"Airlines' Fundamentals are Deteriorating"

So says S&P's Philip Baggaley, who also thinks the deal by American Airlines' parent to buy troubled TWA could pose big labor problems for the carrier

After soaring for most of 2000, the U.S. airline industry has hit some rough weather in recent months. And that's not just a figure of speech. A harsh winter, combined with rising labor and fuel costs -- and a deteriorating economic environment -- are striking at the major carriers' bottom lines.

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