Congress may offer help to airlines

With three of its four biggest companies in bankruptcy after record-high fuel prices, the U.S. airline industry may get help from Congress, senators said.

"I don't think we should ignore any option," Sen. John McCain, R-Ariz., said yesterday in Washington, D.C. "The airlines have been in crises in the past, but I'm not sure I have seen anything quite approaching this."

Delta Air Lines and Northwest Airlines, the No. 3 and 4 U.S. carriers, filed for bankruptcy protection yesterday. United Airlines, the second-largest airline, is already operating in Chapter 11.

Through their trade group, airlines are seeking a one-year suspension of a 4.3-cents-a-gallon fuel tax, saving the industry $600 million.

Sen. Ted Stevens, R-Alaska, chairman of the Senate Commerce, Science and Transportation Committee, asked them to get their requests in for possible inclusion in disaster-recovery legislation that may "move pretty quickly" next week. "Let us know if there's anything we can do to help you get through this period," Stevens said.

The airlines' Washington, D.C., trade group, the Air Transport Association, described its aid request at a hearing of the committee's aviation panel.

Jet-fuel prices have increased 239 percent over four years, and airlines will pay $9.2 billion more for fuel this year than last year, said James May, the group's president.

"Just when you think it can't get any worse, it does," he said.

With Delta's and Northwest's filings, May said, 47 percent of U.S. seat capacity is held by carriers in Chapter 11. Capacity is based on the number of available seats.

Congress may give carriers the fuel-tax break and more time to pay pensions, said James Corridore, an equity analyst at Standard & Poor's in New York.

"A major bailout like we saw after 9/11, I don't think that that's in the offing," said Corridore. "I don't think the Bush administration is looking on that very favorably."

The fuel-tax break is one of three aid requests from major carriers.

They also want Congress to suspend the 7.5 percent ticket tax on a portion of airfares they call "fuel surcharges" that help pay energy costs.

Carriers also asked the Transportation Department to let them separate the surcharges from fares in advertisements and instead disclose those costs in fine print.

Transportation Secretary Norman Mineta said in a letter to May yesterday that he plans to begin the process to consider the advertising request.

He will also consider completely rescinding agency regulation of airfare advertising, he said.

"We are placing the project on a fast track," Mineta told the trade-group president.