Higher Labor Costs, Pilot Shortages, and Union Struggles Add to Woes; Lower
Fuel Costs Among Few Favorable Trends
NEW YORK, Oct. 7 /PRNewswire/ -- Standard & Poor's equity analysts have
released the latest forecast for the airline industry, which has yet to
recover from deteriorating business fundamentals that have been further
weakened by passengers' fears and economic recession.
Standard & Poor's "Industry Survey for the Airline Industry" is produced
every six months by its senior equity analysts, who collectively cover more
than 1,200 U.S. stocks, among the largest U.S. equity research coverage counts
in the industry. Part of a series of industry studies by Standard & Poor's, a
leader in global financial research and investment analysis, Industry Surveys
keep a watchful eye on 51 U.S. industries, offering insights into trends and
conditions that affect leading companies' market performance.
Industry Survey for the Airline Industry looks at the issues affecting all
segments of the airline industry, including: air travel demand (business and
leisure), major, national, and regional carriers, marketing alliances,
technological advances, labor issues, and electronic reservations and
ticketing. It also points to implications for industry players like United
Airlines, which in 2001 posted the largest loss in airline history, Southwest
Airlines (NYSE: LUV), which was alone among the nine major carriers in posting
a profit in 2001, and US Airways, which filed for bankruptcy protection in
August 2002.
"The stresses that faced the airline industry after last September's
terrorist attacks -- especially the unprecedented shutdown of U.S. airspace
and passengers' lingering fears over security -- further weakened airlines
that were already experiencing problems due to a weakened economy and labor
troubles," says Jim Corridore, Standard & Poor's airline equity analyst and
author of the survey. "Meanwhile, the strongest carriers, like Southwest and
JetBlue, have taken the opportunity to gain at the expense of their weakened
competitors." he continues. Corridore concludes, "There has yet to be a
single positive indicator that shows when this prolonged downturn may end.
While we are hopeful that we are at the bottom, worsening traffic statistics
and yields keep us pessimistic on the overall industry outlook."
Standard & Poor's Industry Surveys provide a broad and fundamental
overview of each industry's structure, its recent performance, and an analysis
of trends that will influence it in the future. Each survey is organized into
the following sections: Current Environment, Industry Profile/Industry Trends,
How the Industry Operates, Key Industry Ratios and Statistics, How to Analyze
a Company, Industry References, Comparative Company Analysis, and a Glossary
of terms used in that industry. Both text and data are provided, as are
references to additional sources of industry information. Two surveys on each
industry are published each year.
Readers can purchase the Standard & Poor's Industry Survey for The Airline
Industry three ways: online at http://sandp.ecnext.com, by telephone from
Standard & Poor's Central Inquiry Department at 212-438-7760, or via e-mail
order sent to Central_Inquiry_Unit@standardandpoors.com. Members of the media
can request a copy from the communications contact listed at the end of this
release.
Standard & Poor's analytic services are performed as entirely separate
activities in order to preserve the independence of each analytic process.
All non-public information received during any analytic process, including
credit ratings, is held in confidence. Standard & Poor's analysts do not
disclose non-public information outside of their specific analytic areas.
Standard & Poor's is a leader in providing widely recognized financial
data, analytical research and investment and credit opinions to the global
capital markets. With more than 5,000 employees located in 18 countries,
Standard & Poor's is an integral part of the world's financial architecture.
Additional information is available at http://www.standardandpoors.com.
SOURCE Standard & Poor's
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Related links:
http://www.standardandpoors.com
http://sandp.ecnext.com
CONTACT:
Jim Corridore, Airline Analyst,
+1-212-438-9508, Jim_corridore@standardandpoors.com, or John
Piecuch, Manager of Communications, +1-212-438-1102,
John_Piecuch@standardandpoors.com, both of Standard & Poor's
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