U.S. airlines raise fares by $4 to $10 on roundtrip tickets

10:20 AM, Jan 11, 2011   |    comments
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U.S. airlines have raised domestic fares for the first time this year, their third hike in the past month, according to travel search site Farecompare.com.

Late Friday, Southwest Airlines, which rarely initiates an airfare hike, raised fares by $4 to $10 roundtrip ($2 to $5 one-way) based on flight distance, it says. Most U.S. airlines, including Delta, American, United/Continental, US Airways and Frontier, soon matched over the weekend.

FareCompare says it "detected a relatively minor amount of airfare hike activity in Northern/Midwestern cities this past week." It normally wouldn't have been a significant event, but that Southwest implemented a similar hike on most of their routes caught its attention.

Southwest's participation "virtually assures this hike will stick," wrote Rick Seaney, CEO of Farecompare.com, in an e-mail.

Rising fuel prices and greater demand are pushing fares higher. "We haven't seen this pace of domestic airfare hikes since 2007 when fuel prices began to jump dramatically in the last quarter and airlines began to institute fuel surcharges," Seaney wrote.

Fuel prices have been hovering near recent highs and airlines are still careful about adding more seats despite strengthening demand.

Airlines have been also renewing domestic peak travel surcharges between $10 and $30 roundtrip for 2011 travel.

Seaney says he doesn't believe airfare hikes are related to the recent spate of ticket distribution issues between online sellers and airlines.



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