Airlines cap fares ahead of Hurricane Maria

Major U.S. airlines said on Tuesday they would cap one-way airfares to aid evacuations out of Hurricane Maria's dangerous path, in the second such costly move in less than a month.

While fare caps can generate public goodwill, even brief flight cancellations and modest fare caps can have a negative financial effect of millions of dollars for airlines.

As the powerful Category 5 storm Maria churned over the Atlantic, wreaking havoc on tiny islands in the Caribbean, residents in its likely path looked to evacuate ahead of the storm's expected Wednesday arrival near or over the Virgin Islands and Puerto Rico.

U.S. Sen. Bill Nelson, D-Fla., wrote to airlines' chief executives urging them to implement price caps on fares for evacuees as they had done ahead of Hurricane Irma, another Category 5 storm that inundated parts of the Caribbean and Florida earlier this month.

The largest U.S. carriers put in place some level of fare cap on flights out of the area. But airlines still are recovering from an earlier rash of powerful storms that thrashed Texas, Louisiana, Florida and the Caribbean, damaging ports, halting service and costing hundreds of millions of dollars in lost revenue.

When Hurricane Harvey swept through Texas, dumping several feet of rain in the Houston area, United Airlines - which has one of the biggest operations in the area - is estimated to have absorbed a hit of upward of $265 million, according to an early projection by analyst Helane Becker of Cowen and Co. Smaller rival Spirit Airlines is forecast to have lost $11 million in the storm.

A second storm, the deadly Hurricane Irma, engulfed parts of the Caribbean and Florida, likely costing carrier Southwest Airlines some $40 million or more, in addition to the $40 million to $60 million blow caused by Harvey.

The exact financial impact of the trio of powerful storms is not yet known, but will likely register in the hundreds of millions, with negative effects to reverberate through at least the third quarter.