The nation's largest airlines reported massive second-quarter losses on Wednesday, blaming their troubles on the high costs of labor and fuel and reduced spending by business travelers.

UAL Corp. posted a wider-than-expected loss, while AMR Corp., US Airways Group Inc. and America West Holdings Corp., managed to exceed Wall Street's modest expectations.

The industry slump is expected to continue for at least another quarter, analysts said, as carriers slash ticket prices to encourage air travel, thereby crimping profit margins.

``Air traffic is holding because of fare sales,'' said Ray Neidl, an airline analyst at ABN Amro Inc. ``The losses won't be as severe in the third quarter but the conditions will be pretty much the same - good traffic, weak yields.'' UAL Corp.

The parent company of United Airlines lost $292 million in the second quarter, its fourth money-losing quarter in a row after more than five years without one.

The second-quarter loss amounted to $5.50 a share, which exceeded the $4.73 consensus estimate by analysts surveyed by Thomson Financial/First Call. That compared with a profit of $336 million, or $3.08 a share, in the same period of 2000, before the airline hit severe turbulence with labor disruptions, the slowing economy and its ill-fated May 2000 proposal to acquire US Airways for $4.3 billion.

UAL shares were down 74 cents a share Wednesday afternoon at $35 on the New York Stock Exchange, down more than 40 percent from its 52-week high.

Revenue slumped 9 percent to $4.66 billion from $5.11 billion a year earlier for Elk Grove Village, Ill.-based United, which was overtaken by American Airlines this year as world's largest carrier. Passenger revenues were nearly 12 percent lower, at $4.02 billion.

UAL's second-quarter loss will end up being as much as $116 million higher if the merger proposal fails within the next month, as is widely expected. The airline said it has deferred $66 million in merger-related costs and acknowledged it may have to pay a $50 million termination fee if the acquisition doesn't take place. Both charges would be reflected in second-quarter results if the proposal is settled by Aug. 14.

``We continue to feel the disproportionate effect of the weaker economy on business travel, particularly on the West Coast and Asia, two of our key regions,'' said UAL chairman and chief executive James Goodwin.

For the first six months of 2001, UAL lost $605 million, or $11.47 a share, compared with earnings of $237 million, or $1.68 a share, in the first half of 2000. Revenues declined 6 percent to $9.08 billion from $9.65 billion, including an 8 percent drop in passenger revenues.

The parent of American Airlines posted a net loss of $507 million in the second quarter and expects to report a loss for the full year.

The Fort Worth-based company's loss amounted to $3.29 per share, compared with a net profit of $321 million, or $1.96 per share, a year earlier.

Excluding one-time items, AMR said its second-quarter operating loss was $105 million, or 68 cents per share, compared to a profit of $285 million, or $1.75 per share, a year earlier. Analysts surveyed by Thomson Financial/First Call had expected a loss of 69 cents per share.

Revenue at American Airlines fell 5.2 percent to $3.97 billion from $4.19 billion a year earlier. AMR's overall revenue rose 11.4 percent, mostly due to the acquisition of Trans World Airlines Inc., to $5.58 billion from $5.01 billion.

The operating loss excluded a $29 million gain from a legal settlement and a $430 million charge to write down the value of some aircraft, AMR said.

``During the second quarter, we experienced a significant reduction in demand for business travel that severely eroded our revenue,'' said Don Carty, chairman and chief executive of the company that owns American, the world's largest carrier.

Carty said fuel prices added to the airline company's problems despite its effort to hedge costs by purchasing much of its fuel in advance at set prices.

Carty said the company expects a loss for the third quarter and all of 2001 if current conditions persist in the airline industry.

Carty said AMR has trimmed capacity in response to the decline in business travel, including retiring 22 aircraft by early next year, imposing a hiring freeze on management jobs, and deferring capital-spending projects.

AMR owns American, TWA and the American Eagle commuter line.

In trading Wednesday afternoon on the NYSE, AMR shares fell $1.07 to $35.33.

The parent company of US Airways lost $24 million in the second quarter, vexed by intensifying competition from low-cost carriers.

Still, the beleaguered airline, which was unable to complete its desired merger with United Airlines, outperformed the expectations of Wall Street. The loss of 36 cents a share was better than the 63-cent per-share loss predicted by analysts surveyed by Thomson Financial/First Call.

During the same period last year, US Airways had net income of $80 million, or $1.17 a share.

Company executives said a weak economy and pricing pressure from discount carriers like Southwest, AirTran and JetBlue have hurt the airline.

The carrier had revenues of $2.5 billion for the three months ending June 30, a 3 percent increase over revenues for the same period last year.

The company carried 16.6 million passengers in the quarter, a 3.4 percent increase from 2000. But revenue derived from passenger transportation declined 1.3 percent, from $2.21 billion in 2000 to $2.18 billion in 2001.

For the year, the company has lost $195 million, or $3.01 per share, on revenue of $4.7 billion. In the first six months of 2000, the company lost $138 million, or $2.07 a share, on revenue of $4.5 billion.

Shares of US Airways were up 41 cents to $17.13 in Wednesday afternoon trading on the NYSE.

The parent company of America West Airlines reported a net loss of $42.5 million, or $1.26 per share, for the three months ended June 30, saying its fuel costs rose by 10 percent.

A year earlier, the company reported earnings of $33.5 million, or 91 cents per share.

Excluding one-time charges, the company had an operating loss of $20.3 million, or 60 cents per share, which was narrower than the 73-cent-per-share loss expected by analysts surveyed by Thomson Financial/First Call.

Revenues for the second quarter declined to $587.2 million from $617.9 million last year.

Airline officials downplayed the Phoenix-based company's losses by emphasizing that they were carrying more passengers than a year ago and receiving less complaints from them.

For the first six months of the year, America West lost $55.3 million, or $1.64 a share, compared with a profit of $48.1 million, or $1.30 a share, a year ago. Six-month revenue was $1.17 billion versus $1.18 billion last year.

Shares of America West were unchanged on the NYSE at $10.19.