Up and down airfares: up again
The latest round of on-off fare increases for the major airlines was going ahead again this week as American, Delta, United and other US carriers reinstated a $10 increase in domestic roundtrip fares.
That move came just after scrapping the higher prices.
The airlines say, and analysts agree, that rates have to be higher to pay for increased fuel costs.
The average one-way coach fare is now $98, according to Harrell Associates, an industry consulting firm that follows air fares.
That rate compares with $89 for early January after Delta put out its SimpliFares program. Delta cut rates by as much as 50%, with the other carriers following.
The larger airlines have made sporadic efforts to raise their fares since late 2002, but the effort has generally failed after one or two carriers don’t follow suit.
The fare cuts have cost the airlines the equivalent of $1.5 billion in revenue since January, said airline analyst Raymond E. Neidl, quoted in The New York Times.
The fares have obviously succeeded in driving traffic. In January, normally the slowest travel period of the year, domestic traffic rose 7.7%, said the Air Transport Association.
Report by David Wilkening
David
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