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Quick Hits: Trouble at 35,000 Feet


Brief scrutiny of today's headlines

Gone are the days when airlines prioritized customer satisfaction.

In the face of ever-increasing fuel costs, they're more concerned with self-sustainment. The key to success no longer lies in free peanuts and more legroom. Instead, commercial carriers have been forced to trim the fat and then some as a way to avoid bankruptcy.

Continental Airlines (CAL) is just the latest airline to announce cutbacks, saying Thursday it would shed 3,000 jobs and ground 67 planes, reducing its fleet by 11%.

This came on the heels of United Airlines' (UAUA) Wednesday announcement that it would cut 1,100 jobs, ground 70 planes and drop its coach-only service. As recently as today, the carrier informally proposed a program that would allow veteran employees to leave the company voluntarily in return for severance payments and travel benefits.

Delta Air Lines (DAL) and American Airlines (AMR) also announced plans to reduce flight capacity and eliminate jobs within the year.

But cost-cutting alone isn't enough to offset the $9.4 billion in revenue lost by airlines over the past year. To combat rising fuel costs, legacy carriers will also raise ticket prices and introduce new surcharges, such as fees for checking a second bag.

"There are going to be fewer flights since ticket prices will be significantly higher," Tim Winship, an editor of, told the New York Times."From a service and comfort standpoint, consumers won't be getting more for their money. If anything, less."

Soaring gas prices have already forced Americans to ration their road trips. Now air travel is becoming not just less affordable, but less available. The Air Transport Association expects that 2.7 million fewer Americans will fly this summer than last.

The rising price of crude is determined to put America on house arrest.

For more on flying high, check out Hoofy & Boo's always astute report:
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