Domestic Airfare Hike Attempt #8 – Update

Airfare Hike Attempt #8 – Most Recent Update

I realize this is a bit “inside baseball”, but I’ll attempt to briefly walk through the significant events related to this most recent airfare hike attempt.

Immediately after United/Continental filed the $10 roundtrip domestic airfare increase yesterday morning, Delta increased prices, not by matching exactly but by filing a laddered hike from $6 to $14 roundtrip based on flight distance (with a few routes at $20 to $30 roundtrip) — additionally US Airways began a smattering of limited matching.

Typically this means that one of the two mega-carriers would have to adjust their hikes to maintain competitive equilibrium.

Thorough the back half of Monday and bulk of Tuesday crickets could be heard chirping until 8pm this evening when Delta bailed out completely by rolling back while at the same moment American joined in by matching United/Continental at $10 roundtrip as the low cost airlines stayed pat.

At this point either Delta will refile at the $10 roundtrip level across the board with US Airways jumping in with both feet (all the legacies likely tiptoeing around low cost airline routes) — or — American and United/Continental will bail be forced to bail out if Delta doesn’t jump back in sharpish Wednesday.

Airfare Hike – What Does This Mean For Consumers?

Bottom line:
. Domestic ticket prices are much more likely to go up than down in the short term
. The few empty middle seats today will become non-existent tomorrow
. A handful lucky travelers will be able to take advantage of a spate of deals on highly competitive routes

It is likely legacy carriers will continue to probe on a regular basis with hike attempts, tracking the trend in oil prices — testing both travelers wallets and their low cost cousins appetite to lift base prices.

Based on past airfare hike activity, I would expect a coin flip to decide the success of this 8th domestic hike attempt of 2011 — we’ll let you know if it turns out heads or tails.


Rick Seaney, CEO


Published: March 23, 2011