Airline Business Traffic: Up or Down?

CHICAGO (TheStreet) -- When it comes to business traffic, United(UAUA Quote) says it is improving and Southwest(LUV Quote) says it is not.

That begs the question, who knows business traffic better?

"We've seen business traffic pick up considerably (following) the pressure we saw in the second quarter," said United CFO Kathryn Mikells, on an earnings conference call. "The declines in corporate trends have abated."

As far as the difference with Southwest's view, Mikells said: "Compare the stark contrast between these two carriers. We are heavily focused on business travelers (and) I don't think it would be unusual that you would see" a difference in perception by a low-cost carrier.

Last week, on the Southwest earnings call, CEO Gary Kelly declared, "We're not counting on a return of the business traveler anytime soon," adding, "There's certainly been a sharp drop in business travel and we're expecting that's going to continue."

But United President John Tague said United sees business and premium traffic coming off lows. "We are seeing progress, the indication that this has bottomed," he said. "Not only are we seeing progress since the spring, we're sort of seeing it sequentially month after month." United said. During the quarter, passenger revenue per available seat mile fell by 14.7%, representing a 2.5-point improvement over the 17.2% decline in the second quarter.

"The next big signal we're really looking for is how do corporate travel budgets get reset for 2010," Tague said. "If we don't see a continued steep improvement as we move through the next quarter or two, then we're going to have to reassess."