Low-Fare Carriers Dominate Top Spots in Airline Quality Rating; Jet Blue Is New No. 1

4/5/2004

From: Tim Kaldahl of the University of Nebraska at Omaha, 402-554-3502 or tkaldahl@mail.unomaha.edu, or Joe Kleinsasser of Wichita State University, 316-978-3013 or joe.kleinsasser@wichita.edu

WASHINGTON, April 5 -- Three of the top four performing airlines are low-fare carriers, according to the national Airline Quality Rating (AQR) study. The 14th annual study, ranking the 14 largest U.S. airlines, was announced today (April 5) at a news conference in Washington, D.C. Jet Blue debuted in the Airline Quality Rating as the No. 1 one ranked airline. Alaska was No. 2, and Southwest, America West and US Airways round out the top five.

The overall airline industry performed slightly better in 2003 than in 2002, thanks to a significant drop in customer complaints. Of the 10 carriers rated in both 2002 and 2003, only American Airlines and US Airways had a decline in their AQR scores. Airlines rated for the first time are Jet Blue, AirTran, ATA and Atlantic Southeast.

The AQR is a summary of month-by-month quality ratings for the largest domestic U.S. airlines operating during 2003. Co- researchers Brent Bowen, director and professor, University of Nebraska at Omaha (UNO) Aviation Institute/School of Public Administration and Dean Headley, associate professor of marketing at Wichita State University (WSU), used 15 elements important to consumers when judging the quality of airline service.

The rating is conducted annually by the UNO Aviation Institute and W. Frank Barton School of Business at WSU. The AQR, as an industry standard, provides consumers and industry watchers a means to compare quality among airlines using objective performance-based data. It is a cooperative research project funded as part of faculty research activities at UNO and WSU.

The AQR ranked the 14 largest airlines for 2003 as follows: 1) Jet Blue, 2) Alaska, 3) Southwest, 4) America West, 5) US Airways, 6) Northwest, 7) Continental, 8) AirTran, 9) United, 10) ATA, 11) American, 12) Delta, 13) American Eagle, and 14) Atlantic Southeast.

"The low-fare carriers are definitely solid in their ability to attract passengers, and it shows in the market share gains that they're making," said Headley. In 1991, low-fare carriers only had about 4 percent of the market share. Today, low-fare carriers have about 25 percent of market share. That number could climb to nearly 40 percent in the next few years.

"This year's AQR adds further evidence to the emerging performance gap between the legacy carriers and the no-frills network carriers," said Bowen.

Criteria included in the AQR are screened to meet two basic elements: They must be readily obtainable from published data sources for each airline, and they must be important to consumers regarding airline quality. The resulting criteria include areas such as baggage handling, customer complaints, denied boardings and on-time arrivals.

Other major industry findings in this year's research study include:

-- Overall airline quality improved for the third consecutive year.

-- Airline performance declined slightly in the areas of on- time arrivals, involuntary denied boardings and mishandled baggage.

-- Customer complaints in 2003 dropped by nearly 50 percent compared to 2002.

-- Northwest was the most improved airline in 2003.

-- The mishandled baggage rate for American Eagle was more than double the industry rate.

-- Jet Blue was easily the top-rated airline in fewest denied boardings, and second in on-time performance and fewest customer complaints.

MEDIA NOTE:

Headley will be available for interviews at the J.W. Marriott in Washington, D.C., by telephone following the news conference. Call 202-393-2000 today (Monday, April 5), or 316-978-3367 after April 6. Bowen also will be available for interviews via telephone following the news conference. Call 402-554-3424.

Kleinsasser and Kaldahl can assist in scheduling interviews. Kleinsasser will be available Monday, April 5, on his cell phone at 316-204-8266 or the J.W. Marriott at 202-393-2000. Kaldahl can be reached by cell phone at 402-672-0828.

To reach WSU on Monday, April 5, or Tuesday, April 6, call Amy Geiszler-Jones at 316-978-3409. To reach UNO April 5-6, call UNO University Affairs at 402-554-2358. Taped comments by Dean Headley are available via the WSU Radio Newsline at 316-978-3682 or http://www.wichita.edu/newsline now through Sunday, April 11. Taped comments by Brent Bowen are available on the UNO Radio News Line at http://www.unomaha.edu/uac/radionewsline/.

An online version of the full report's narrative is available at http://ai.unomaha.edu. Hard copies of the 2003 AQR report may be ordered by calling the WSU department of marketing and entrepreneurship at 316-978-3367.

A downloadable version of the news release and commentary is available at http://www.wichita.edu/aqr2004.

A CD-ROM with the history of the AQR is available on request. Call 402-554-3424 or 316-978-3367.