Tue, Jan 04, 2005
Airline To Cut Fares, Fees In Hopes Of Staving Off
How do you stay out of bankruptcy
court? Delta Airlines has an answer: cut prices and thereby cut
profits. It's a gutsy move aimed at making Delta more competitive
in the marketplace and it's just about to get underway, according
to Time Magazine.
Delta, still smarting from the failure of a dispatch computer
that grounded all of subsidiary Comair's 1,100 flights on Christmas
Day, will cut fares, eliminate restrictions and perhaps even cut
fees in an attempt to win more customers.
The nation's number three airline
has been working on the plan since last summer. In August, it
rolled out a prototype scheme in Cincinnati -- Comair's hub --
offering domestic coach tickets to anywhere in the continental
United States for no more than $499. First class tickets were going
for no more than $599.
"Delta's success in the current aviation marketplace will depend
on our ability to provide both good value and a good flying
experience," said CEO Gerald Grinstein back in August.
Some industry-watchers think Delta is trying to emulate the
LCC's -- low-cost carriers that have survived the slump that began
with 9/11 and have even profited while legacy carriers posted huge
losses and some, like US Airways and United, went bankrupt.
To that end, Delta is overhauling its route system and
rethinking its Atlanta hub, in hopes of making more seats available
while reducing congestion.
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