Air Fares Going Up Today
Undated (AP) _ The nation’s major airlines plan to raise round trip ticket prices by as much as $50 today, hoping to end a series of fare wars that led to huge losses.
American Airlines, Delta Air Lines, United Airlines, Trans World Airlines, Continental Airlines, Northwest Airlines, USAir and America West Airlines all said Thursday they planned to proceed with increases. The hikes originally were scheduled to kick in a week earlier.
″In the long run, no industry can continue to price its product at below cost,″ said Tim Smith, a spokesman for American, the nation’s largest carrier.
The new fares will be based on miles traveled rather than the popularity of a particular run between two cities. The price increases were expected to mark the end of a summer that saw big fare cuts and packed planes but also huge losses for the nation’s air carriers.
″Let’s certainly hope so, because it was disastrous for all of us,″ said Delta spokesman Neil Monroe.
The discounting helped raise airplane loads from 68 percent in July 1991 to 73 percent this July, but the industry still lost $668 million in the first six months of 1992, according to the Air Transport Association. That followed losses of $2.4 billion in 1990 and $1.6 billion in 1991.
″We believe it’s necessary to have a price increase. We believe that it makes business sense,″ said TWA spokesman Don Fleming.
Previously announced increases that never were implemented didn’t hold up because one airline or another tried to keep a competitive edge.
The raises bring fares back up to the levels they were in April, when American initiated a fare overhaul - touching off a price war.
While most fares will rise between $10 and $40, some longer runs will go up $50. Some markets won’t see any increase in prices.
For example, the round trip excursion fare on Continental between New York and Detroit will rise from $220 to $230. The round trip fare from New York to Los Angeles will increase from $390 to $440 while the price of a round trip from Boston to Denver will remain unchanged at $430.