Price Is Right at AMR

According to Eclat Consulting of Reston, Va., American's revenue per available seat mile improved by 8.5% in the first three quarters of 2004, while the average improvement for the six largest carriers was 4.1%. "American is managing its assets very effectively," said Gary Harig, Eclat's senior vice president. "Both load factor and unit revenue are going up faster than the industry average."

While United Airlines (UAUA) led American with an 8.7% RASM increase, its improvement seems to have resulted primarily from an 11% reduction in domestic capacity.

As for Delta, which showed a 0.1% RASM decline, its course has differed from American's since it introduced simplified fares. For one thing, Delta sought bankruptcy court protection in September. Also, its new fares included one-way caps, initially $499 for coach and $599 for first class, but both increased by $100 during the summer. American didn't cap its fares.

Delta spokeswoman Chris Kelly said fare simplification enabled Delta to "re-establish trust with the customer," adding that the airline "has had very positive results from customers." Financially, Kelly said, the fare simplification represented "a wash" for Delta, in which additional ticket sales compensated for the effect of lost revenue.

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