Airlines Cut Fares Out of 16 Cities by 30%

Major airlines on Tuesday announced a weeklong 30% average discount for fares between 16 U.S. cities and the rest of the country and delayed an increase planned for Thursday.

Meanwhile, USAir said it will save $60 million over the next 12 months in wage reductions and productivity improvements from a new contract with the machinists union.

Continental Airlines, which is trying to attract passengers while it works to complete its bankruptcy reorganization, initiated the discounting.

Major airlines generally matched the cuts, which involve discounts between Oct. 12 and Oct. 19 for trips through Dec. 15. The fares require a seven-day advance purchase.

Dates around Thanksgiving--Nov. 24, 25, 29 and 30--are excluded from the sale.

Round trips between Los Angeles and New York would cost $338, down from $440, and Denver-San Francisco flights would go to $258 from $290. Some cuts are more than 30%, including Milwaukee-Miami, which drops to $278 round trip from $380.

American Airlines, the nation’s largest carrier, Delta Air Lines, Northwest Airlines, USAir and TWA adjusted their fares, and United Airlines said it would remain competitive.

Among the cities in the discounting are: Los Angeles; Aspen, Colo.; Austin, Tex.; Billings, Mont.; Columbus, Ohio; Denver; El Paso; Jacksonville, Fla.; Kalamazoo, Mich.; Milwaukee; Oklahoma City; Ontario; Orange County; San Antonio; Tri-Cities, Mich., and Tulsa, Okla.

The cuts come a day after many airlines announced a $10 to $30 fare increase for Thursday on all tickets. The increase, also initiated by Continental, was postponed until next Tuesday, after the sale ends.

Airline officials have been hoping for higher fares to help cope with higher costs and restore profitability. Many airlines have been negotiating lower labor costs, which make up about 35% of a typical airline’s budget.

USAir, which returned to its normal schedule Monday after a brief strike, said it will save $60 million annually from wage cuts and new work rules it negotiated with the machinists union.

Union members ratified the contract over the weekend.