Many large airlines are trying to attract a more balanced mix of business and leisure travelers, instead of carrying a majority of lower-paying leisure travelers, he says.

“You’re not going to see very many $99 fares to California and $69 Northeast-Florida fares anymore,” Hamlin said.

United didn’t specify the changes to come this fall, but the company said in a statement that the cuts will mainly take the form of fewer frequencies on some routes and “modest reductions of routes and destinations.” United serves more than 200 U.S. and international destinations. It said it’s committed to preserving its hubs at Los Angeles, San Francisco, Denver, Chicago O’Hare and Washington Dulles.

Because of the elimination of Ted, which this month serves 23 airports, passengers could lose some inexpensive flights to vacation spots. From Denver, for instance, Ted flies to Tampa, Reno and Puerto Vallarta in Mexico. (c) Copyright 2008 USA TODAY, a division of Gannett Co. Inc.