Airlines Face Financial Crisis; More Layoffs

"We are looking at an entirely new environment," says Marianne McInerney, executive director of the National Business Travel Association, or NBTA, in Virginia. "We are looking at travel that will take longer, cost more, and create much more frustration."

In McInerney's view, the psychological effects of the terror attacks may have an especially large impact on air passengers: "It will be months before people, when they get on a plane, are not sitting there thinking about the unfortunate events that happened on Tuesday."

An NBTA survey of corporate travel managers taken on Wednesday shows 35 percent recommending that their workers limit travel due to Tuesday's events, with another 36 percent evaluating travel on a case-by-case basis.

Bethune says he would also welcome government control or supervision of airline security measures.

"Certainly we would welcome such an attempt to increase the security and have it uniform throughout the United States," Bethune said Sunday. "Right now it's the responsibility of the airlines and it could be enhanced and I think, you know, broadened."

Mullin added, "I believe most of my colleagues in the industry favor the government taking over all of this." He also said the security "isn't just a cost situation," although such a change might relieve the airlines of some of the financial burden for security.

Lost Money: $1 Billion Per Day?

The financial impact of the horrifying tragedy could come to $10 billion, or up to $1 billion per day, according to the International Air Transport Association, an industry trade group representing 266 airlines.

At least 40 percent of the airlines' normal operating costs continued even with all their planes grounded, including wages for crews and workers, and just about every normal expense other than fuel and landing fees.

The airlines typically keep about 15 days' worth of cash reserves on hand. And while many of them figure to have resumed significant portions of their services during that time, the downtime could significantly eat into that tucked-away cash.

Then there are the potentially expensive settlements which may be paid out to the families of the victims by United Airlines and American Airlines, each of which had two of their planes hijacked on Tuesday.

One regional carrier, North Carolina-based Midway Airlines, has already folded since the attacks. On Wednesday, Midway announced it would close all operations due to the disaster.

"Following the recent terrorist attacks, demand for air transportation is expected to decline sharply," Midway said.

And Mexicana, the second-biggest carrier in Mexico, said the impact of the attacks on the number of its flights to the United States could create severe financial problems as well.'s Peter Dizikes contributed to this report.

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