Airlines fare hike seems to waver
DALLAS – The last attempt by airlines to increase fares in general – hiking the $ 4 to $ 10 per round trip in the United States – Monday faltered as some airlines reluctant to increase.
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United and Continental fare hikes began on Friday and most other airlines went along at first. But on Sunday, Southwest rolled back the increases, and Americans have made the same morning on Monday.
"We solved this increase, because other airlines also pulled back," said Tim Smith, a spokesman for the U.S..
Rick Seaney, CEO of FareCompare.com, said the south-west "chatter" during the weekend was "probably trying to scuttle this price increase."
U.S. airlines raise domestic prices based on several occasions in early 2011 to increase revenue, as they faced rising fuel costs. The last broad fare increase was in April.
Why do companies constantly run sales, the average price paid by passengers often do not increase as much as the fare increase said base. Southwest and others have recently managed the aggressive sales for the fall, when demand falls trip.
The airlines may be reluctant to raise prices if they fear alienating passengers. Traffic growth fell in June at the two largest companies, Continental Holdings Inc., United and Delta Air Lines Inc. Analysts said fear of weakening demand has hurt airline stocks.
Airlines often do not discuss why or when to raise prices, partly for fear of violating laws that bar them from pricing decisions to report to each other.
The airlines have tried to raise fares more than a dozen times this year, with about half of the increases attack, but none since April.
Ray Neidl, an analyst for Maxim Group LLC, said it was surprising that the airlines have tried to raise prices so late in the summer for the fall season slower. He said the uncertain economy make it difficult to price hikes and there might even be off after Labor Day, "depending on how weak demand becomes."
Copyright 2011 The Associated Press. All rights reserved. This material may not be published, broadcast, rewritten or redistributed.
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