June 4 (Bloomberg) -- U.S. airlines' on-time arrival rate improved in April, a month after they posted their worst March results since 1995, the Transportation Department reported.

About 77.7 percent of flights arrived within 15 minutes of the scheduled time, an increase from 75.7 percent a year earlier, the Washington-based agency said today on its Web site.

The improvement suggests the U.S. Federal Aviation Administration may be succeeding in limiting delays as the summer travel season picks up during June. Last year's delays were the second worst on record.

``As airlines keep reducing the number of flights due to the rising price of oil, this summer may not be as bad as many were predicting,'' David Stempler, president of the Air Travelers Association passenger advocacy group, said in an interview. ``Let's hope this is a sign that congestion will be eased.''

U.S. carriers have announced that they will offer fewer seats for sale as they seek to boost demand to help cope with a 73 percent jump in the price of jet fuel in the past year.

UAL Corp.'s United Airlines said today that its capacity would fall as much as 18 percent by the end of 2009, under a plan that includes grounding 70 planes and cutting as many as 1,100 jobs. AMR Corp.'s American Airlines and Delta Air Lines Inc. each plan capacity cuts of at least 11 percent.

Lowest, Highest Rates

In April, American, which canceled more than 3,300 flights to inspect and repair wiring, had a 65.3 percent on-time rate, the lowest of 19 U.S. carriers. Hawaiian Holdings Inc.'s Hawaiian Airlines had the highest rate, at 90.5 percent.

Hawaiian, with a drop of 4 percentage points, and Mesa Air Group Inc., down 2.6 points to 73.2 percent, were the only carriers whose on-time rates declined.

Airports in the New York area and Chicago had the highest percentages of late arrivals, with 43.9 percent at New York's LaGuardia, 31.3 percent at Newark, New Jersey's Liberty, 29.6 percent at Chicago's O'Hare and 27.7 percent at New York's Kennedy.

``We're still grappling with the New York area congestion, which accounts for nearly half of all delay minutes'' and less than one-eighth of flights, said Victoria Day, a spokeswoman for the Air Transport Association, a Washington-based trade group that includes the major airlines.

Salt Lake City was the least-congested airport in April, with 12.4 percent of flights arriving more than 15 minutes after their scheduled time, according to the Transportation Department.

Reports of mishandled baggage fell to 4.99 per 1,000 passengers from 6.34 a year earlier, the department said. Total consumer complaints declined to 1,113 from 1,248.

The rate of flight cancellations dropped to 1.7 percent, from 1.8 percent in April 2007.

To contact the reporter on this story: Greg Bensinger in New York at gbensinger1@bloomberg.net

Last Updated: June 4, 2008 15:12 EDT