Orange alert may have airlines seeing red-analysts CHICAGO (Reuters) =97 The color orange may leave U.S. airlines seeing more= =20 red, as in ink, just as signs emerged of demand recovering after the war in= =20 Iraq, analysts said. The U.S. government on Tuesday said it would raise its= =20 terror alert status to "high" from "elevated" because of renewed risk of=20 attacks in the United States, which lifted the level to orange from yellow= =20 on the color-coded scale. That could be more bad news for a cyclical=20 industry that counts on summer leisure travel and still suffers from the=20 slow economy and the pneumonia-like SARS virus, analysts said. "Airlines=20 have indicated that forward bookings were strengthening, but that was=20 before the current Orange alert," Blaylock & Partners airline analyst Ray=20 Neidl said in a note, adding that airlines have little leverage to raise=20 fares. Traffic for the most recent week ended Sunday, before the alert,=20 declined on domestic and Latin American routes as well as on flights across= =20 the Atlantic and Pacific, Neidl said. Last week's results were=20 disappointing and could not be pinned on bad weather or another outside=20 factor, Credit Suisse First Boston analyst James Higgins said in a note.=20 Traffic was off 10% systemwide from a year earlier, compared with a 9.8%=20 decline a week earlier. "Furthermore, Tuesday's increase in the terror alert to orange cannot help= =20 traffic trends in coming weeks," he said. Still, the intermediate term view= =20 on airline shares remains relatively favorable, Higgins said. "Almost all=20 that could go wrong ... has happened," Deutsche Bank Securities analyst=20 Susan Donofrio said in a note. The reactions came as the Air Transport=20 Association, a lobbying group for U.S. airlines, released unit revenue=20 results for April to members. Unit revenue is a key industry measure based= =20 on revenue generated for every seat on a plane. Analysts said unit revenue= =20 for U.S. airlines fell more than expected at 4.2% in April compared with a= =20 year earlier and fell 18.4% compared with April 2000, before the downturn.= =20 March unit revenue fell 8.1% from a year ago. Unit revenue for=20 trans-Pacific routes dropped 32.8% in April from a year earlier as SARS, or= =20 Severe Acute Respiratory Syndrome, took an increasing toll on travel. Unit= =20 revenue had dropped 19.5% in March from a year earlier. For domestic=20 routes, unit revenue declined 2.3% in April from a year earlier.=20 Trans-Atlantic route unit revenue fell 5.8%, improved from the March=20 decline of 14.4% before and during the Iraq war. *************************************************** The owner of Roger's Trinbago Site/TnTisland.com Roj (Roger James) escape email mailto:ejames@xxxxxxxxx Trinbago site: www.tntisland.com Carib Brass Ctn site www.tntisland.com/caribbeanbrassconnection/ Steel Expressions www.mts.net/~ejames/se/ Mas Site: www.tntisland.com/tntrecords/mas2003/ Site of the Week: http://www.caribbeanfloral.com TnT Webdirectory: http://search.co.tt *********************************************************