1st Quarter Worst Ever for U.S. Airlines, Report Says
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NEW YORK — nation’s major airlines suffered their largest losses in history during the first quarter of 1986.
According to Airline Economics Inc., a consulting firm based in Washington, the 30 largest carriers collectively had operating losses of $664 million in the January-March period. The worst previous quarter was the first quarter of 1983, when the same 30 airlines lost $656 million.
Lee R. Howard, a vice president of Airline Economics, said the major reason for this year’s dismal record was the fare wars waged by the airlines during the period. He said that while passenger traffic was up 11%, yields dropped 9%.
However, Airline Economics predicted that, for the entire year, the 30 airlines will match last year’s collective profit of $1.4 billion. That is mainly because they will pay between $3.5 billion and $4 billion less for fuel than they did in 1985, due to the collapse of oil prices.
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