UPDATE 1-American Airlines pulls fares from Orbitz after deal falters

Tue Aug 26, 2014 4:00pm EDT

(Adds implications for other sites, Orbitz comment, share prices)

By Alwyn Scott

NEW YORK Aug 26 (Reuters) - The world's largest airline, American Airlines Group Inc, pulled its airfare listings from online travel sites operated by Orbitz Worldwide Inc on Tuesday because the companies failed to agree on terms for a new contract.

American said it also will pull US Airways flights starting Sept. 1, cutting thousands of routes and fares from orbitz.com and cheaptickets.com. The news initially sent Orbitz shares down 8.5 percent. In late afternoon trading in New York, the stock was at $8.00, down 5.1 percent. American shares were down 0.7 percent at $39.13.

American and Orbitz have clashed before over terms, and the latest dispute appeared unlikely to threaten rival online travel companies such as Priceline Group Inc, Travelocity and Expedia Inc, that continue to post American fares.

An American Airlines spokesman, Josh Freed, said the company reached agreements with some of these sites without a problem.

"In general, our strategy is to make our fares widely available," Freed said.

Orbitz declined to comment on the talks, but said its sites still carry fares from hundreds of airlines "eager to capture the revenue American is choosing to forego."

Both companies noted that Orbitz for Business, which serves business travelers, was not affected by American's move.

American said it was not able to reach a deal with Orbitz after negotiations that began before American and US Airways completed their merger last December, creating the world's largest airline.

Customers who bought tickets on orbitz.com or cheaptickets.com will be able to use the tickets for travel. But changes to the reservations must now be made through either the American or US Airways reservations departments, American said.

Other online travel sites felt little impact. In late New York trading, Expedia was down 0.4 percent at $87.44 and Priceline was up 0.2 percent at $1,279.57. (Reporting by Alwyn Scott; Editing by Grant McCool)

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