AA, Other Airlines Boost Fares $10 Round Trip

The big U.S. airlines are raising base fares by $10 per round trip with the busy summer travel season just around the corner.

United, Continental, Delta and American raised prices, but some of the low-cost carriers had not matched the increases by Friday afternoon.

The airlines face sharply higher costs for fuel, one of their biggest expenses. They have pushed through at least six broad price increases this year, but the last two in March failed when some airlines declined to go along.

"It's the good old college try -- if it doesn't work, you try again," said Tom Parsons, CEO of travel website BestFares.com. "One week it's going to stick."

United and Continental raised prices Thursday night, said spokeswoman Julie King. Both are owned by United Continental Holdings Inc., the nation's largest airline operator. They were followed Friday by Delta and American and in part by US Airways, according to airline officials and airfare trackers.

Southwest, AirTran Airways and JetBlue said they had not matched the increase.

The $10 increases applied to heavily traveled routes and to some between smaller cities -- as different as Boston-Los Angeles and Portland, Ore.-Savannah, Ga.

U.S. airlines raised base fares twice in January, three times in February and once in March. As a result, the price of some trips has risen 20 percent in the past year, said Parsons, who cited transcontinental routes including Boston to Orange County, Calif.

Separately, airlines also have increased the price of premium tickets typically purchased only by a small number of corporate fliers and luxury travelers.

UBS analyst Kevin Crissey said earlier this week that business travelers are bearing the brunt of recent increases, based on prices for tickets actually sold since the current run-up in fares began in December.

Crissey said people who buy tickets early -- mostly leisure travelers -- were paying $15 more each way, only about half the publicized rise in base fares. Business travelers paying higher, so-called walk-up fares were seeing increases of more than $30, he said.

Airlines frequently run sales at deep discounts, rewarding customers who can wait for the promotions. Many of them are leisure travelers. This week, AirTran ran a three-day sale that was matched by many other airlines. The deals expired Thursday night.

Airlines say they need to charge more to cover rising jet fuel costs. The spot price for a gallon of jet fuel hovered at $3.12 this week, up 52 percent from $2.05 in early September.

Many airlines try to ease the sting of higher fuel prices through hedging deals, such as buying options contracts to take fuel at a certain price. Those contracts can backfire, costing the airlines tens of millions, if the price of oil or fuel suddenly drops.

Copyright AP - Associated Press
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