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Airfares Going Up

UPDATE 1: Wednesday February 2, 2011 3:50pm CST

In a flurry of activity over the past 18 hours, several airlines have matched the American-initiated domestic airfare hike of $4 to $10 roundtrip, including Continental, Delta, United, US Airways, JetBlue, Alaska, AirTran, Air Canada and WestJet. Only Southwest and Frontier are still sitting on the sidelines.

United/Continental Airlines – as part of their matching of the American airfare hike – did drop their $6 round-trip fuel surcharge – in what appears to be related to the domestic airlines’ motto of “never be a dollar more or less than your competitor unless you have a scheduling advantage”  – a motto fostered by consumers’ inclination to comparison shop for airfares.

EARLIER: Tuesday February 1, 2011 3:00pm CST

Over the last 24 hours the FareCompare proprietary airfare analysis engine has detected significant fare and fuel surcharge hike activity from several domestic U.S. airlines.

Oil Hits $100, American Airlines and United/Continental Raise Airfares

Coinciding with Brent crude prices hitting a two year high of $100/barrel, late yesterday evening there were two new developments:

• American Airlines initiated an airfare hike between $4 and $10 roundtrip on the bulk of their domestic route system
• United/Continental cautiously added a fuel surcharge of $6 roundtrip to a significant number of routes, being careful to tiptoe around the routes of low cost airlines and the cheapest of sale fares.

This is the third airfare hike attempt this year (and there were two in December 2010). All in all, the four previous domestic airfare hikes in the past couple of months all met with varying degrees of success.

Outside of peak travel “miscellaneous”? airline surcharges (charges for specific high volume travel periods), we haven’t seen domestic fuel surcharges since November 2008 when U.S. airlines dropped them from domestic airfares as fuel prices plummeted from summer highs of $140+/barrel that year.

Other Airlines Add Airfare Hikes

Additionally, JetBlue added a fuel surcharge to Puerto Rico and the Caribbean flights of between $70 and $90 roundtrip, while American also increased prices to Canada by $22 roundtrip (matched by Air Canada) and also to Hawaii by $21 roundtrip.

During the day, both US Airways and Alaska Airlines (on itsCanadian routes) began matching American’s hike, with Delta matching a smattering of the fuel surcharge increases.

Southwest, AirTran and Frontier – No Hike Yet

Staying out of the fray for the moment are Southwest, AirTran and Frontier.

We will update on significant changes in matching the airfare hikes – or roll backs – as they occur.

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