Airlines Try, and Mostly Fail, to Raise Fares

CHICAGO (Chicago Tribune/MCT) -

October has been the month for attempted airfare hikes among major airlines, despite Ebola fears and low jet-fuel prices, as a broad-based try by American Airlines last week to raise fares by a few dollars ended in failure, according to

The latest attempt initiated by American Airlines/US Airways on Wednesday night was relatively small — up to $4 round-trip — but it covered the bulk of American’s route system, according to Rick Seaney of FareCompare.

By Friday afternoon, the fare hike had failed with too few of its competitors following, and the newly merged airline rolled back its prices, he reported.

In the hypercompetitive airline business, fares typically increase when one carrier raises prices and others follow. If competitors don’t follow, the initiator usually drops back its fares.

The attempt was the 21st this year and the fourth in October alone. Five succeeded this year.

Seaney noted the fare-hike attempts suggest that Ebola fears are not hurting demand for flights, and airline executives last week said as much during their quarterly-earnings conference calls.

It also means that savings from lower jet-fuel prices, which boosted airline profits, are not being passed along to consumers, he said.

Other fare-hike attempts included a $10 increase round-trip on Oct. 9 initiated by JetBlue Airways. It was matched by other major airlines but then rolled back, with only JetBlue sticking with the increase. After another attempt Oct. 14 by United Airlines and Air Canada ended in failure, a Delta Air Lines hike of $4 on Oct. 16 succeeded, according to FareCompare.

The average domestic airfare is $396, up 2.5 percent after inflation compared with last year, according to the most recent data from the U.S. Department of Transportation, released Tuesday, regarding the second quarter.

Since 1995, inflation-adjusted fares declined 14.7 percent, compared to a 56.3 percent increase in overall consumer prices, the DOT said.