Icahn’s LV ticketing company cutting jobs due to TWA ruling

Kevin Ferguson

Friday, March 16, 2001 | 12:16 p.m.

Lowestfare.com plans to slash its staff by one-third, recently issuing 60-day pink slip notices to about 335 employees resulting from the company's loss of a lucrative contract with Trans World Airlines, a corporate executive said.

The Las Vegas-based Internet travel-booking company had relied on TWA for the bulk of its airline ticket inventory. The termination of the contract stems from American Airlines' pending acquisition of TWA, which was recently approved by a bankruptcy judge.

Carl Icahn, owner of Las Vegas-based Lowestfare, tried unsuccessfully to buy TWA. His bid of $1.1 billion was higher than American's, but came in too late.

David Lovely, Lowestfare' senior director of marketing, said the layoffs were issued in a variety of deparments, but declined to cite specifics. He did say, however, they will occur in Las Vegas, Los Angeles and Kent, Wash.

He declined to comment on the company's business strategy, referring those questions to Icahn. Icahn couldn't immediately be reached for comment.

One industry analyst said the termination of the TWA contract could be a sign of tough times for Lowestfare.

"It could significantly hurt Lowestfare because TWA (had supplied) them with the bulk of its airline tickets at a discounted rate. Lowestfare resold them at a profit," said Andrew Bartels, an analyst for Giga Information Group.

Lovely declined to say what percentage of Lowestfare's inventory was supplied by TWA.

The company's Internet site offers tickets also on America West, United, Northwest, Delta, Frontier and National airlines.

Lowestfare, formerly known as Global Discount Travel Services LLC, has agreements with more than 800 travel agents, airlines, resort companyies , car rental agencies and cruise lines. A year ago, it reported that it had 530 employees based in Las Vegas.

Lovely said Lowestfare has about 1,000 employees nationwide, including those that have been issued layoff notices.

Icahn stated in a court deposition that the company may try to link it with another airline he would acquire. That has led to speculation that Icahn may try to buy Las Vegas-based National Airlines, another troubled company which is operating under Chapter 11 bankruptcy protection.

A National Airlines spokesman said this week the company will not comment on the speculation, or make any announcement about investors until a deal is sealed.