Evening star., 1947-09-14

rate hike until they have divested
themselves of the last vestiges of
corporate by-windows.,
Airline officials, when speaking
privately, are the first to admit they
gathered an enormous amount of
excess weight in the lush days of
war contracts and the wild period
of postwar expansion when every
body who could buy a few surplus
transports rushed to get in on the
boom.
Caught Short
The reaction caught plenty of
short, forced many old
timers into the red and one of the
big four" to the verge of bank
ruptcy. 1t also ushered in a shake
down period, beginning about a
year ago, when the airlines started
to jettison excess baggage in the
shape of surplus vice presidents,
regional directors, town houses, sky
yachts, luxury suites, duplicating
jobs and costly procurement con-
tracts.
Part of the financial burden on
the airlines results from the fact
that they have doubled their fleet
since vi day. during a period OF
high prices. The number of planes
now in domestic and international
service on the certificated airlines
is 913, as compared with 440 two
years ago.
The 473 transports added to the
fleet include 354 four -engined air.
craft, each with more than twice
the seating capacity of twin-en-
gined types. There now are 18 times
as many four r-engined transports In
passenger service as was the case
at the end of the war.
Despite the fact that economic
pressure has forced several airlines,
including Capital and Trans World
to cancel contracts for future de-
livery of new planes, the industry
under present commitments will be
operating a combined fleet of some
1000 by the end of this year.
Back to Al Efficiency
Included in this number will be
scores of newly converted planes
devoted exclusively to moving cargo
and express, field in which the
scheduled carriers are expanding
rapidly.
Some carriers are moving in Sc
fast with new services and cut rates
that smaller, unscheduled lines ac-
cuse them of "cut-throat" tactics to
run them out of business.
Many staggering costs were forced
on the lines during and Immediately
after the war, when it took several
employees to do the work of one
trained man, and prices for con-
verting war equipment scared to
new attitudes. These fantastic
financial drains are now thing OF
the past, in the opinion of w. A
Patterson, president of United All
Lines.
MIR. Patterson told the writer a
few days ago his company is back
on the same efficiency level it hac
achieved in 1941 just before Pear
Harbor. A staff cut from boom
peak of 1890 to 1l,00O, as of Sep
tember /, is now operating a system
which has been extended since the
cut-back began.
No Secret Formula
Yet his company probably Will
lose 100000 during the first two
quarters, he said, and can scarcely
hope to break even during the re-
mainder of the year.
"I think the air transportation in
dustry will have to ask for at least
a 10 per cent passenger fare in
crease" Mr.. Patterson said. United
hasn't asked this as yet, but is seri-
ously considering it. And the other
fellows in the business are looking
at the same kind of financial state
ments."
With Pullman sleeper rates au'
thorized to go up from l to 40 pei
cent on october l, Mr.. Patterson
asked: why should the airline'
be expected to have some secret
formula to make a profit with rate:
on the prewar level? We dom
want to charge the public for oul
own inefficiency, but now that WI
have cut back to an efficiency basi'
we can ask for the increase witt
a clear conscience"
A 10 per cent increase, Mr.. Pat
,erson estimated, would put th'
present overall domestic rate OF
cents and a fraction a mile bacl
to approximately the prewar leVe!
The rates were cut to about a.
cents a mile in August of 1945 whe1
American Airlines made the recuc
ton and the larger carriers FOLLOWED
suit. They were raised back to tn
present level last spring at reques
of the leading carriers.
Capital Cleaned House
Meanwhile, there are indication
the CAB may soon reopen the Who'll
question of passenger rates with
view to adjustments where opera
tions deemed efficient are unable t
make a reasonable return.
Typical of grim housecleaning
within the industry was that G
Capital Airlines-PCA, with heao
quarters in washington.
The line cut its losses in the las
quarter more than s2,00o,00o unde
the first quarter, from s2,30o,0oo t
something under 100000.
Jobs were consolidated or eilml
mated entirely, cutting the force 1
the year ending last June 1ror
7e6 to $40 Economics were en-