Western Air Cites Fare Wars in $13-Million Loss

Western Airlines, battered by rate-slashing fare wars, posted a $13-million loss for the second quarter.

Western’s loss for the three months ended June 30 compares to a profit of $31.7 million in the second quarter of 1985. The airline’s revenue for the most recent period was down 19% to $263.1 million from $323.6 million.

“The second-quarter loss was largely the result of continuing fare wars, which have substantially reduced industry yields (average revenue per passenger mile),” said Thomas J. Roeck, Western’s chief financial officer.

“Western’s Salt Lake City hub competes directly with service via Denver, scene of intense fare wars characterized by one competitor there as ‘suicidal,’ ” Roeck said.

Denver is the hub for Continental and Frontier airlines, the latter acquired last year by discount pioneer People Express, which decided to sell Frontier earlier this month to giant United Airlines.

Roeck also noted that 1985 results were inflated by a monthlong strike against United Airlines.

Second-quarter operating expenses were $301.3 million in 1986, compared to $323.4 million in 1985.