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U.S. airlines less popular than the IRS - survey

Tue May 15, 2007 2:24am EDT

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NEW YORK, May 15 (Reuters) - Americans like the tax collector better than their airlines, according to a customer satisfaction survey released on Tuesday.

Weighed down by delays, grumpy employees and lost bags, U.S. airlines scored 63 out of a possible 100 on the University of Michigan's Customer Satisfaction Index. That is a touch below the 65 awarded to the bureaucracy-laden U.S. Internal Revenue Service.

The airlines' score -- down two points from last year -- was the lowest for the industry since 2001 and reflects growing dissatisfaction with the travel industry.

Hotels scored 71, falling four points to the lowest level since 2002, according to the survey.

The university's American Customer Satisfaction Index surveys about 20,000 people every quarter by telephone, focusing on different industries each time.

The airlines' long struggle to return to profitability after a prolonged slump following the attacks of Sept. 11, 2001 may have led them to cut costs and service too far.

"The process took so much out of them -- they may have cut beyond the bone," said Claes Fornell, director of the University of Michigan's National Quality Research Center.

The poor performance from U.S. airlines may make it easier for newcomers such as Virgin American and Skybus to win over customers.

"It opens the door for new competition and they will have an easier time capturing this market," said Fornell.

UAL Corp.'s (UAUA.O) United Airlines, which came out of bankruptcy last year, was at the bottom, falling 7 points to 56. Delta Air Lines Inc. (DAL.N), which emerged from bankruptcy on April 30, was close behind, falling 5 points to 59.

No-frills discount carrier Southwest Airlines Co. (LUV.N) led the industry with a score of 76, two points higher than the previous year.

While large companies in the airline sector scored poorer on the survey, big hotel companies fared a little better.

Marriott International Inc. (MAR.N), the top U.S. hotel operator, increased its score 2 points to 79, while smaller chains dragged down the industry's overall score.

((Reporting by Chris Reiter; editing by Andre Grenon; chris.reiter@reuters.com; Reuters Messaging: chris.reiter.reuters.com@reuters.net +1 646 223 6116)) Keywords: TRAVEL SATISFACTION/SURVEY

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