Airlines Fasten Seatbelts for Bumpy Ride

Major US carriers downgrade as hard times loom
By Rob Quinn,  Newser Staff
Posted Mar 20, 2008 4:02 AM CDT
Delta Air Lines on Tuesday, Mar. 18, 2008 said it will offer voluntary severance payouts to roughly 30,000 employees, over half its work force, and cut domestic capacity by an extra 5%.   (AP Photo/Ted S. Warren, file)
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(Newser) – America's major airlines are getting ready for tougher times ahead, slashing jobs and cutting back operations. As the Christian Science Monitor reports, soaring fuel prices will inevitably lead to higher ticket prices, which will lead to less passengers—which, in turn, will force airlines to hike fares again to cover flying costs. "The party's over, particularly for leisure travelers," one industry analyst said.

The record-breaking price of fuel is certain to hit the industry hard, but optimists think the cutbacks could be good news for the airlines over the long haul, as it shows an ability to adapt fast that has eluded the sector in the past. Smaller airlines, especially those who lease planes to the biggies, could be the worst hit by a turbulent economy.