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Aggressive private operating companies have lowered fares and offered special promotions that helped increase ridership to its highest level since 1947.
Northwest lowered fares in the United States and to Europe and Asia as much as 40percenttoto lure more passengers, a spokesman, Kurt Ebenhoch, said.
The company acknowledged, however, that first- quarter sales fell 11percentto to £1.8 billion as it lowered fares to lure customers after the war in Iraq.
The government had argued that American deliberately lowered fares and added capacity to drive a competitor out of the Dallas-Fort Worth market in the mid-1990's.
A report issued by the Transportation Department in October 2000 concluded that alliances have led to new passenger traffic and sharply lowered fares.
American and United lowered fares through Chicago this month to stimulate demand, and Delta Air Lines initiated a sale though Atlanta in June.
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We respond by lowering fares and bookings return to normal, but at lower prices".
First, technologies that reduce weight and therefore fuel consumption should help to lower fares further.
Low-fare competitors like Southwest Airlines and JetBlue are expanding in the region, putting pressure on big carriers to lower fares.
"We can expand our business by lowering fares and any additional profitability means we can grow our business".
"We've got a lot of experience over 37 years of lowering fares and stimulating demand," Mr. Kelly said.
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