American Cites First-Quarter Lag In Corporate Travel

American Airlines today, as it reported a first-quarter loss of $375 million, said revenue from corporate travel for the first three months of the year has lagged behind other passenger segments.

The carrier noted that mainline passenger revenue per available seat mile declined by 8.7 percent, while consolidated passenger revenues were down 17 percent for the first three months this year.

American CFO Tom Horton during a call with investors and media said, "Corporate account revenue continues to be challenged, with year-over-year revenue declines greater than the system average," though he did not specify the level of revenue declines for the corporate segment.

Still, American executives said the carrier is seeing some stabilization in demand. Horton noted, "For the moment, we're not seeing evidence of either improvement or further deterioration in the business."

President, chairman and CEO Gerard Arpey struck a more positive tone for the corporate traffic outlook in the second half of this year. "I think a lot of companies, if history is any indication, will not stay as hunkered down because travel is an integral part of their business, and so they need to have sales conferences, they need to go to conventions, they need to drum up business."

Arpey noted that corporate travel recovery hinges on broader economic health. "If the economy begins to pick up steam, which (Federal Reserve) chairman (Ben) Bernanke seems to think we're making some progress, that will bode well for traffic at the back half of this year," he said.

Meanwhile, Arpey in a memo to employees today said the carrier has "picked up some significant new corporate accounts in the last few months," despite the "slowing economy."