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More airlines eliminate commissions

United Airlines and US Airways on Thursday scrapped most commissions paid to travel agents in the United States and Canada, joining most of their industry rivals in the cost-cutting move.

Delta Air Lines began the change last week, and was quickly matched by American, Continental and Northwest airlines. American Trans Air also cut their commissions Thursday, while Vanguard Airlines Inc. said it would keep paying a 5 percent commission.

The changes announced by United, US Airways and American Trans Air take effect immediately and also cover tickets issued in Puerto Rico and the Virgin Islands. The airlines declined to comment beyond their brief statements.

Southwest Airlines, Alaska Airlines and America West Airlines are now the only major carriers that haven't eliminated the payouts.

The carriers are moving to sell more tickets through Internet sites, which reduces their costs. Higher expenses and lower revenue after the Sept. 11 attacks forced airlines to be more aggressive in cutting costs.

"It's one way to counteract some of the increased cost for security and insurance" following the attacks, said Reno Bianchi, a fixed-income analyst who covers airlines for Salomon Smith Barney.

United, the second-largest U.S. airline, paid $710-million in commissions last year, down 31 percent from 2000. US Airways, the No. 6 U.S. carrier, paid $279-million last year, a 25 percent decrease.

Travel agents, which sell about 70 percent of tickets, have opposed the string of commission cuts by airlines during the past seven years.

The agents have said they will charge higher fees to customers to make up for lost commission revenue.

Most agents began charging customers fees as the commissions dwindled in recent years.

Shares of United parent UAL Corp. fell 31 cents to $15.14, while US Airways Group rose 28 cents to $6. Amtran gained 34 cents to $14 and Vanguard rose 1 cent to 53 cents.

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