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U.S. Airlines Make Another Attempt to Raise Air Fares

Delta Air Lines and AMR's American Airlines said they raised domestic U.S. air fares $5 each way, again testing pricing power a week after a similar effort failed.

Delta , the No. 3 U.S. carrier, increased the price of walk-up and advance-purchase tickets on flights across the United States to offset cost pressure, especially on jet fuel, said spokeswoman Betsy Talton.

Tim Wagner, a spokesman for AMR's American, said the No. 1 U.S. carrier matched the increase.

Continental Airlines , the No. 4 U.S. carrier, also matched, according to Neil Bainton, chief operating officer at fare tracker FareCompare.com. Continental wasn't immediately available for comment.

Despite matching by some big-name carriers, the increase could still collapse if other carriers like US Airways Group and Northwest Airlines didn't join in.

A similar fare increase attempt, led by Continental, a week ago failed after rivals bailed out after initially matching.

Airlines, which are gearing up for the busy summer travel season, have sought to raise fares to offset higher costs of jet fuel, which vies with labor as an airline's largest expense. The price of jet fuel has risen about 17% over the last four months.

But softening demand amid a weakening U.S. economy has made it difficult for airlines to pass on these higher costs.

Five attempts to raise fares so far this year have largely been unsuccessful, falling apart under competitive pressure, especially from discount carriers like Southwest Airlines.

Fares typically rise in the run-up to the summer travel season; but prices this year have been flat and are now about 10% below where they were a year ago, said Neil Bainton, chief operating officer at fare tracker FareCompare.com.

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