ATA Says U.S. Airline Industry Is In Serious Decline

Pointing to record-high fuel prices, the Air Transport Association says the U.S. airline industry is in "serious decline," and is losing its aviation leadership.

In an open letter posted on the smartskies' Web site, James C. May, the association's president and CEO, notes that as jet fuel prices have climbed 59 percent higher than last year, and the U.S. finds itself in a weakening economy, six airlines - MAXjet, Big Sky, Champion, Aloha, ATA Airlines and Skybus - have ceased operations or have announced their intention to do so since Christmas.  A seventh, Frontier, is attempting to continue operations under the protection of the bankruptcy court.

According to Mr. May, "We [the U.S.] are giving away our world leadership in aviation; that's how bad it is. U.S. airlines once provided 40 percent of all of the world's airline service. Today that's diminishing and the value of these companies and the services that they provide is a shadow of its former self. Six companies make up the bulk of the U.S. airline industry - and virtually all of the industry's passengers flying across the Atlantic. Today, however, the combined value of all six is exceeded by Lufthansa, just one of many competitors in transatlantic service."

There are a number of steps Mr. May thinks the U.S. government can take to offset these developments and their consequences - like enacting a sound national energy policy and refraining from imposing new taxes on airline passengers.

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