Continental to Retire Planes, Cut Jobs

Updated from 2:55 p.m. EDT

Continental(CAL Quote) became the latest airline to announce cutbacks in its schedule, saying it will chop fourth-quarter domestic mainline capacity by 11%, resulting in about 3,000 job losses.

"The airline industry is in a crisis," said CEO Larry Kellner and President Jeff Smisek, in a letter to employees on Thursday. "Its business model doesn't work with the current price of fuel and the existing level of capacity in the marketplace. We need to make changes in response."

At current prices, Continental said it would pay $2.3 billion more for fuel this year than last year, or about $50,000 per employee. ...