FuelClub Discount

US Airways said it is canceling the leases on aircraft scheduled for delivery, charging for checked baggage, introducing a new in-flight beverage program and increasing fees associated with employee guest and parent travel programs.
“Our industry is profoundly challenged by the dramatic increase in fuel prices, and we must write a new playbook for running a profitable airline in this new and challenging environment,” Chairman and Chief Executive Doug Parker said in a news release.

The airline said jet fuel costs have nearly doubled in the past year, driving up annual energy expenses by $1.9 billion. The company reported a profit of $427 million last year. But fuel now accounts for 39% of total expenses; it was 14% in 2000.
Roughly 300 pilots, 400 flight attendants, 800 airport employees and 200 staff members will be eliminated from the company’s ranks, US Airways said.
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United Airlines, the second largest U.S. carrier, increased almost all domestic airfares by 3-5%, due to surging fuel costs, The Associated Press reported Friday.

It was the third increase in the past two weeks, The AP reported, for United (NYSE: UAUA), which like the U.S.’s other major carriers, is struggling to maintain a viable business model amid the largest increase in aviation fuel costs since the world’s second oil shock in 1979-80.

Shares of United fell 82 cents to $14.58 on the news in Friday afternoon trading.

United’s latest fare hike takes place just two days after Delta Air Lines (NYSE: DAL) CEO Richard Anderson said domestic carriers will need to raise tickets 15-20% just to break even at existing fuel prices, The AP reported.
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Fuel prices are the latest problem to hit the farming industry and one Welsh agricultural contractor warned yesterday that they could drive him out of business.

Tecwyn Hughes of Cleifiog Isaf, Llanynghenedl who works alongside his two sons has been contracting from his Anglesey home since 1952, but fears that he will have to quit because of massive rises in the price of red and white diesel.

Mr Hughes said: “In all my time in this industry, I have never faced a situation as dire as this. I feel as though contractors and farmers are being pushed over the edge as we simply cannot cope with the huge rise in the price of fuel.”
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Delta Air Lines has said it hopes to cut at least 2,000 jobs through a voluntary redundancy programme as it battles high fuel prices.
An estimated 30,000 non-pilot staff - about half of the firm’s employees- will be eligible for the payout.

The third largest US carrier also said it would cut 5% of its domestic services by August.

Delta said that its fuel costs had risen 20% over the past three months as oil prices hit record levels.

The firm wants to cut 1,300 rank and file jobs and 700 administrative and management posts.

There has been intense speculation that the firm was on the brink of a merger with rival Northwest Airlines, but analysts believe that this is now unlikely to happen in the near-term because of obstacles from pilots’ unions.

Airlines worldwide are suffering as a consumer slowdown in the US and Europe makes it more difficult to increase ticket prices at the same time as their fuel costs head higher on the surging oil price.

Fuel costs

“Our 2008 fuel bill is now expected to increase by nearly $900m (£450m) compared to our business plan and more than $2bn over 2007.”

The company’s existing budget for jet fuel is based on oil costing $90 a barrel.

Oil prices, which influence the cost of fuel, have remained strongly above $100 in recent weeks and Delta expects them to stay at this level.

The cooling US economy is also putting pressure on the business, it said in a filing with the Securities and Exchange Commission.

The airline said it would not cut back on its international schedule, “where fares more readily cover higher fuel costs”, pledging to expand its international routes by 15% this year.

Source: BBC