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December 15, 2010

American plays the Grinch...initiates fare hike, and rest of the industry matches

FareCompare.com guru Rick Seaney played the bearer of bad news for consumer travelers on Wednesday, pointing out that American Airlines has upped its fares between $6 and $10 and its competitors matched it.

"Domestic airlines have struggled to raise base airfare prices this year as numerous tries have crumbled due to lack of unanimous participation - regardless of the gradually improving economy, airlines continue to live by recessionary domestic pricing motto of not being $1 more or less than their competitor," wrote Seaney in an e-mail.

The domestic airfare hike that American initiated on Monday was $5 one-way for flights over 500 miles and $3 one-way for shorter flights across most of its route system.

This may be the first of many fare hikes as fuel costs continue to rise for the airlines, Seaney said.

"With oil prices hovering near 2010 highs of $90/barrel and airline executives recent positive statements regarding winter demand it is likely we will see more domestic hike attempts as we head into 2011," Seaney said.

-Andrea Ahles

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Comments

GougeEm

Gouge em to profitability man, Gouge dem sheep

TiredOfPanderingANDREA

Profitability isn't the goal -- ARPEY's bonuses are the goal.

Richard

Gouge us? When airfares are lower (adjusted for inflation) than they were ten or twenty years ago? It's hardly gouging.

If you don't like it you can take the bus or pay for gas and your own vehicle. Welcome to the free market.

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