Northwest Lowers Air Fares; Other Carriers Follow Suit

Signaling continued weakness in airline travel, Northwest Airlines launched a fall fare sale Monday that other large U.S. carriers quickly matched.

Northwest, the fourth-largest U.S. carrier, said the cheaper fares to most destinations must be bought by Sept. 14 and are good for travel through Dec. 19, just short of the critical holiday traveling season. A 14-day advance purchase is required.

UAL Corp.’s United Airlines, AMR Corp.’s American Airlines and Delta Air Lines Inc., the three largest U.S. carriers, said shortly after Northwest’s news Monday that they were matching the fares.

Air fares have been under pressure throughout the year because of the economic slowdown and a drop in lucrative business travel. With a few notable exceptions such as low-fare carrier Southwest Airlines, the industry is on course to lose about $2 billion this year, according to estimates.

The fare cuts were another “bad sign” that demand is still soft, Goldman Sachs analyst Glenn Engel said.

Minneapolis-based Northwest, which also has hubs in Detroit and Memphis, said customers buying tickets through its Web site and Internet travel site Orbitz receive further discounts of as much as 5%.

US Airways Group also matched on parts of its network but not the transatlantic service.

This month, United eliminated the Saturday-night stay requirement for major business markets out of Chicago. Several carriers followed suit and also had Internet-only sales.

American said it also will offer 5% discounts if tickets are purchased through its Web site.

On the New York Stock Exchange, Delta fell 46 cents to close at $40.44, UAL fell 58 cents to $33.91 and AMR fell 33 cents to $33.53. Northwest rose 4 cents to $21.85 on Nasdaq.