As airlines struggle, some LR fares lose altitude
Posted on Tuesday, August 19, 2008
With demand for air travel falling, some airlines are cutting autumn fares to levels not seen since oil prices began skyrocketing last year.
The bargains are sporadic and not widely publicized as airlines hope to keep fares high for markets where demand is still robust or where there is little competition.
Yet “it’s a good time to fly if you want to put up with the grief,” said Joe Brancatelli, editor of the business travel Web site JoeSentMe. com.
Rick Seaney, chief executive of online travel service Fa re Co m pa re. co m, said there are a number of roundtrip deals under $ 200 for flying from Little Rock National Airport, Adams Field.
FareCompare. com, for example, lists round-trip fares from Little Rock starting at $ 139 to Tulsa, $ 157 to Raleigh-Durham and Dallas-Fort Worth, and $ 161 to Tampa.
Overall, big cities are up 25 percent in price from a year ago, mid-tier cities are up 30 percent in price and smaller airports are up 20 percent, Seaney said.
After checking flights from Little Rock, Tom Parsons, chief executive of travel Web site BestFares. com, said, “I’m really surprised that you’re getting so many deals.
“ Probably even some of these smaller regional airports get better deals because there won’t be any business travelers in the sky” because of the weak economy, he added. However, Seaney said the lowest round-trip fares for Northwest Arkansas Regional Airport at Highfill are still mostly between $ 250 and $ 300.
International fares are hovering at an average of 50 percent more than last year — mostly because of fuel surcharges of as much as $ 400 — but there are signs of weakening, Parsons said. Some foreign carriers began dropping prices by as much as 50 percent, with round-trip fares from Los Angeles to London dropping to about $ 900 from $ 1, 600. The latest dip in oil prices — to $ 112. 87 a barrel at Monday’s close from a peak of about $ 145 last month — is giving airlines some room to lower fares. But analysts and travel experts said the bargains were driven for the most part by one of the industry’s worst fears: flying planes with empty seats. Even with the latest drop in the price of oil, fuel costs are 53 percent more than a year ago. Demand for air travel is falling faster than airlines can eliminate flights to take empty seats off line, Brancatelli said. In all, domestic airlines are cutting about 10 percent of available seats.
“People are hesitant to spend money... and the concept of taking a trip on an airliner these days is not appealing, particularly with all the new fees and service cuts,” said Jack Kyser, chief economist for the Los Angeles Economic Development Corp.
Airlines typically slash fares in the autumn when travel trails off after the summer vacation season. Previously, however, experts had said they expected fewer fare sales and smaller discounts this fall because of high fuel costs.
“I didn’t expect any fare sales, so it was surprising,” Seaney said. In the first half of the year, airlines tried to raise fares 21 times, but Seaney said there had been no such attempts in the last several weeks. “Before, we were averaging one a week,” he said. “It’s a pretty telling sign that we are close to a tipping point.” George Hobica, founder of Airfarewatchdog. com, which also tracks air fares, said he was seeing “some astoundingly low fares.” He recently found a flight from Cincinnati to Las Vegas for $ 106. “We never thought we’d see that again,” he said.
The average domestic fare for fall travel is still up about 14 percent, or about $ 40 higher than last year, according to travel Web site Travelocity.
Although some fares are dropping, passengers shouldn’t expect the myriad new fees airlines have begun imposing on baggage, pillows, blankets and drinks to go away. Brancatelli said that, with the exception of the fee for the first checked bag, “other fees are here to stay.” Information for this article was provided by Peter Pae of The Los Angeles Times and Laura Stevens of the Arkansas Democrat-Gazette.
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