America West stock falls

Tuesday, Jan. 8, 2002 | 10:43 a.m.

SUN STAFF AND WIRE SERVICES

America West Airlines Inc. and US Airways Group Inc. are among the U.S. carriers that may fail in the next two or three years following a decline in air travel, Barron's reported this week.

UAL Corp.'s United Airlines, which has cut capacity by an industry-leading 26 percent, also might fold, Barron's said. A slowing economy and high fares had reduced passenger numbers even before four U.S. jets were hijacked on Sept. 11.

Peter Walsh, director of aviation consulting at Mercer Management, told Barron's that the nation has enough passenger traffic to support five or six major airlines. Survivors may include American Airlines and Delta Air Lines Inc. -- which have stronger balance sheets than UAL -- and Southwest Airlines Co., which has lower costs, Barron's said

Southwest is the No. 1 carrier of gamblers and tourists to Las Vegas.

The U.S. government's aid package of more than $5 billion in cash and $10 billion in possible loan pledges may delay the demise of some carriers by a year or so, Barron's said. Walsh, though, said the industry needs $20 billion to $30 billion in capital to get back to its pre-Sept. 11 position.

The stock of America West, the No. 2 carrier in Las Vegas, fell 31 cents to $3.70 on the Barron's report.

Separately, America West said that beginning Jan. 16, customers purchasing electronic tickets will have additional payment options and customers who elect to have paper tickets, when the travel itinerary qualifies for electronic ticketing, will be charged a $10 fee.

And the airline said its corporate awards program, which gives airfare discounts to small businesses, added Dollar Rent-A-Car and Thrifty Car Rental as partners.

The Las Vegas Sun and Bloomberg News contributed to this report.