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First U.S. airfare hike of the year targets business travelers

Feb 22, 2013 7:48 am

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U.S. airlines have no shame in repetitively attempting $4-$10 hikes on domestic routes — this is the fourth one this year – and it’s more likely to stick since it only includes last-minute bookings.

— Samantha Shankman

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The first nationwide hike in U.S. airfares looks like it’s taking hold this week, as Delta Air Lines initiated a ticket-price increase, according to FareCompare.com.

However, the effort is limited — an increase of $4 to $10 roundtrip on domestic flights booked inside of seven days before departure, most likely to affect business travelers.

Three other attempts to raise fares this year failed. In the hypercompetitive airline business, fares typically increase when one carrier raises prices and others follow. If they don’t follow, the initiator usually drops back its fares.

Delta initiated the increase on last-minute fares Wednesday. By Thursday afternoon, American Airlines, Southwest Airlines, US Airways and JetBlue Airways had matched it, leaving Chicago-based United Airlines as a significant holdout, according to FareCompare.

“I would be surprised if United doesn’t join later this evening,” FareCompare CEO Rick Seaney said on his site.

In 2012, airlines attempted 15 fare increases, of which seven stuck, according to Seaney. United started two of the three unsuccessful attempts this year, with Delta trying the other.

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