Airlines Lose A Decade To Fuel
Friday, June 6th, 2008All airlines can do is cut, cut, cut. There is just no money left after dealing with increasingly rising fuel costs to continue at current levels.
Houston-based Continental Airlines (nyse: CAL - news - people ) announced Thursday it would cut 3,000 jobs and reduce capacity by 11% because of record fuel costs that have pushed the industry into its worst crisis since Sept. 11, 2001. It also said its two top executives will forgo pay for the rest of the year.
Continental said it will begin pulling back on flights in September, when departures on its mainline operations will be 16.0% below the numbers of September 2007. For the year, capacity will fall 11%. The airline said it will cut domestic flights another 1% to 3% in 2009. The market liked the news though. Shares of Continental rose 4.8%, or 70 cents, to $15.20, by the close of trading on Thursday .
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