New Routes To Profit?

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The majors won't have these routes to themselves and may soon face competition for business they once had locked up. Low-cost airlines such as AirTran, JetBlue and Spirit are bidding for part of the $2 billion the Department of Defense spends annually to move personnel and equipment around the world. Traditionally, major passenger and cargo airlines have dominated that business, but they may soon find themselves in a bidding war with the lower-cost carriers.

And the biggest fight over international travel is yet to come. American, Continental, Northwest and United are vying for U.S. government approval to launch new daily service to China next spring. A round-trip full-fare ticket from New York City to Beijing runs about $11,000, making it one of the most profitable routes on the planet. Additional competition may lower the price a bit--just not too much, the airlines hope.