Orange alert may have airlines seeing red-analysts = = = = Thursday May 22, 4:46 PM EDT = CHICAGO, May 22 (Reuters) - The color orange may leave U.S. airlines seei= ng more red, as in ink, just as signs emerged of demand recovering after = the war in Iraq, analysts said. The U.S. government on Tuesday said it would raise its terror alert statu= s to "high" from "elevated" because of renewed risk of attacks in the Uni= ted States, which lifted the level to orange from yellow on the color-cod= ed scale. That could be more bad news for a cyclical industry that counts on summer= leisure travel and still suffers from the slow economy and the pneumonia= -like SARS virus, analysts said. "Airlines have indicated that forward bookings were strengthening, but th= at was before the current Orange alert," Blaylock & Partners airline anal= yst Ray Neidl said in a note, adding that airlines have little leverage t= o raise fares. = Traffic for the most recent week ended Sunday, before the alert, declined= on domestic and Latin American routes as well as on flights across the A= tlantic and Pacific, Neidl said. Last week's results were disappointing and could not be pinned on bad wea= ther or another outside factor, Credit Suisse First Boston analyst James = Higgins said in a note. Traffic was off 10 percent systemwide from a year= earlier, compared with a 9.8 percent decline a week earlier. "Furthermore, Tuesday's increase in the terror alert to orange cannot hel= p traffic trends in coming weeks," he said. Still, the intermediate term view on airline shares remains relatively fa= vorable, Higgins said. "Almost all that could go wrong ... has happened," Deutsche Bank Securiti= es analyst Susan Donofrio said in a note. The reactions came as the Air Transport Association, a lobbying group for= U.S. airlines, released unit revenue results for April to members. Unit = revenue is a key industry measure based on revenue generated for every se= at on a plane. Analysts said unit revenue for U.S. airlines fell more than expected at 4= =2E2 percent in April compared with a year earlier and fell 18.4 percent = compared with April 2000, before the downturn. March unit revenue fell 8.= 1 percent from a year ago. Unit revenue for trans-Pacific routes dropped 32.8 percent in April from = a year earlier as SARS, or Severe Acute Respiratory Syndrome, took an inc= reasing toll on travel. Unit revenue had dropped 19.5 percent in March fr= om a year earlier. For domestic routes, unit revenue declined 2.3 percent in April from a ye= ar earlier. Trans-Atlantic route unit revenue fell 5.8 percent, improved = from the March decline of 14.4 percent before and during the Iraq war. = =A92003 Reuters Limited. = Roger EWROPS