Competitors of paralyzed Eastern Airlines could easily absorb the surplus passenger traffic that would be created if the carrier disappeared permanently from the nation's skies, analysts believe.
"This is an industry that tends to be plagued by overcapacity," Edward Starkman, an airline analyst at PaineWebber Inc., said Wednesday.Eastern's rivals, most notably Delta Air Lines, Pan Am, United Airlines, American Airlines and USAir, have been operating with 62 percent to 63 percent of their seats full, analysts estimate.
That means that except for peak holiday travel times such as Easter weekend, the other carriers should have plenty of room for passengers who would have taken flights on Miami-based Eastern.
Archrival Delta, the nation's third-largest airline, is widely considered the hottest contender for the Eastern spoils. Like Eastern, Delta has a major hub at Atlanta, its headquarters city.
Eastern carried about 100,000 passengers a day on 1,040 flights before it was hit Saturday by a bruising Machinists union strike that was supported by pilots and flight attendants, leading to a virtual shutdown late Monday. Eastern, the seventh-largest airline, had 7 percent to 8 percent of the national market before the walkout.
On Wednesday, USAir announced it had reached an agreement with Eastern to buy all eight of the crippled carrier's airport gates at Philadelphia as well as the two routes from Philadelphia to Toronto and Montreal.
The agreements, which will cost USAir about $85 million, have been discussed for months as a way for Eastern to scrape up vitally needed cash. More Eastern gates, routes and possibly planes could be sold in coming months.
Airlines should be able to handle most of the Eastern spillover with their current schedules and by adding a few flights, said Robert Joedicke, who follows the industry for Shearson Lehman Hutton Inc.
"That's why (the Eastern situation) is not, in most people's eyes, a national emergency," he said.
Continental Airlines, which like Eastern is owned by Texas Air Corp., announced Wednesday it will begin operating daily non-stop flights from New York's LaGuardia Airport to Miami. Continental will fly four daily round trips on the coveted route, Eastern's main artery.
If Eastern disappeared, competitors' air fares wouldn't necessarily go up, analysts believe.
Eastern, a dominant force in the lucrative Florida market, was operating on some of the most competitive routes in the nation.
"They're still very competitive markets," Starkman said, suggesting that an Eastern collapse could even spark some battles to fill the void - which could mean lower fares in those areas.
In another competitive and profitable market, the Northeast shuttle service, Pan Am quickly jumped into the Eastern breach Monday by doubling its hourly shuttle flights to every half-hour at peak times.