Thursday, September 25, 2008

U.S. Airlines Grounding 500+ Planes This Fall
Posted by Scott McCartney


JP Morgan tallied up all the U.S. aircraft on their way to the desert, to Russia or the Third World this fall, and it’s a rather staggering number. All told, U.S. airlines are grounding 512 airplanes. That happens to be the same number of passenger jets in Northwest Airlines Corp.’s entire fleet.
In essence, airlines are taking a carrier the size of Northwest out of the skies.


They are grounding about 10%-12% of U.S. capacity, which means fewer flight choices and higher fares for travelers. With the slow economy, there’s less demand for air travel. And continued high fuel prices mean carriers have to raise ticket prices to earn profits. But higher prices mean even less demand for tickets, so the only way for airlines to sustain those prices is to take seats off the market and ground planes.

At the end of 2007, U.S. airlines had 3,972 mainline jets in their fleets and 2,836 regional jets and turboprops, according to the Air Transport Association. The grounding of 281 mainline jets takes 7% of the total out of the skies. Regional jets suffer a bigger loss, with 11.4% of those small jets being grounded; so far, only 2.5% of turboprops will be retired, at least among the airlines who have reported fleet plans.

The loss of regional jets may be something to celebrate if you’re among those travelers who dislike the cramped quarters of 50-seat jets. But the disappearance of those jets is concerning for small communities that rely on those planes for air service.

Here’s a breakdown of reductions by carrier, courtesy of JP Morgan:


  • Continental: 67 mainline jets (737-300s and 737-500s); 64 regional jets

  • Delta: 15-20 mainline jets; 100 regional jets

  • United: 100 mainline jets (94 737s and six 747s)

  • American: 40 mainline jets (30 MD80s, 10 A300s); 37 regional jets and 26 turboprops

  • Northwest: 47 mainline jets (14 757s/A320s and 33 DC-9s)

  • US Airways: 12 mainline jets

  • JetBlue: four regional jets

A tally of all the U.S. aircraft on their way to retirement this fall turns out to be a rather staggering number. All told, U.S. airlines are grounding 512 airplanes. That’s the same number of passenger jets in Northwest Airlines Corp.’s entire fleet.

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