Continental hub: Cleveland





Daily departures

Domestic: 194

International: 8

Continental: 35

Continental Express: 124

Continental Connection: 43

Nonstop destinations served: 66

Domestic: 60

International: 6

The people of Continental

Airport agents: 894

Cargo agents: 32

Chelsea (food preparation): 134

Flight attendants: 468

Management and clerical: 158

Pilots 228

Technical operations: 282

TOTAL: 2,196

Does not include more than 1,000 employees at Continental's regional airline partners

Source: Continental Airlines

Updated at 5:27 p.m..

CLEVELAND -- Continental Airlines plans to lay off hundreds more employees, but Greater Cleveland must wait months to learn how many will lose their jobs here.

The Houston-based airline said Tuesday that it will eliminate 1,700 positions nationwide but hopes some will come through leaves of absence and other voluntary measures.

How many employees will be laid off - and where - will be determined by about Sept. 23, Chief Executive Lawrence Kellner said. Continental has almost 2,200 employees at Cleveland Hopkins International Airport, where it is the busiest carrier.

Continental announced the work force reductions as it released weak second-quarter results. Reports from Continental and other airlines showed that carriers continue to flounder as both business and leisure customers rein in travel in a sluggish economy.

Continental said it will increase domestic fees for checked bags by $5. The first checked bag will cost $20 and the second $30 for passengers who check luggage at the airport instead of online. The change took effect immediately for flights on or after Aug. 19.

United Airlines and US Airways also charge $20 for a first bag and $30 for a second. All three carriers discount baggage fees $5 if paid online.

Continental also added $5 to the fee for booking a reservation over the phone.

The airline said the new fees would yield about $100 million. It said other revenue-raising moves are coming.

The airline announced no new capacity cuts. It slashed flights and routes last year as fuel prices soared. Continental's capacity in Cleveland for the 2009 second quarter was down 23.3 percent from a year earlier, while traffic fell 21 percent. Airlines can cut capacity by flying fewer flights or using smaller planes.

Continental said it lost $213 million, or $1.72 a share, in the quarter ended June 30, compared with a loss of $5 million, or 5 cents a share, a year earlier. A swine flu scare last spring took a particular toll on Continental's flights to Mexico.

Excluding one-time charges, the loss was $169 million, or $1.36 per share. Analysts expected a loss of $1.35 per share excluding charges, according to a survey by Thomson Reuters.

The airline took $44 million in charges during the second quarter because of the falling value of its Boeing 737s. The write-down included $8 million for disposing of three 737-300s and a $4 million charge related to obsolete spare parts.

Revenue tumbled 22.7 percent, to $3.13 billion, nearly matching the $3.14 billion forecast by analysts.

Southwest Airlines, the No. 2 carrier at Hopkins, squeezed out a profit in the second quarter of $54 million, down from $321 million in the second quarter last year. While outperforming other carriers, Southwest said its total operating revenue was almost 9 percent lower than a year ago -- and it expects a steeper drop in the third quarter unless demand rebounds significantly.

Southwest Chief Executive Officer Gary Kelly called today's travel market "one of the worst revenue environments for the airlines" ever. Kelly said about 1,400 employees had decided to accept early buyout offers of cash and travel benefits.

United Airlines said Tuesday that it lost $323 million in the second quarter. United said it would reduce international capacity an additional 7 percent for the last four months of 2009.

Continental's job cuts, amounting to about 3.4 percent of its work force, are on top of plans to eliminate 500 reservations agents and to put 700 flight attendants on leave. The layoffs for most employee groups, but not management and clerical, will be determined by seniority

At Hopkins, airport Director Ricky Smith declined to comment about Continental's decision since it's too early to tell the effect on Cleveland.

Continental CEO Kellner said a key measurement of revenue in relation to capacity "appears to be bottoming out," but he added, "It is doing so at low levels, and we must take aggressive steps to increase revenue and reduce costs."

Industry analyst William Swelbar said capacity reductions by airlines have not allowed airlines to raise fares as they had hoped.

"At this point, revenue is declining at nearly twice the rate of traffic, meaning that even rock bottom fares are not energizing demand in this environment," he said. "This is a simple economic fact that makes the current construct of the U.S. airline industry hard to sustain over the medium term."