Continental Airlines Inc. expects to expand route capacity in both the domestic and international markets this year, President Jeff Smisek said Thursday.
Houston-based Continental expects overall capacity to rise about 8 percent, with domestic business expanding 4 percent, at a time when most big airlines are cutting U.S. capacity, Smisek said in a Webcast of an airline investor conference in New York sponsored by JP Morgan.
"A significant portion of our domestic growth is in response to incursion of low-cost carriers in our hub," Smisek said. "We will not let any of our competitors take our customers on price."
Continental shares rose 81 cents, or 3.5 percent, to $23.69 in midday trading on the New York Stock Exchange.
Other domestic expansion will include more connecting flights to international routes. By the end of 2006, 47 percent of Continental's business will be in international markets.
Continental is focusing on returning to sustained profitability, Smisek said. The key for airlines is to emphasize margins ahead of per-passenger revenue or costs.
Analysts are expecting 2006 earnings of $1.84 per share, up from a loss of $2.93 last year, according to Thomson Financial.
On Thursday Continental raised its expectation for liquidity at the end of the first quarter to a range of $1.8 billion to $1.9 billion to a range of $1.9 billion to $2 billion.
In answer to analysts questions, Smisek said a proposed rule change by the Department of Transportation that would give foreign owners more say in how U.S. airlines are run "is unlawful. We intend to challenge it in court." At the same time, he said, "we are not opposed in increasing access to foreign capital" for U.S. airlines.
News stories provided by third parties are not edited by "Site Publication" staff. For suggestions and comments, please click the Contact link at the bottom of this page.