Greyhound Lines will halve its maximum one-way fare to $59 in a summer campaign to recapture passengers attracted to low-cost airlines, the nation's biggest bus company announced Wednesday.
Greyhound also announced that passengers who buy one-way tickets costing at least $25 may take a companion for $2 extra. The discounts go on sale Monday and require 30-day advance purchase, travel between Monday and Thursday and a $15 cancellation fee. They are good through Sept. 30.
"We're making every effort now to reintroduce people to the bus industry," said David Batchelor, president of New York-based Eastern Greyhound Lines, one of four regional subsidiaries the carrier has established in a major reorganization. The other units are based in Atlanta, Chicago and San Francisco.
Batchelor spoke at a news conference held to announce the nationwide discounts, the latest step in Greyhound's struggle to survive in an era when low-cost airlines such as People Express and Continental are making air travel affordable to millions of erstwhile bus riders.
Roger Rydell, a spokesman for Dallas-based Trailways Corp., the nation's second-largest bus company, said it had made no decisions on how to respond.
"The restrictions would tend to weigh us in the direction of not matching them," he said. "But we have to study them to see if they have the potential for hurting us."
Greyhound has suffered a 50% drop in annual passenger loads since the mid-1960s, when it carried more than 60 million people a year.
Last August, Greyhound announced that it would reduce its work force through firings and layoffs, discontinue an unspecified number of routes and close or relocate dozens of old terminals to help improve profits.
Under the maximum-fare discount, halved to $59 from $118, passengers can ride from New York to Los Angeles for $40 less than the cheapest coast-to-coast air fare, although the ride takes 80 hours. Flying takes about five hours.
Batchelor said the company expected most sales of the maximum fare to be purchased for shorter routes--from New England to the Southeast states, for example. He also said Greyhound expected stronger demand for the "Companion Money Saver" fare.
Under that discount, a couple traveling between New York and Washington could buy one ticket for the regular fare of $31 and get the second ticket for $2. The lowest air fare for two on the same trip is $58.
Expects Big Jump
Based on test marketing of the bargain fares, the company said it expected passenger traffic to increase by 19% this summer, historically the busiest season for the travel industry.
Financial analysts who follow Greyhound had mixed reactions to the announcement. Some said it would help the company recover passengers from the airlines, while others were more skeptical.
"It's not going to reverse the situation by any means; there's no way," said Katherine M. Stults, a transportation analyst at the New York brokerage firm Dean Witter Reynolds. "They won't take anybody off a transcontinental flight or anything like that."
Greyhound is a unit of Phoenix-based Greyhound Corp., a diversified company that also manufactures buses, runs financial services and makes consumer products ranging from Purex bleach to Dial soap.
Despite pressure from the airlines and the birth of more than 1,000 smaller bus companies since the industry was deregulated a few years ago, Greyhound remains the nation's largest bus carrier with a fleet of about 3,000 motor coaches and more than 12,000 destinations in the continental United States.