Continental's February RASM Down Dramatically

I always look forward to the beginning of the month, because it's when Continental releases its monthly traffic report. As I've said before, I love Continental's releases because they give unit revenue estimates as well as just traffic so we have the whole picture. The news for February came out today, and folks, it ain't pretty.

Continental reported weak revenue and traffic numbers. System load factor was down 3.5 points year over year, but more startling is revenue. Unit revenue (revenue per available seat mile - see definitions) was down an estimated 11.5 to 12.5 percent for the month. Part of that was because fewer seats were filled, but part of that is also because those people on the planes were paying less. We knew the pain would start coming fast now, and here it is.

If there's any silver lining, it's in the final January numbers. A month ago, Continental said that it expected January RASM to be down 5 to 6 percent. It looks like it was down by a mere 4.8 percent. Sheesh. If I were an airline, I would certainly be battening down the hatches to try to weather this storm.