With many of the major airlines slashing their most expensive fares this winter, business travelers should be able to shave their spending...
CHICAGO — With many of the major airlines slashing their most expensive fares this winter, business travelers should be able to shave their spending on domestic airfares by about 17 percent, according to a National Business Travel Association study released yesterday.
A loosening of restrictions — giving travelers the ability to get a discount fare without staying over on a Saturday night, for instance — should enable travelers to trim 10 percent from the cost of a flight, the association estimated yesterday. And that savings will be layered atop a 7 percent decrease in average undiscounted domestic fares, from $286 to $266, according to the study, which used fare data from 2,500 flight routes in December and February.
Of course, the actual level of fare savings will vary, depending on where a business traveler is going and on which airline, the association noted.
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Still, given all the recent airfare changes, many corporations will be weighing whether to cancel their existing airline contracts and adopt “spot buy” strategies or negotiate new discount arrangements, the association said.
“This is a very significant change in the way airlines price their product,” said Carol Devine, president and chief executive of the association.
“Every corporation that has a corporate discount and a high-volume program should be evaluating them now,” she said.
In January, Delta Air Lines rolled out a simplified fare structure that lowered the price of many business fares. And in many markets, its rivals reduced their prices in response.
American Airlines and Delta have had the greatest average fare reductions, of 11 percent each, the study found. US Airways saw the smallest reduction — 1 percent on average.
The fare-structure overhauls at many of the major airlines are aimed at recapturing business travelers who either had switched to discount carriers or who had reduced air travel altogether. The cuts are expected to trim U.S. carriers’ revenues by $2 billion to $3 billion in 2005.
The major airlines on Saturday announced small fare hikes in selected markets, but Devine said these changes do not alter the study’s basic findings.