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Airlines struggle with outage
Hundreds of flights cancelled; many major airports remain closed; losses mount.
August 15, 2003: 3:02 PM EDT

NEW YORK (CNN/Money) - Major airlines struggled Friday to recover from the effects of the nation's largest blackout, but they said it would be some time before they can resume normal operations in the affected area stretching from Michigan to New York.

Virtually all major airlines saw some impact in cancelled flights, as three major hub airports -- New York's La Guardia and Kennedy airports, as well as Detroit International Airport -- had only sporadic power and flights through midday Friday. About 400 flights were expected to be cancelled Friday.

Airlines were saying they hoped to be able to resume normal operations at the affected airports by later Friday, but that it would take some time to accommodate all the affected passengers.

The outage hit during a busy summer travel season when the major airlines have all been reporting either record or near record percentage of their seats filled. Many of the carriers had also made cuts in their schedules and grounded aircraft in an attempt to stem losses, something that will make finding seats for affected passengers even more difficult.

"I'm aggravated, frustrated, tired. I need coffee, my feet hurt," Carlos Marolo, who drove to Chicago's O'Hare International Airport from blacked-out Detroit to try to catch a flight to the East Coast but could not find an empty seat, told Reuters.

Most of the airlines announced they were waiving the change fees for ticketed passengers who had to change travel plans due to the outage.

It is too early to estimate costs of the outage, said John Heimlich, managing director of economics for the Air Transport Association, the industry trade group, but the shutdown will affect a significant portion of nearly $200 million a day in passenger fare revenue for the carriers.

One industry expert said the cost to the airlines' bottom lines is likely to reach into the tens of millions of dollars once the dust settles, not a huge amount for the industry, but not a help considering the ongoing losses at many airlines.

"This is one more thing we needed like a hole in the head," said Heimlich.

Upstart carrier JetBlue Airways, one of the industry's few economic success stories, could see the greatest hit, since a large percentage of its flights is either to or from its hub at New York's Kennedy Airport.

The airline issued a statement saying that it was able to complete all but two of its 190 flights on Thursday, but that it had no choice but to begin widespread cancellations Friday. Its Web site listed 19 flights to and from JFK which had been cancelled at midday. Company officials could not be reached for comment on the economic costs of the outage. Its shares were down only 20 cents to $49 in mid-afternoon trading Friday, though.

Continental Airlines had two hubs -- at Newark Liberty Airport in New Jersey, just across from New York, and in Cleveland -- affected by the outage. But these airports had resumed operations by midday Friday. Northwest Airlines, with its hub in Detroit, was also significantly affected by the outage, although it said it was able to operate some of the Detroit flights due to an alternative power supply at its new terminal there.

Both Continental and Northwest shares were down a bit more than 2 percent in mid-afternoon trading, making them the weakest performers among major airline stocks.  Top of page


Reuters contributed to this report




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Most stock quote data provided by BATS. Market indices are shown in real time, except for the DJIA, which is delayed by two minutes. All times are ET. Disclaimer. Morningstar: © 2018 Morningstar, Inc. All Rights Reserved. Factset: FactSet Research Systems Inc. 2018. All rights reserved. Chicago Mercantile Association: Certain market data is the property of Chicago Mercantile Exchange Inc. and its licensors. All rights reserved. Dow Jones: The Dow Jones branded indices are proprietary to and are calculated, distributed and marketed by DJI Opco, a subsidiary of S&P Dow Jones Indices LLC and have been licensed for use to S&P Opco, LLC and CNN. Standard & Poor's and S&P are registered trademarks of Standard & Poor's Financial Services LLC and Dow Jones is a registered trademark of Dow Jones Trademark Holdings LLC. All content of the Dow Jones branded indices © S&P Dow Jones Indices LLC 2018 and/or its affiliates.