Cheap Flights from Low-Cost Carriers Pressuring Big Airlines
Good News for Air Travelers
Pressure placed on United States airlines by discount carriers, has caused the recent airfare hike to be cut by half. During last week, disappointed air travelers saw the major networks, such as United, Continental, Delta and American; increase many of their domestic round-trip airfares by $20. However, Monday afternoon saw this increase cut to $10.
This particular increase followed five previous broad-based attempts to increase prices this year, with most of the increases holding. Up to $60, a round-trip is among the two larger increases imposed, which related to the high priced ticket preferred by business passengers. The third attempt by the airlines to raise business fares, failed.
Reports stated that the recent rollback occurred following the raising of fares by traditionally low-fare airlines. These included JetBlue, Air Tran, and Frontier, whose increases were half that of the major carriers. To avoid charging more than low-fare competitors, the network airlines then reduced their increases,
Indications are that United States airlines will continue to test the market for increases during the coming weeks. It will be grounds for observing the tolerance level of air travelers. Adding to this it will in turn be interesting for the market, to view any decline in passengers if there are increases in leisure travel prices!
One statistic emerging that places the latest increases in perspective is that even on “sales offers” from the airlines, they are at a higher price than one year ago. For example, reports indicate that Southwest increased its lowest sale price for a short trip by $5 each way.
Another cause for consideration by air travelers is that airlines increased fuel surcharges, between the United States and Europe, from $360 to $400 a round-trip. A further example of the affect of the price increases is an advanced-paid ticket, between New York and Paris, for late March cost $225. However, the surcharge imposed, almost tripled the cost of the journey.
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