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Wed, Feb 11, 2009

Airlines Cut Back Once-Profitable International Routes

15,000 Fewer Seats Available Per Day Than March 2008

A year ago, the major US airlines talked of plans to cut capacity on rate-sensitive domestic routes, and expand their service on profitable international routes to improve their bottom lines. It looks the slumping global economy has forced them to change those plans.

USA Today reports demand for international trips is in free fall, and airlines in the US and elsewhere are now reducing the number of flights or using smaller jets on international routes to and from the US.

Official Airline Guide flight schedules analyzed by the paper indicate 466,000 fewer seats will be available next month compared to March of last year, or about 15,000 fewer per day. That represents a 5.3 percent drop from last year, and some individual airlines have cut a one-third of their seats to and from the US. 

International Air Transport Association economist Brian Pearce tracks 200 airlines, and says international passenger traffic in first-class or business-class dropped 9 percent in November on trans-Atlantic flights, and 17 percent on trans-Pacific routes. The timing appears to mirror the financial sector meltdown in the US.

"Businesses are cutting costs wherever they can, and business people are just not traveling," Pearce said. "There's no sign of this leveling off."

Simon Talling-Smith is British Airways' top executive for the Americas, and says the current slump looks to be longer and deeper than the one which followed the 9/11 attacks. "This is a much more global downturn than that one was," he said.

FMI: www.iata.aero

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