"Our basic policy is to choose the cheapest option and this won't change," said Akiko Yamaguchi, a spokeswoman for Sony Corp, the second-largest consumer electronics maker.
Fares "are becoming cheaper than before," said Junko Yoshida, a spokeswoman for H.I.S. Co, one of Japan's biggest travel agents. She said an increase in honeymooners and other travelers flying in more expensive seats is helping boost demand.
Downside Savings from travel budget cuts have a cost of their own.
Flying economy class "takes its toll on the body," Compaq's Chan said. "If you're a fat person, even getting in there will be tough." Businessmen complain economy cabins cause fatigue, with cramped conditions and a lack of privacy hindering work en route.
For the airlines themselves, the drop in demand for seats at the front of the plane means profit is falling faster than implied by overall passenger figures, analysts said.
Cathay filled 75 percent of available seats in June, a drop of 2.3 percentage points compared with a year earlier. Asia's sixth-biggest by sales will probably report net income of HK$3.86 billion (US$495 million) for 2001, down 23 percent on 2000, according to an IBES International Inc. survey of 29 analysts.
"Passenger demand is showing signs of weakness, particularly for first and business class travel," said Ian Shiu, Cathay's general manager network revenue, in a statement.
Time to Buy? Singapore Air filled 68.5 percent of its seats in May, down 2.1 points on the same month a year earlier. Asia's most profitable carrier is on course to report a 29 percent drop in net income for the year to March, according to IBES.
HSBC's Webb says investors have taken much of the drop in demand into account, although signs of a recovery may be months away. The Bloomberg Asia Pacific Airlines index of the stocks of Asia's 10 biggest airlines has fallen 25 percent this year.
"The sector is going to bottom in the third or fourth quarter, and that will be the time to buy" airline stocks, Webb said.
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