Continental to Reduce Flights and Staff

Continental Airlines has announced significant reductions in flights and staff to further adjust to the high cost of fuel, and is also reducing the size of its fleet by removing the least efficient aircraft from its network.

As a result of the capacity reductions, Continental will need fewer co-workers worldwide to support the reduced flight schedule. About 3,000 positions, including management positions, will be eliminated through voluntary and involuntary separations, with the majority expected to be through voluntary programs.

Starting in September 2008, at the conclusion of the peak summer season, Continental will reduce its flights, with fourth quarter domestic mainline departures to be down 16% year-over-year. This will result in a reduction of domestic mainline capacity by 11% in the fourth quarter, compared to the same period in 2007.

Continental is accelerating the retirement of its Boeing 737-300 and 737-500 fleets. The carrier will retire an additional 67 Boeing 737-300 and 737-500 aircraft, with 37 of these additional retirements occurring in 2008 and 30 in 2009. Given the need for prompt capacity reductions, 27 of the 67 aircraft will be removed in September 2008. By the end of 2009, all 737-300 aircraft will be retired from Continental’s fleet.

Continental will continue to take delivery of new, fuel-efficient NextGen 737-800s and 737-900ERs. Overall fuel efficiency is expected to improve measurably as Continental takes delivery of 16 of these aircraft in the second-half of 2008 and 18 in 2009.