Low-Fare, Regional Airlines Threaten Traditional Carriers

WASHINGTON (AP) -- Airlines that offer low fares and provide service to smaller cities are chipping away at traditional large airlines like Delta, United and American, say the authors of an annual survey that ranks airline quality.

Five of the six top-rated airlines are low-fare carriers, and regional airlines are making it onto the list for the first time because they now carry enough passengers to qualify.

Delta Air Lines ranked 11th, with an Airline Quality Rating of -1.54 for 2004, a slip from -1.24 in 2003.

Brent Bowen, a co-author of the report and director of the University of Nebraska's aviation institute, said the traditional big airlines may just go away, leaving low-fare carriers and regional airlines.

''Five years ago, low-fare carriers had a 5 to 7 percent market share,'' said Dean Headley, the study's other author and an associate professor at Wichita State University. ''Today, the low-fare airlines have a 25 percent share.''

Low-fare carriers are succeeding because they have less complicated, more profitable route structures than the traditional airlines, Headley said. That makes it easier to keep customers satisfied, he said.

The Airline Quality Rating study, released Monday, is based on Transportation Department statistics for airlines that carry at least 1 percent of the 630 million passengers who flew domestically last year.

Five of the top six ranked airlines are low-fare carriers. JetBlue Airways was ranked as offering the best service, followed by AirTran Airways, Southwest Airlines, United Airlines, Alaska Airlines and America West Airlines.

Two regional carriers carried enough passengers to be ranked for the first time: Cincinnati-based Comair, a feeder airline owned by Delta, and SkyWest, headquartered in St. George, Utah. Atlantic Southeast, another Delta-owned feeder airline, made its debut on the list last year.

The regional carriers were ranked at the bottom of the list for quality, with American Eagle rated 13th, followed by SkyWest, Comair and Atlantic Southeast.

The study's authors said regional airlines have unique challenges. They're more likely to be late, for example, because they tend to fly into hub airports, which get backed up in bad weather.

David Stempler, president of the Air Travelers Association, said the quality of service makes little difference to airline customers.

''The only quality that passengers are concerned about is the quality of the low fares,'' Stempler said.

As a rule, airlines generally arrived later, lost more luggage and caused more consumer complaints in 2004 than they did the year before, the report found.

Only four of the 14 major airlines rated in both 2003 and 2004 were found to have improved - AirTran, Atlantic Southeast, JetBlue and United.

The study also found:

  • On-time performance worsened last year, with 78.3 percent of flights arriving on time, down from 82 percent in 2003.

  • Complaints about airline service rose 27 percent last year, a much higher increase than the 3.3 percent growth in passengers.

  • Last year, 4.83 bags were lost, stolen or damaged for every 1,000 passengers.

  • There was a small increase in the number of passengers ''bumped,'' or denied boarding for space - 0.87 passengers per 10,000 boardings in 2004, up from 0.86 per 10,000 in 2003.

The survey said Delta slipped in on-time arrival percentage (82.3 percent in 2003 and 76.2 percent in 2004) and mishandled baggage rate (3.84 vs. 5.17). The positives for Delta were a decrease in the rate of denied boardings (1.12 in 2004 and 1.30 in 2003) and only a slight increase in customer complaints (0.79 in 2004 from 0.78 in 2003).