Sun, Jan 23, 2005 - Page 10 News List

Pentagon to tap US airline industry

ASSISTANCE Struggling US air carriers will get a boost from the Pentagon, that is seeking the use of commercial airlines to transport military equipment and personnel

NY TIMES NEWS SERVICE , NEW YORK

At the slowest time of the year for the nation's struggling airlines, one big customer, the Pentagon, wants to give them more business.

According to a government memorandum circulated this week, the Pentagon has increased its spending by 15 percent so far this year on flights by passenger airlines, with the heaviest traffic expected in February and March.

The memo also said that the two dozen airlines, charter companies and cargo carriers that participate in a program, the Civil Reserve Air Fleet, may also be given the opportunity to fly goods and troops to countries in South Asia that were ravaged by the tsunami, supplementing a relief effort by the military.

The memo, dated Jan. 14, summarized a teleconference involving military officials and participants in the air fleet.

This year, the government is "buying at a pace about 15 percent above" what it was spending last year, according to the memo. It estimated spending of US$315 million on flights during the first quarter this year, compared with the US$275 million spent in the first quarter last year.

The memo gave no reason for the increase, but it coincides with the third rotation of troops to Iraq since the conflict began nearly two years ago. A spokesman at Scott Air Force Base in Illinois, where the program is based, had no immediate comment.

According to the memo, the Pentagon wants to contract with the airlines to fly 71,600 passengers in February and 75,300 in March. The transporting of passengers and equipment drops off significantly after that: In April, the air fleet is scheduled to carry 18,200 passengers, and 10,400 passengers in May. In addition, the commercial carriers are supplying one daily flight of 250 military personnel bound for rest and relaxation.

Under military regulations, the commercial carriers do not remain at the bases after landing but immediately depart after unloading. The airlines and cargo carriers supply flight crews.

During the initial deployment in Iraq in 2003, the air fleet program served as a lifeline to airlines as they struggled with a weak economy, the impact of the severe acute respiratory syndrome virus on air travel and the reluctance of travelers to fly.

The government paid US$636.2 million to 10 airlines that flew troops to the Middle East during the 131-day mobilization, and another US$574 million to 14 cargo carriers to deliver equipment.

All major passenger airlines have participated in the air fleet, although the amount of business each handles varies widely. ATA Airlines has received the most passenger business, while two charter carriers, Omni International and World Airways International, transport both troops and equipment.

ATA filed for bankruptcy protection in October and reached an agreement last month to sell some assets to Southwest Airlines. Even so, the airline said it planned to keep participating in the military program.

The Pentagon's plans for greater use of the air fleet coincide with efforts by the major airlines to reduce their flights inside the US and expand international flights. The carriers have been involved in a fare war at home, set off by Delta Air Lines' decision to cut ticket prices by 50 percent and place limits on what it charges for air fares.

In theory, that might limit the number of planes available to the air fleet, since the airlines might prefer to fill them with civilian passengers. But one person involved with the program at a major airline said he thought the government would be able to persuade carriers to bid.

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