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Airlines Raise Prices Nationwide After Fuel Prices Increase

Airlines Raise Prices After Fuel Prices Increase

Airlines nationwide have announced they will raise prices thanks to increases in fuel costs.

After a period of stability as fuel prices were falling, the airlines announced they will raise prices on base fares. The trend started with United Airlines, which announced it was increasing its fares by up to $10 per round trip within the United States, the New York Daily News reported. Some shorter flights saw the ticket prices increase $4, the report noted.

Other airlines followed suit, with Delta Air Lines, American Airlines, US Airways and JetBlue all making similar increases. Southwest Airlines and its AirTran subsidiary increased ticket prices on all flights of at least 500 miles. As the airline with the most passengers within the United States, Southwestern is seen as a price-setter for many routes, the New York Daily News reported.

“Southwest participation virtually assures the hike will stick,” Rick Seaney, CEO of FareCompare.com, told the New York Daily News.

For American Airlines at least the raised prices are part of a greater strategy to become the industry’s leader by the end of the year. Speaking to a crowd of corporate travel agents this weekend, American Airlines CEO Tom Horton said he plans for his company to be the best in the industry, the Associated Press reported.

“I feel about American the way I feel about America. There’s no option but success,” Horton said. “This is a company that flies our flag around the world.”

If it wants to reach the pinnacle of the airline industry American Airlines will have to do more than raise prices marginally. The company, which last year had its parent company file for bankruptcy, lost $241 million in the second quarter, though the losses were attributed to restructuring.

The airlines nationwide might not have selected the best time to raise prices. A study released Monday showed that 50 airlines worldwide collected a total of $22.6 billion in bag fees and other extra charges, the Chicago Tribune reported.

Industry experts told the New York Daily News that they expect the new price increases to become permanent, making it the fourth time this year that airlines raised prices the first since March. Last year was an even busier year for price increases, with airlines raising base fares more than 10 times.

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Comments

3 Responses to “Airlines Raise Prices Nationwide After Fuel Prices Increase”

  1. Greg Renfroe

    Bull crap, the story as stated by the FAA states that the increases were based on the savings of a federal tax that had expired. The price increase matches the amount of those taxes wsavings almost exactly…