FORNARO AIMS TO STEER AIRTRAN INTO BLUER SKIES: NEW PRESIDENT TAKES ON AIRLINE BURDENED WITH LOSSES AND FACING FIGHT FOR SHARE

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Robert fornaro wouldn't mind if AirTran Airways became the next Southwest. "The up-and-comers historically haven't been very successful," he said. "The one exception is Southwest."

But transforming AirTran from a lesser-known entity to a respected, low-price carrier may be an uphill battle. As its new president, Mr. Fornaro, 46, joins an airline saddled with losses and battling a market share war at the country's busiest airport, Atlanta's Hartsfield International Airport.

Figures from Salomon Smith Barney show AirTran had pre-tax losses of $120 million in 1997 and $13 million in 1998. This year, Salomon projects a loss of $16 million. Yet, Mr. Fornaro is undaunted by the challenge to turn AirTran around.

"I think the company has a very good opportunity to be one of the few survivors," he said.

Earlier this month, AirTran reported $3.1 million in net income for the first quarter, compared with a net loss of $7.9 million for the same quarter last year.

That kind of optimism is what you'd expect from an airline veteran with two decades of marketing and management experience. For six years, Mr. Fornaro was U.S. Airways' senior VP-planning, where he helped the airline recover from major losses through fleet reduction and a greater emphasis on more profitable international flights. Before that, he was a senior VP-marketing planning at Northwest Airlines.

EXPERIENCE AS CONSULTANT

After leaving US Airways last year, Mr. Fornaro worked as a private consultant, counseling such clients as Reno Air and AirTran. The current AirTran was formed two years ago via a merger of troubled ValuJet Airlines and Air Tran, with the new entity adopting the latter moniker because of the notoriety caused by the '96 crash of a ValuJet plane in the Everglades.

Mr. Fornaro said research is unclear on whether AirTran carries a stigma because of that crash.

"There always will be some people who say there is," he said. "A lot of those people are very close to the [airline] industry, and they're not the only people to ask."

'A MAJOR COUP'

Joe Leonard, who became chairman-CEO in January, called Mr. Fornaro's hiring "a major coup," noting his experience in helping turn around other foundering airlines.

Mr. Fornaro -- who will focus on finance, planning, marketing and sales -- said the key to similar success at AirTran is to adjust the flight-pricing structure to boost revenues. He sees further opportunity in selling more business-class seats.

AirTran became a two-class carrier last year, when it began offering business-class seats for an additional $25 on direct flights and $40 on connecting flights. Last month, the airline offered customers the chance to pay those fees for an upgrade at the gate.

"As airplanes get more crowded, there's more of a desire for space and elbow room," Mr. Fornaro said. And AirTran will continue to expand flight frequency in and out of Atlanta, while looking to expand into new markets, he added.

He said AirTran is "a good place for an entrepreneur. There's a lot of opportunity and very little bureaucracy. You can have an impact in a company

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