18th Domestic Airfare Hike Faltering
UPDATE: Oct. 27, 2011 The 18th broad-based domestic airfare hike has collapsed, as all the major legacy carriers began rolling back prices late last night and throughout today.
Oct. 26, 2011 11 a.m. CDT: Chaotic airfare filing appears to be dooming the most recent domestic airfare hike attempt, the 18th broad-based attempt of the year.
On late Monday, legacy airlines had raised airfares from $4 to $10 round-trip based on route distance and it appeared until late Tuesday that the increase attempt might stick, even without the participation of Southwest/AirTran and JetBlue.
Airline ‘Rollback Chaos’
While domestic airlines were in the middle of hiking airfares system-wide, there appeared to be some disagreement between the carriers as to whether or not they should hike a variety of non-holiday winter travel sales that are currently in the system. As it turned out, some airlines raised those prices while others did not, causing a certain amount of rollback chaos.
See the latest holiday airfare sales on the FareCompare Deals Blog
On top of this issue, late Tuesday evening US Airways began to rollback its hike on routes under 500 miles one-way, and this morning, Southwest appeared to have instituted a mileage-based minimum price strategy of $129 each way for one-way routes greater than 1,500 miles and $149 for those greater than 2,000 miles, making it even more difficult for other airlines to match.
Listen to what these hikes can mean for procrastinating airfare shoppers:
What This Means for Holiday Travelers
In general, domestic airlines have no choice but to match each other because consumers compare prices and any airline $1 more than the competition ends up on Page 20 of comparison results.
After watching hundreds of airfare hike attempts in the past decade, I have never seen one stick that has this much post-initial matching chaos without low cost airline support, so I would not be surprised to see this one completely falter later today.
Consumers watching these back-to-back hikes may have been wondering whether airline tickets were going to get so high as to be out of reach, but take heart: airlines still have to fill up the last third of their domestic aircraft with cost conscious passengers.
