- The Washington Times - Wednesday, October 3, 2001

NEW YORK (AP) Two of the nation's biggest airlines introduced discounts on business fares at a time when planes are flying half-empty nationwide.
The reduced fares being offered by United and Continental will mostly benefit small- and medium-sized businesses, as opposed to large corporations, which already were given even steeper discounts through individually negotiated contracts.
The new fares, which are similar to existing offerings from Northwest and Delta, do not require a Saturday-night stay, a condition often attached to cheaper leisure fares. Business travelers typically complete their trips on weekdays and pay more than leisure passengers.
The discounts are available for travel through Dec. 31.
Continental announced the fare change yesterday after United announced the discounted fares late Monday. Other carriers are expected to follow.
While fewer than 10 percent of passengers purchase business fares, those sales represent between 50 and 70 percent of the industry's revenues.
"They need revenues more than they need passengers," said Michael Boyd of the Boyd Group, a Denver-based aviation consulting company.
For leisure travelers, few significant fare cuts have been announced since the Sept. 11 terrorist attacks that plunged the struggling airline industry into an even deeper financial hole. Many carriers extended previous autumn discounts, but Mr. Boyd said budget-minded travelers should anticipate "waiting longer" before major airlines announce across-the-board fare cuts.
"We have not had the everything-must-go sale yet that we're expecting," said Terry Trippler, who tracks airline fares for OneTravel.com.
In fact, industry watchers said the average cost of flying between certain destinations has actually risen as lower-fare seats were eliminated when carriers cut capacity by 20 percent after the attacks.
Even with the capacity reductions, about 50 percent of seats on domestic flights remain unfilled, according to the Air Transport Association, an industry trade group.
United and Continental are offering discounts of up to 50 percent for business travelers who purchase tickets 21 days in advance, and 25 percent for those who book 10 days in advance.
A Northwest Airlines spokesman said yesterday the Eagan, Minn.-based carrier already offers similar discounts that are "either lower or less restrictive than what their new fares are."
"We introduced them 18 months ago," the spokesman said.
A Delta spokeswoman made the same point.

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