American Wins 16 of 39 State Airline Pacts

More California state employees have begun flying in the red, white and blue planes of American Airlines, which has outbid Pacific Southwest Airlines to win 16 of 39 annual state airline contracts.

American Airlines will sell state agencies tickets for an estimated 84,700 one-way trips by employees flying on official business in the 12 months ending June 30, 1988. As one example, American, headquartered at Dallas/Fort Worth Airport, bid $49 a seat to take the Sacramento-to-Los Angeles route, with 37,000 trips a year, from PSA, which bid $60.

“American’s bid was below ours, in many cases substantially below ours,” said Bill Hastings, a spokesman for San Diego-based PSA, which was bought May 29 by USAir. Officials for American declined to comment.

PSA won seven routes, down from 21 last year, said Janel Hernandez, travel programs coordinator for the California Department of General Services, which awards the contracts. American had two state contracts last year, and AirCal, the Newport Beach-based carrier that merged with American on April 30, had none.

Other airlines winning state contracts were United Airlines, United Express and American Eagle.

PSA sold tickets worth “between $5 million and $10 million” to state government agencies last year, but expects to sell substantially less this year, Hastings said.

The General Services Department has accepted bids each of the last four years for all official flights by state employees, a spokeswoman said. Discounts on winning bids this year ranged from 2% to 50% of full fare and will total more than $8 million.

PSA successfully protested the initial award of the Sacramento-to-San Diego route, with a predicted 17,600 trips, to American, Hastings said, even though PSA’s price was higher.

American’s route required a change of planes in Los Angeles and travel time of more than three hours; PSA’s bid was for a 75-minute nonstop. American’s bid was $60 to PSA’s $78, Hernandez said.