Roanoke Times
                 Copyright (c) 1995, Landmark Communications, Inc.

DATE: FRIDAY, February 11, 1994                   TAG: 9402110137
SECTION: BUSINESS                    PAGE: A-7   EDITION: METRO 
SOURCE: The Washington Post
DATELINE: WASHINGTON                                LENGTH: Medium

AIRLINES MAY SEE BLACK INK SOON

Nonetheless, the improvement, coupled with signs that the economy is strengthening, could turn 1994 into a year of modest profits after four years of losses totaling more than $12 billion, industry analysts say.

With one major company yet to report, the country's 10 biggest passenger-carrying airlines reported losses of just under $1.5 billion in 1993, according to company reports and figures compiled by the Air Transport Association. After subtracting a $600 million accounting change by Delta Air Lines Inc., the loss figure drops under $1 billion.

Taking into account just operating costs, the industry was $1.3 billion in the black for 1993, a $3.9 billion swing from the $2.6 billion in losses on operations in 1992.

"After enormous losses in 1992 and continuing losses in 1993, 1994 holds out the promise of real take-it-to-the-bank profits," said ATA chief economist David Swierenga, who said he is comfortable with forecasts by Wall Street analysts calling for a $1 billion profit this year.

A big unknown, however, is the impact that major expansions by low-fare carriers such as Southwest Airlines Co. and Continental Airlines Inc. will have. Both airlines are increasing their low-fare service in the Eastern United States.

If the projected profits of 1994 do materialize, industry experts say they will do little to put most airlines back into the position they need to reach to start ordering the new aircraft many of them need.

Only two airlines - America West Airlines and perennial profit-maker Southwest - were in the black last year. Two others - Alaska Airlines and United - were close. American Airlines Inc. also might have crept into the profit column except for a strike by its flight attendants just before Thanksgiving.

One factor helping all airlines was a decline in the cost of jet fuel. The average cost in 1993 was 60 cents a gallon, compared with 63 cents in 1992, for an industrywide savings of about $450 million.

Overall passenger traffic figures for the year show only modest increases, with domestic traffic flat compared with 1992 and international traffic up about 4 percent.

Domestic fares were up about 7.4 percent from 1992, but Swierenga noted that 1993 fares are being compared with the lower ticket prices resulting from the big 1992 fare war, which saw fares plummet by as much as 50 percent.