Southwest ticket sales drop after fatal accident

Southwest said a drop in travel bookings that followed its first passenger fatality could cost the carrier as much as $100m. The slide in ticket sales will drive revenue from each seat flown a mile, a gauge of pricing power, down by 1 to 3% in the current quarter, the discount carrier said Thursday. Southwest blamed as much as two percentage points of the decline on weak sales after an engine exploded in flight April 17, piercing the plane and killing a passenger. The sober outlook contrasted with those of rival airlines, which have predicted increases in the revenue gauge of as much as 5 percent. Southwest also faces pressures from aircraft retirements and fare battles with competitors. United Continental Holdings Inc. has been boosting seating capacity in some domestic markets where it faces off against Southwest. Southwest CEO Gary Kelly said the weak bookings were expected, partly because the airline halted marketing efforts after the accident. The airline set the value of the lost sales at $50m to $100m. “I don’t expect the softness to last very long,” he said. “We will be getting back to the market this week and we’ll be preparing for our normal booking campaigns.” Logan Purk, an analyst at Edward D. Jones, said weak pricing is a bigger concern.<br/>