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Many Discount Airlines Survive Fallout From ValuJet Crash

May 26, 1996

PHILADELPHIA (AP) _ Just hours after a ValuJet plane nose-dived into the forbidding Everglades earlier this month, the idea of giving up frills for low fares suddenly lost its irresistible appeal.

But despite refund requests and at least one airline being forced to pull out of its most lucrative market, many discount carriers say they have survived the public relations fallout from the crash.

Following the May 11 crash, which killed all 110 people aboard the 27-year-old DC-9, some low-cost airlines suffered sudden drops in reservations as questions emerged about ValuJet’s safety record.

``Right or wrong, there seems to have been a bundling,″ said Tom Volz, vice president of marketing for Air South Inc., based in Columbia, S.C.

The International Airline Passengers Association in Dallas, which compiles records of fatal accidents, fleet age and other statistics, said it fielded 1,100 consumer inquiries about low-cost carriers’ safety the week after the crash.

Air South’s reservations only dropped less than 2 percent that week, but the airline handled at least 100 ticket refunds, compared to 20 in an average week, Volz said. The 2-year-old company serves several major East Coast cities with seven Boeing 737-200 jets averaging 18 years old.

Atlanta-based Nations Air, formed 16 months ago with a fleet of two jets, said reservations dropped 28 percent the day after the crash and plunged to 40 percent a few days later.

The company, which had averaged a low 53 percent occupancy before the crash, ended service along its Pittsburgh-Philadelphia-Boston route last week, blaming the sudden loss in revenue.

But most other airlines reported less severe results, while some low-fare companies with larger fleets and bigger service schedules reported little, if any, negative impact.

Spirit Airlines, which operates a fleet of 10 DC-9s from Detroit to cities including Philadelphia, Boston and Orlando, Fla., experienced a 20 percent drop in bookings the Monday after the crash. But Ned Homfeld, president of the Eastpointe, Mich.-based airline, said business returned to normal within days.

Kiwi International Air Lines and West Coast powerhouse Southwest Airlines Co. said it’s been business as usual since the crash.

Kiwi, which operates 15 jets, saw bookings increase 5 percent in the three days after the crash, said Rob Kulat, a spokesman for the Newark N.J.-based carrier.

Kiwi picked up business from ValuJet customers and sold tickets to 200 to 600 new daily walk-up customers after the crash, compared to virtually none on an average day, Kulat said.

Dallas-based Southwest, which entered the market 25 years ago as the nation’s first low-fare carrier and is now the nation’s fifth-largest airline, reported only a few safety inquiries.

Southwest’s established reputation, along with the fact that its fleet of 232 planes are an average of only 7.9 years old, is largely the reason it was able to avoid problems, said spokesman Ed Stewart.

Looking ahead, airline analyst Joe Shammas of Standard & Poor’s in New York said travelers who have avoided discount airlines will return.

``People are overall money conscious, and when their memories of this accident start to fade, they’ll go back to flying,″ Shammas said.

``The types of people who use discount airlines are people who, above and beyond, look at the price tag,″ he said.

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