May 22, 2008 3:08PM

The Future of Airlines

By Alexis Glick

Are the airlines in jeopardy? Will an airline or multiple airlines face bankruptcy risk this year? Are you angry about the American Airline news and having to pay $15 to check your luggage? Think it couldn’t get worse? Better yet, how much worse could it get?

A LOT UGLIER, ACCORDING TO MY GUESTS THIS MORNING!!!!!!

This morning on Money for Breakfast, Ray Neidl of Calyon Securities and David Gaspar, a former American Airlines director joined me to talk about what they think happens next. IT AIN’T PRETTY! Ray believes the airline industry will cut back service on 20% of its routes, at minimum!!! David thinks several airlines are at risk of bankruptcy if fuel prices don’t decline. (Check back for this interview later on!)

Alex Wilcox, one of the founders of Jet Blue and now CEO of Jetsuite, a private jet company, says more routes in regional areas will get cut. In his 20 years in the business this is most reminiscent of the late 80s and may be one of theworst periods in history for the airline industry.

Wilcox said oil is hitting the airlines hard. “Labor used to be the biggest single cost to airlines, airlines have really trimmed their labor forces but they can’t do anything about the price of oil except renewal their fleets and I think that’s what’s got to go on.”

He also expected things to get a little more crowded on board.

“I think you’re also going to start seeing a lot less room in coach, they’re going to start stuffing a lot more people into the airplanes, you’re going to see the depreciation of the value of your frequent flyer miles, upgrades will be harder to get, free tickets will be harder to get. I think you’re going to see smaller communities losing air service, and those that keep it are going to lose regional jets that they’re flying, which are fuel inefficient and seeing more turboprops.”

Click here to watch my interview with Alex Wilcox