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Oil may be down, but airfares resume upward climb

Post by John Gillie / The News Tribune on July 31, 2008 at 8:54 am with No Comments »
July 31, 2008 8:54 am

Northwest Airlines Wednesday night initiated an $80 roundtrip airfare increase on over 4,000 routes for both leisure and business travelers.


The airline was careful about attempting to raise fares only on routes without significant low-fare competition.


The fare increase attempt, which could be withdrawn if competitors don’t match it, is the first in about a month by a major U.S. airline.


Previously airlines had been initiating about one airfare increase attempt a week. Airlines have initiated 21 wide ranging airfare increases this year, said Rick Seaney, chief executive of FareCompare.com.


Though crude oil prices are falling, airlines have yet to raise fares and cut costs enough to return to profitability.


Most of the fare increases centered on Northwest’s Detroit hub rather than on its other two hub cities, Minneapolis and Memphis.


SeaTac’s Alaska Airlines is initiating non-stop service from Sea-Tac to Minneapolis at introductory prices, a factor that may stave off a Northwest increase on that route.

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