Carrie Charney is flying from New York City to Portland, Oregon, next month for her granddaughter's barmitzvah, and then to Baltimore to visit her daughter. But Charney, a retired insurance claims processor who lives in Bardonia, New York, does not seem concerned about bankruptcy filings by Delta Air Lines and Northwest Airlines that could come this week.
With good reason: Charney has bought tickets on Continental Airlines, which is in relatively good financial shape.
"I wouldn't book a ticket on Northwest or Delta," she said, "even if I found a cheap ticket on one of those airlines."
Other air travelers say they, too, are steering clear of the two carriers in an effort to avoid disruptions.
But the next wave of bankruptcies is unlikely to affect airline customers immediately, not even as far out as the busy holiday travel period. Over the long term, it could push ticket prices higher, airline specialists said, but the affected carriers are expected to continue normal operations, and any disruptions will probably be insignificant.
"When it comes to airline bankruptcies, infrequent travelers tend to freak out," said Chris McGinnis, who edits The Ticket, a newsletter for Atlanta-based frequent travelers. "They think bankruptcy is liquidation. But that's not the case."
Still, airline analysts like Philip Baggaley, a senior airlines analyst at Standard and Poor's, say that if Delta and Northwest seek bankruptcy protection, about half of the passenger capacity in the US would be operating under Chapter 11. If nothing else, that phenomenon may have a psychological effect on fliers.
That sentiment is almost universally shared by airline specialists. Some even say that bankruptcy is the best thing that can happen to carriers such as Delta and Northwest.
"It's going to be good for the airline, because it will give it the chance to restructure. It's good for passengers, because ultimately the airline will be able to lower its cost structure and offer better service to passengers," said Joel Widzer, author of The Penny Pincher's Passport to Luxury Travel: The Art of Cultivating Preferred Customer Status.
The short-term effect on travelers will be minimal and hardly noticeable, analysts say. Over the long term, passengers could notice a difference in routes and schedules. Raymond Neidl, an airline analyst with Calyon Securities, said that although the bankrupt airlines would maintain their frequent-flier programs, he would expect to see some revamping of routes. Some passengers might have to reschedule as both airlines pare flights to cut expenses.
"This process may be accelerated with more substitution of regional jets for smaller and older mainline aircraft," he said.
Several industry watchers also suggest that as routes are cut, and planes fly with more passengers, air fares might begin to rise from their historic lows, but competition from low-fare carriers will help keep a lid on prices. The increases would be a welcome relief to the airlines, whose fuel bills have risen sharply this year.
The steepest fare increases could be seen for the busy holiday periods: Thanksgiving, Christmas and New Year's.
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