This is a company e-mail I just recieved from Scott Hall at ASA...
Sept. 4 (Bloomberg) -- Delta Air Lines Inc. and the other big U.S. carriers are poised to make more cuts in available seats as the summer travel season ends this weekend, capping the industry’s deepest retrenchment since World War II.
Capacity at the six largest airlines, led by Delta, will shrink 6.8 percent by year’s end from 2008 levels, according to data compiled by flight information firm OAG Aviation Solutions for Bloomberg News. That’s equal to erasing the domestic network of US Airways Group Inc., the No. 6 U.S. carrier by traffic.
The analysis by OAG and a separate assessment by the Air Transport Association trade group show the scope of U.S. carriers’ pullback to counter slumping business travel in the recession and the usual end-of-year decline in leisure fliers. Some analysts say the reductions aren’t done.
“There’s no point putting seats in the air if people don’t want to fly,” said David Swierenga, president of aviation consulting firm AeroEcon in Round Rock, Texas. “A double-digit cut, more than 10 percent, in capacity is called for.”
The six biggest carriers posted a 4.2 percent slide in August traffic on their main jet operations, based on results released today by Delta and Southwest Airlines Co., the last two companies to report. It was the 15th straight monthly drop in miles flown by paying passengers.
Computing Capacity
Capacity is measured in available seat miles, or the number of seats multiplied by the number of miles flown. Airlines’ benefits from flying less are lower costs and fewer tickets for sale, a move intended to lead to higher fares.
OAG and the Washington-based Air Transport Association examined different groups of airlines in sizing up the industry’s full-year contraction. Carriers don’t report their planned reductions the same way and usually don’t announce what routes or flights they’re discarding.
OAG, based in Downers Grove, Illinois, reviewed post-Labor Day schedules to compute how much 2009 flying will be chopped in the U.S. and overseas by Delta, AMR Corp.’s American Airlines, UAL Corp.’s United Airlines, Continental Airlines Inc., Southwest and US Airways. The ATA said industrywide seating capacity would fall 6.9 percent on domestic routes in 2009.
1942 Benchmark
That would be the most since a 12 percent drop in 1942, the first full year of U.S. involvement in World War II, according to ATA data. Based on available seats, the U.S. industry is about 450 times larger now than 67 years ago.
The ATA’s analysis means that the 2009 capacity cuts would dwarf airlines’ 3.9 percent pullback in 2002, the year after the Sept. 11 terrorist attacks, and the 4.4 percent drop in 1974 amid the oil-price shock.
“As far as I’m concerned, they can’t cut enough capacity,” said Hunter Keay, an analyst at Stifel Nicolaus & Co. in Baltimore. “Every little bit helps.”
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U.S. Airlines? Cut in Seats to Be Deepest Since 1942 (Update2) - Bloomberg.com#
Why does he send doom and gloom e-mails to employees? We all know conditions are bad right now. Is he trying to get morale so low that we take a reduction in pay? I don't get it... Why beat a dead horse? What is the point of this? I guess I'm just ranting here... and drinking.