June 11, 2008

Last Wednesday, in response to record high fuel prices, United Airlines announced its low-fare airline, Ted, will cease operations, and the company will decommission 100 of its aircraft and cut 1,100 jobs. United's domestic mainline capacity will be reduced in the fourth quarter by 14 percent compared with the same period in 2007. The following day, Continental Airlines announced its own cuts: 67 airplanes, 3,000 employees and a capacity reduction of 16 percent below last year. (Continental will fly 831 daily domestic mainline flights in the third quarter of this year; the fourth quarter will see nearly 100 fewer flights.) Neither airline has revealed which routes will be reduced or eliminated, although Continental plans to announce this by week's end.