=20 ---------------------------------------------------------------------- This article was sent to you by someone who found it on SF Gate. The original article can be found on SFGate.com here: http://www.sfgate.com/cgi-bin/article.cgi?file=3D/news/archive/2002/05/03/f= inancial1409EDT0159.DTL ---------------------------------------------------------------------- Friday, May 3, 2002 (AP) Air passengers stand to benefit this summer, even if airlines don't BRAD FOSS, AP Business Writer (05-03) 11:09 PDT (AP) -- With BC-Summer Travel, Bjt Faced with fewer flight delays and cheaper airfares, airline passengers stand to benefit this summer from a transportation system under less strain than it has been in years. Most major carriers, though, remain mired in the financial funk that engulfed them after Sept. 11 and resulted in an industrywide loss of $2.4 billion during the first three months of the year. While passenger demand has gradually improved since the sharp dropoff th= at followed last year's terrorist attacks, it remains about 10 percent below year ago levels. Because of the industry's high costs for labor and fleet maintenance, the loss in revenue has made it virtually impossible for the biggest airlines to turn a profit despite massive layoffs and the elimination of travel agents' commissions. Robert Mann, airline consultant at R.W. Mann & Co. in Port Washington, N.Y., said major carriers are on a "dead-end path," unless they can find a way to dramatically cut costs. Wall Street analysts have predicted that industrywide losses for the year could exceed $3.5 billion. There is a bright side, though, to the industry's economic troubles -- f= or consumers. Leisure fares remain down about 6 percent as carriers discount their inventory to fill up planes. At the same time, major airlines have improved their on-time performance even as airport security gets tighter, because industry cutbacks have led to reduced congestion on runways and in the skies. Notwithstanding the occasional airport evacuation, the new emphasis on security has, in fact, made the industry more punctual, said Henry Joyner, American Airlines' senior vice president of planning. "Passengers are showing up earlier than they used to," enabling more planes to keep to their published schedules, he said. Eighty-five percent of major airlines' flights arrived on time in February, the most recent period for which data exists, compared with 73 percent during the same month a year ago, according to the Department of Transportation. But if the improvement is the result of passengers spending more time inside airports before flights, it isn't necessarily such a good deal, said David Stempler, president of the Air Travelers Association, a Washington-based trade group. Recognizing that every minute counts when it comes to keeping customers happy, especially on shorter routes, several major carriers recently revised the amount of time passengers should expect at the airport in preparation for departures. Southwest Airlines said passengers should arrive an hour in advance, instead of 90 minutes, while United Airlines said an hour would be enough time as long as no baggage needs to be checked. Still, the unpredictability of the airport screening process is responsible for at least a portion of the decline in business travel. "They've heard the horror stories," said Stempler. With that in mind, renting a car or riding a train is often seen as a better way to travel if the trip is no longer than a couple hundred miles. On the East Coast, for example, Amtrak's high-speed train between Washington and Boston has become so competitive with shuttle flights that Delta Air Lines and US Airways recently launched advertising campaigns touting the superiority of aviation over rail. "They're giving us free advertising and we'll take it," said Karina Van Veen, an Amtrak spokeswoman, who said Amtrak ridership is up 1.8 percent in the Northeast. Still, not all road warriors who converted to train travel in the aftermath of Sept. 11 have made the change permanent. Andrew Laperriere, of Alexandria, Va., prefers to fly to New York for monthly visits with clients on Wall Street, unless weather forecasters call for thunderstorms. The managing director for International Strategy & Investment Group Inc. reluctantly rode the train for several months when Ronald Reagan National airport in Washington was shut down in the aftermath of the attacks. But now that it is open again and planes are less full than they used to be, Laperriere said the travel experience is as convenient as it's ever been. "It seems like more flights are on time," he said. During the previous three summers, major airlines were concerned about clogged terminals, runways and skies. Carriers relieved this congestion somewhat by tinkering with flight schedules, boosting their reserve fleets and improving communications with air traffic controllers. Any remaining kinks in the system are likely to be masked this summer by the reduced capacity, industry officials said. Ray Neidl, a veteran airline analyst, summed up the outlook for air trav= el this summer in the following way: "Good for consumers. Bad for airlines." =20 ---------------------------------------------------------------------- Copyright 2002 AP