Air travel demand drops; Delta trims capacity for 2009

— -- Air travel demand was far lower in November than expected — enough to persuade Delta Air Lines dal to lock in 2009 capacity cuts of 6% to 8%.

The cratering of demand, suspected now for weeks, became starkly visible Monday evening when Continental Airlines cal reported sobering November results.

November passenger revenue for Continental's mainline flying grew 2% to 3%, below the 4% to 6% increase the carrier had been expecting, and way below the double-digit increases in passenger revenue Continental recorded in the summer months.

Other airlines don't provide monthly revenue guidance, but Continental's new numbers show they are losing their ability to fill seats without resorting to broader and deeper fare cuts.

Continental's disclosure was followed Tuesday morning by Delta's capacity cut announcement. Officials at Delta — now the world's largest airline with its recent acquisition of Northwest Airlines — had not clearly stated 2009 plans. Delta President Ed Bastian told analysts and investors at a conference in New York that the carriers' new plan for 2009 calls for a 3% to 5% reduction in international flying, and an 8% to 10% cut in domestic flying.

Other carriers also are reacting to falling demand:

•Discount king Southwest, luv which flies more domestic passengers and flights than any other carrier, won't grow its fleet in 2009 — a first in the 35-year-old carrier's history.

CEO Gary Kelly said Southwest's first-quarter capacity will be down 4% to 5%, which is slightly less than the 5% to 6% reduction Southwest officials previously had announced.

•United uaua is reconfiguring its international jets to reduce premium-class seats by 20% and add more seats in coach. That's a further indicator of softness in demand among business travelers, who typically buy premium-class tickets and drive airline profits.

•Continental treasurer Gerry Laderman said his carrier will retire 30 Boeing 737s in 2009 and add only 19 new planes, 18 of them new 737s. He added that the airline is seeing "softness" in demand for first- and business-class seats.

•JetBlue jblu now expects its 2009 capacity to remain unchanged or grow up to 2%, down from its previous forecast of 3% growth, treasurer Mark Powers said.