NEW YORK (Reuters):
Leading U.S. air carrier American Airlines and three rivals on Friday said they had raised ticket prices in various markets, seeking to recoup some of their increased costs from record fuel prices.
Northwest Airlines, America West Holdings Corp. and JetBlue Airways Corp. all hiked fares, following similar moves starting on Wednesday by rivals Delta Air Lines Inc., UAL Corp.'s United Airlines and Continental Airlines Inc.
Most carriers said they raised fares to help mitigate the impact of soaring fuel costs. Crude oil futures added to recent gains on Friday, notching a fresh record above US$67 a barrel.
"It had to happen," said Terry Trippler, airline expert at Cheapseats.com. "The price of crude oil is out of line obviously. Unfortunately, the (fare) increases are not enough to cover what has occurred, and we can expect more increases as early as next week."
The airline industry has been struggling to contain surging fuel costs, which have overtaken labour costs as the biggest expense for some airlines. And low-cost competition has made it difficult for airlines to pass along the expense to travellers.
American, owned by AMR Corp., hiked fares on a range of domestic routes, with increases mostly ranging from $5 to $10 each way, spokesman Tim Smith said on Friday. American raised its fares on Thursday.
No. 4 U.S. carrier Northwest said it matched its rivals fare hikes on Friday and has broadened its fare hikes to match price caps of $599 and $699 by a key rival on some routes.
Discount carrier JetBlue raised fares by $5 on flights to and from Florida and on some transcontinental flights, spokeswoman Jenny Dervin said. JetBlue's fare hike took effect Thursday.
American West said it had matched Delta's fare increase of $10 each way.
The higher ticket prices did little to help the beleaguered industry's shares, as analysts say carriers face billions of dollars in losses at best and more bankruptcies at worst.
UAL Corp. and US Airways Group Inc. are already operating under Chapter 11 bankruptcy protection from creditors.
Delta shares were down 16 cents, or 8.9 per cent, at $1.63, Continental was down 40 cents, or 2.7 percent, at $14.22, and AMR was down 16 cents, or 1.2 per cent, at $13.24, all on the New York Stock Exchange. On Nasdaq, Northwest was down 8 cents, or 2 per cent, at $4.03, and JetBlue was up 5 cents, or 0.3 per cent, at $19.07.
