Continental Airlines announces rising fares, warns of big losses

HOUSTON (AP) -- Faced with soaring fuel prices, Continental Airlines Inc. is warning of hefty losses this year and beyond -- plus possible employee furloughs and cuts to wages and benefits.
The carrier announced a worldwide fare increase Tuesday designed to help offset an additional $700 million in fuel charges the airline said it was facing this year because of surging crude oil prices.
As a result, Continental said it no longer expects to break even in 2004 and could have a significant loss for the year because of the rising fuel costs coupled with low fares. The company is also predicting losses in the quarter ending June 30.
Continental said it would increase its fares $10 each way for flights of less than 1,000 miles and $20 each way for those more than 1,000 miles.
The increases are effective immediately. The higher fares will offset 15 percent to 20 percent of its fuel costs.
In April, Houston-based Continental tried to raise a fuel surcharge that it adds to tickets from $20 to $30 per round trip for most travel within the United States and Canada. But it dropped the increase after rivals declined to match it.
Continental has about 41,000 employees, with hubs in Cleveland, Houston and Newark, N.J.