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American to Cut Flights; Continental May Follow

Posted on: Saturday, 1 October 2005, 00:00 CDT

By Bill Hensel Jr., Houston Chronicle

Oct. 1--American Airlines, citing skyrocketing fuel costs, said Friday it would cut some flights, and Houston-based Continental is likely to do the same.

At the same time, several major airlines were hoping a fare increase instituted this week would stick.

American Airlines said Friday it would temporarily cut 15 daily flights from its two major hubs, including two to George Bush Intercontinental Airport. Continental said Friday it likely will also cut flights because of fuel costs.

Airlines are paying record prices for fuel, a trend that's expected to continue because of disruptions to refineries on the Gulf Coast after hurricanes Katrina and Rita.

One of the flights American will eliminate next month is between Houston and Dallas-Fort Worth International Airport. Another is between Houston and Chicago's O'Hare International Airport.

American, however, emphasized that it will still have nine flights a day to DFW and three flights to O'Hare from Intercontinental.

Continental said Friday it anticipates that flights would be suspended temporarily in certain locations. The airline said the move would come "as a result of the unprecedented cost of jet fuel."

"We are in the process of reviewing our October schedule and anticipate we may suspend flights temporarily suspend flights in select markets," Continental said.

Northwest Airlines said Friday that fuel prices were the reason it suspended its daily Minneapolis-to-London flight from Oct. 30 to March 9 and would reduce its Detroit-to-Paris flight from daily to five per week from Jan. 16 to March 9.

Northwest had already suspended its New York to Tokyo nonstop, instead sending passengers through Minneapolis or Detroit.

On the fare front, Continental raised many domestic fares by $20 round trip on Thursday, which most other airlines were matching, albeit in some different ways. It remains to be seen whether the increase will stick.

American, United and Delta matched the new fares.

Aviation consultant Alan Sbarra said airlines are cutting flights to try to recoup some additional cash.

"They are taking out some flights where they already have other flights anyway," Sbarra said.

Travel expert Terry Trippler said fuel expenses leave theairlines little choice but toact.

"With fuel at the current costs, the airlines will be forced to cut marginal flights," Trippler said. "But the way things have been going lately, it looks like all flights are marginal."

American noted that jet fuel prices have been rising even faster than crude oil prices for the past year.

"But it was the 39 percent rise in jet fuel costs in the last month alone that pushed us to make this decision," said Dan Garton, executive vice president for the Fort Worth-based carrier.

American said jet fuel is 91 percent more expensive than it was in September of 2004.

American also announced it would discontinue service between O'Hare and Nagoya, Japan, at the end of October.

Some of American's reductions start Oct. 5, while others take effect Oct. 12.

The airline will evaluate the jet fuel market toward month's end and decide whether to restore the flights or take additional action.

The Associated Press contributed to this report.

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AMR, CAL, DAL, UALAQ,

Source: Houston Chronicle

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