Regional Airlines Profit from Rivals' Fare Hikes

Beginning of article

CHICAGO (Bloomberg) -- Southwest Airlines, the biggest low-fare airline, and smaller carriers such as Frontier Airlines gained business last month after some passengers balked at fare increases by larger rivals.

Passenger traffic rose 15 percent in May at Southwest, the seventh-largest U.S. airline, while several smaller discount carriers even greater increases. That compares with declines at the three biggest carriers -- UAL's United Airlines, AMR's American Airlines and Delta Air Lines -- and a 1.4 percent increase industrywide. May's lower traffic led to profit warnings at UAL and US Airways Group.

Major airlines raised prices three times this year, …