Struggling Airlines Plan to Cut Flights, Plane Sizes to Survive -BYLN- by Joshua Freed Associated Press

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Like most businesses, airlines want to grow. But during these difficult economic times, their survival depends on their ability to shrink, as they try to match how much they fly with the number of travelers willing to pay for a ticket.

Just like Detroit shutting factories rather than building more cars than people want to buy, airlines are reducing the number of available flights to avoid flying empty seats around the sky. That saves them money on fuel and labor costs. Airlines also hope it will tip the supply-and-demand equation back in their favor and allow them to raise fares.

What the industry calls capacity cuts began last year as oil prices spiked. At one point fuel amounted to 40 percent of an airlineAEs costs, said Morningstar equity analyst …