A fare increase launched by American Airlines appeared to stick yesterday, as Northwest Airlines, Delta Air Lines and Continental Airlines...
MINNEAPOLIS — A fare increase launched by American Airlines appeared to stick yesterday, as Northwest Airlines, Delta Air Lines and Continental Airlines said they, too, would raise fares in most U.S. cities.
American blamed fuel prices when it announced fare increases of $5 one-way and $10 round-trip on most domestic and U.S.-Canada flights on Thursday. It was the latest among several fare increases by U.S. airlines in recent months. Some stuck when competitors matched them; others were abandoned.
Northwest spokesman Kurt Ebenhoch said the airline matched American except in markets where they offer fares to compete with Southwest Airlines and JetBlue Airways. Northwest also didn’t raise its higher-priced walk-up business fares, he said.
Continental and Delta also acknowledged matching the increases yesterday afternoon.
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American said it needs the higher ticket prices to offset high fuel costs. American has said that each $1 increase in the price of a barrel of oil costs it about $80 million a year.
Rising fuel prices have bedeviled most airlines this year. Southwest has been an exception, making heavy use of financial hedges to lock in lower prices, including 85 percent of its fuel for the rest of this year at prices that are about half the going rate.
Northwest Chief Executive Doug Steenland blamed fuel prices as one of the factors in the $458 million loss it reported last week — its largest quarterly loss ever. Several other airlines also blamed fuel prices in reporting results this month, when combined losses at the six so-called legacy carriers reached $33 billion since 2001.
This is at least the fifth fare increase since February, said Tom Parsons, who runs discount travel Web site Bestfares.com. He said that in recent years, it’s often been Northwest that acted as a spoiler, refusing to go along with increases by others.
“When you lose 400 and some million dollars in a quarter, and you don’t go along with fare hikes, I think some of your shareholders will get a little irritated with you,” Parsons said.