CONTINENTAL AIRLINES is to retire its fleet of 21 Airbus A300s in a bid to reduce capacity to 10% below 1994 levels by 1 March. The airline had previously announced the grounding of four Boeing 727s and three Boeing 747s in a move to improve financial performance.

The Houston, Texas-based airline hopes to save $150 million annually through capacity cuts and service reductions. Boeing 737s and McDonnell Douglas MD-80s will be used in place of the A300s. Continental's capacity grew by 10% in the fourth quarter of 1994, compared with the same period in 1993, but demand grew by less than 5%.

Source: Flight International