NYRANGERS
Well-known member
- Joined
- Jun 13, 2002
- Posts
- 592
I hope all the majors go along with this one. Gotta love Mike Boyds statement (last paragraph). At least one analyst seems to get it.
American Airlines sets fare hike, United matches
May 09, 2003 4:17:00 PM ET
By David Bailey
CHICAGO, May 9 (Reuters) - American Airlines and United Airlines, the two largest U.S. air carriers, on Friday said they will raise all nonsale domestic fares by $5 each way starting June 1 as carriers look for ways to stop huge losses.
Neither airline identified the reason for the increase, though it goes into effect the same day passenger security fees will be suspended temporarily under a government relief plan set to help airlines weather a travel slump from the war with Iraq.
American, a unit of AMR Corp. (AMR) and the world's largest air carrier, on Thursday raised all published fares within the United States and Canada by $5 one-way and $10 roundtrip for travel on June 1 and later, a spokeswoman said.
Bankrupt United, the No. 2 U.S. air carrier and a UAL Corp. (UALAQ) unit, matched the increase, a spokesman said.
Other large U.S. airlines, including Delta Air Lines (DAL), the No. 3 U.S. air carrier, Northwest Airlines Corp. (NWAC), the No. 4 U.S. air carrier, had not matched the hike by Friday afternoon, leaving doubt as to whether it will stick.
"It effectively covers everyday leisure fares, but there are so many sales that it probably doesn't mean that much," Bestfares.com chief executive Tom Parsons said. "We will have to see how Northwest reacts and how the public reacts."
U.S. airlines have reported billions of dollars of losses since the September 2001 hijack attacks. The war with Iraq and the pneumonia-like SARS virus, or Severe Acute Respiratory Syndrome, added to airline woes in recent weeks.
The government relief plan includes $2.4 billion in cash reimbursements to airlines for security costs and extends government-backed war risk insurance for one year, saving about $600 million. It also suspends passenger security fees from June 1 through September 30, about $520 million in fees.
"(The suspension) does give airlines some leeway (to raise fares) because there are limited consumer dollars out there," aviation consultant Michael Boyd said, adding that airlines need to get every dollar they possibly can at this point.
"The consumer has to understand that air transportation will have to get more expensive, not less expensive, or you won't have an air transportation system at all," Boyd said. (Additional reporting by John Crawley in Washington) REUTERS
© 2003 Reuters
American Airlines sets fare hike, United matches
May 09, 2003 4:17:00 PM ET
By David Bailey
CHICAGO, May 9 (Reuters) - American Airlines and United Airlines, the two largest U.S. air carriers, on Friday said they will raise all nonsale domestic fares by $5 each way starting June 1 as carriers look for ways to stop huge losses.
Neither airline identified the reason for the increase, though it goes into effect the same day passenger security fees will be suspended temporarily under a government relief plan set to help airlines weather a travel slump from the war with Iraq.
American, a unit of AMR Corp. (AMR) and the world's largest air carrier, on Thursday raised all published fares within the United States and Canada by $5 one-way and $10 roundtrip for travel on June 1 and later, a spokeswoman said.
Bankrupt United, the No. 2 U.S. air carrier and a UAL Corp. (UALAQ) unit, matched the increase, a spokesman said.
Other large U.S. airlines, including Delta Air Lines (DAL), the No. 3 U.S. air carrier, Northwest Airlines Corp. (NWAC), the No. 4 U.S. air carrier, had not matched the hike by Friday afternoon, leaving doubt as to whether it will stick.
"It effectively covers everyday leisure fares, but there are so many sales that it probably doesn't mean that much," Bestfares.com chief executive Tom Parsons said. "We will have to see how Northwest reacts and how the public reacts."
U.S. airlines have reported billions of dollars of losses since the September 2001 hijack attacks. The war with Iraq and the pneumonia-like SARS virus, or Severe Acute Respiratory Syndrome, added to airline woes in recent weeks.
The government relief plan includes $2.4 billion in cash reimbursements to airlines for security costs and extends government-backed war risk insurance for one year, saving about $600 million. It also suspends passenger security fees from June 1 through September 30, about $520 million in fees.
"(The suspension) does give airlines some leeway (to raise fares) because there are limited consumer dollars out there," aviation consultant Michael Boyd said, adding that airlines need to get every dollar they possibly can at this point.
"The consumer has to understand that air transportation will have to get more expensive, not less expensive, or you won't have an air transportation system at all," Boyd said. (Additional reporting by John Crawley in Washington) REUTERS
© 2003 Reuters
