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USAir offers incentives to bring passengers back

Published Oct. 12, 2005

USAir is back in the air, using frequent flier bonuses and low fares for last-minute ticket buyers to lure back passengers it lost during a weeklong machinist union strike.

But while hundreds of flights were canceled and passengers inconvenienced during the walkout, USAir shouldn't have much trouble restoring its traffic to prestrike levels, airline industry analysts said.

USAir's leading position on many of its routes gives many passengers little choice but to use the country's sixth-largest airline.

The walkout by 8,300 mechanics and related workers shut down 40 percent of USAir's flights. Over the weekend, workers ratified an agreement reached by negotiators Thursday, and the airline said operations were back to normal Monday.

USAir offered a onetime 6,000-mile bonus to frequent fliers who use the airline through Friday and waived the advance-purchase requirement for its cheapest tickets Monday through Wednesday. The lowest fares still require a Saturday night stay, making them useful largely to leisure travelers.

American Airlines and Continental Airlines said Monday they would match the three-day fare promotion on routes where they compete with USAir. For American, the nation's largest airline, those routes are chiefly between the Northeast and Florida, spokesman Tim Smith said.

Meanwhile, major airlines plan to raise fares between $10 and $30 on all their routes Thursday, one month after a similar increase ended a summer of cut-rate airplane tickets, airline officials said Monday.

The latest increase would amount to about 5 percent and counters expectations that the sluggish economy would lead to a shortage of passengers during the typically slow winter months and another round of fare discounting.

USAir was studying the increase, spokesman David Shipley said Monday evening. Other airlines, including United, Delta, TWA and Northwest went along with the increase. America West matched it on routes where it competes with United and was studying the others, said spokeswoman Daphne Dicino.

"It's a realization that costs continue to exceed revenues.



. At some point you have to step up to that realization," said Smith of American, which plans to go along with the increase initiated by Continental.

One analyst liked USAir's promotion. "It's moderate and very disciplined as far as the marketplace goes," said Raymond Neidl, airline analyst at Furman Selz Inc. He said many of USAir's competitors were concerned that another fare war could break out as the carrier tried to rebuild its passenger base.

USAir is the dominant carrier at Tampa International Airport, with 85 jet and turbo-prop departures every day. Delta Air Lines has the second-highest number of flights, with 55 each day.

Airlines welcomed stranded USAir passengers during the strike and had hopes of making those fliers regular customers. But USAir is in a unique position as the leading carrier on many of its routes.

In Pittsburgh and Charlotte, N.C., USAir handles about 90 percent of all passengers. As of the end of last year, USAir boarded the most passengers at 11 of the 50 largest airports, including Baltimore-Washington International, Philadelphia and Washington National.

Some analysts said that the harm to USAir from the short strike was minimal and that the concessions should help the airline return to profitability.

"It was resolved in about a short a time as you could hope for," said Louis Marckesano, airline analyst at Roffman Miller Associates in Philadelphia. "USAir didn't get everything they would have liked, but getting anything from the machinists might be a victory in itself."

Union workers agreed to 3.5 percent wage cuts and benefit reductions. The company agreed to use machinists members to push airplanes back from gates, but would be allowed to use non-mechanics for the job, said USAir spokesman David H. Shipley.

_ Staff writer Bill Adair contributed to this report.