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UCLA Transportation Symposium

UCLA Transportation Symposium. Lake Arrowhead, CA. State of Industry – 40% of the industry capacity is in or heading towards bankruptcy. Share of Industry In S&P Rating Capacity Bankruptcy? Southwest Airlines A 8.6% No Alaska Airlines BB- 2.6% No JetBlue Airways Corp. BB- 2.1% No

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UCLA Transportation Symposium

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  1. UCLA Transportation Symposium Lake Arrowhead, CA

  2. State of Industry– 40% of the industry capacityis in or heading towards bankruptcy Share of Industry InS&P RatingCapacityBankruptcy? Southwest Airlines A 8.6% No Alaska Airlines BB- 2.6% No JetBlue Airways Corp. BB- 2.1% No Northwest Airlines Corp. B 10.4% No Continental Airlines B 9.9% No AirTran Holdings Inc. B- 1.3% No America West Holding Corp. B- 3.5% No AMR Corp. B- 20.2% No Delta Air Lines Inc. CCC 15.2% Likely US Airways Group Inc. CCC 6.2% Yes ATA Holdings Corp. CCC 2.4% Likely UAL Corp. D 16.6% Yes Frontier Airlines Inc. N/A 1.0% No S&P rating is the Corporate credit rating as of July 31, 2004; Capacity based on Q2 ‘04

  3. 140,000 Employees have been furloughed Airlines in Turmoil:AMR to Reduce Pilot Force by 20% UAL Will Lay Off 1,500 WorkersAs Part of Cost-Cutting Industry Recap Post 9/11 • 800 Aircraft have been parked

  4. Industry Net Losses $ (billions) Source: Merrill Lynch - August 30, 2004. Data for major airlines only, excluding government compensation

  5. Low Cost Carriers’ Share of Passengers Source: U.S. DOT DB1A database. LCC’s include: AirTran, Frontier, JetBlue and Southwest. Majors includes: Alaska, American, America West, Continental, Delta, Northwest, United and US Airways. * Merrill Lynch Research forecast

  6. And how do we surviven when -

  7. ?

  8. It’s all about having an edge - A point of differentiation

  9. Airport of the Future

  10. Alaska Operations Initiatives Juneau, Alaska

  11. Mixed Fleet Seats

  12. Air CargoPost 9/11

  13. Clawing for Customers • Loss of walk-up customers. • Changes in security measures. • Irresponsible pricing. • Shift to Ground Transportation. • C0ntrol Cost.

  14. 737-200 Combi Replacement

  15. 737-400 Combi Configuration Fixed Bulkheads Moveable Ballast Storage Cargo Door 70 Passenger Seats 4 Cargo Igloos 30% more cargo capacity 15-20% more passengers

  16. 1999 2000 2001 2003 2004 Maintaining your competitive edge.

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