Biggest Airlines Raise Fares By $20 Roundtrip

NEW YORK (AP) – The surge in oil prices is translating into even higher costs for air travelers as well as drivers.

Some of the nation’s biggest airlines raised most domestic fares by an additional $20 roundtrip over the weekend, adding to the strain on consumers now paying an average of more than $4 a gallon for regular gas.

The increases follow a dramatic two-day run-up in oil prices late last week that left the cost of crude more than 13 percent higher in just two days. Prices eased Monday but remained above $135 a barrel.

AMR Corp.’s American Airlines launched the latest round of fare increases, and was quickly matched by some of its closest competitors, including UAL Corp.’s United Airlines and Delta Air Lines Inc., representatives for the carriers said Monday.

The increase marks the struggling airline industry’s seventeenth attempt to raise fares or fuel surcharges this year, according to airfare research site FareCompare.com. At least a dozen of those increases remain in place across much of the carriers’ route networks.

“As the constant drumbeat of airfare hikes continues in the coming weeks and months, travelers should pay heed and lock in their airline tickets as quickly as possible,” Rick Seaney, FareCompare’s chief executive, said in an e-mail.

Continental Airlines was among the carriers that matched the increase over the weekend, but it rolled the higher prices back Monday, FareCompare said, raising the possibility that other airlines might undo their hikes as well.

A representative for the Houston carrier could not immediately be reached.

Because the airline industry is so price-sensitive, carriers typically keep airfare increases in place only if competitors match the prices on the same routes.

Airlines have been scrambling to cut costs and increase revenue to cope with rapidly rising fuel prices. A gallon of jet fuel now costs about 77 percent more than it did a year ago.

A number of airlines recently laid out sweeping plans to cut jobs, slash flights and ground dozens of less efficient planes. Carriers hope they can push fares even higher by reducing the number of available seats in the air.

American, the biggest U.S. carrier, last month raised the stakes in the industry’s effort to push more costs onto consumers when it became the first major carrier to say it would start charging some fliers $15 to check the first bag. The Fort Worth, Texas-based airline also raised a number of other charges.

“Even when we raised fees a couple of weeks ago, we said that wasn’t the only thing we were doing, that we would still be trying to recoup fuel costs through fare increases,” spokesman Tim Wagner said. “The (fuel cost) increase is so incredible, we have to find a way to pass it on.”

American’s new baggage charge is scheduled to take effect on tickets bought on or after June 15. The carrier last week said the $15 fee would affect fewer than one in four customers this summer and won’t lengthen lines at boarding gates.

Other major carriers, many of which already charge to check a second bag, have not said they will begin charging passengers to stow a first bag in the cargo hold, although they are not ruling it out either.

“We are still studying that very carefully,” said Robin Urbanski, spokeswoman for Chicago-based United, the No. 2 U.S. carrier.

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Schuyler Dixon in Dallas contributed to this report.

(Copyright 2008 by The Associated Press. All Rights Reserved.)