United Airlines raises fares up to $60 roundtrip

NEW YORK - Turns out that new airline checked-bag fee wasn’t the end of it.

Airlines ratcheted up the pressure on fliers ahead of the holiday weekend, significantly raising ticket prices to offset the runaway cost of fuel. The three biggest carriers each boosted most domestic fares by up to $60 roundtrip, while budget airline AirTran Airways raised its leisure fares by $30 roundtrip.

UAL Corp.’s United Airlines led the bigger round of increases late Thursday, lifting roundtrip ticket prices by $10 to $60, depending on how far passengers fly and the competition on the route. Travelers will pay the biggest increase on routes of 750 miles or more — less than the distance from New York to Chicago — that low-cost carriers such as Southwest Airlines Co. do not serve.

“It’s part of all the work that we’re doing to try to offset fuel costs,” spokeswoman Robin Urbanski said.

American Airlines, the biggest U.S. leading carrier, said it matched the increase Friday.

Delta Air Lines Inc. also matched the increase, according to airfare research site FareCompare.com. The Atlanta-based carrier did not respond to multiple calls seeking comment.

Separately, AirTran raised leisure ticket prices by $30 and business-class fares by $50 roundtrip. Such a large change is unusual for a budget carrier.

The increases came just days after American said it would begin charging customers $15 to check a single piece of luggage. Representatives from a number of other carriers, many of which are already charging $25 for a second checked bag, have not ruled out following suit.

“Everything is under consideration with fuel the way that it is,” AirTran Holdings Inc. spokeswoman Cynthia Tinsley-Douglas said.

Airlines have come under intense pressure to boost revenue and cut costs as the cost of fuel has soared. As of Monday, spot prices for jet fuel in New York were up 43 percent from the start of the year, according to the Energy Information Administration.

Chicago-based United has been among the most aggressive carriers in pushing fares and fuel surcharges higher, and its increases are often rapidly matched by competitors. Airlines are prohibited from agreeing to simultaneously raise fares, but nothing prevents them from following a rival’s lead.

“Airlines have no choice but to pass on the cost of fuel to consumers and when passengers do begin to push back in significant numbers the airlines have no choice but slash capacity,” said Rick Seaney, chief executive of FareCompare.com, in an e-mail.

In another sign of the pressure facing air carriers, Northwest Airlines Corp.’s cargo division said Friday it was raising its fuel surcharges on domestic and some international routes.

Southwest won't charge for bags
Southwest Airlines says it has no plans to begin charging a fee for passengers to carry their first bag on board, in response to a New York Times article that said the carrier was considering following a move earlier this week by American Airlines.

American Airlines said Wednesday it will begin charging passengers on discounted fares $15 to check their first bag on a one-way flight, or $30 roundtrip.

"We want to assure you that Southwest Airlines still allows you to check up to two free bags when you travel with us, and has no plans to change that," the company said in a statement.

Postponing China
Two airlines that only months ago won federal approval to begin highly coveted routes to China are postponing the launch of the new services because of high fuel costs.

The requests come at a time of growing strain on the airline industry, which is anticipating multibillion dollar losses this year as it scrambles to cope with runaway oil prices and a slumping U.S. economy.

United Airlines has sought and US Airways plans to ask for one-year delays in launching the new routes, representatives from the carriers said Thursday. United won final approval and US Airways received the tentative go-ahead to launch the routes from the U.S. Department of Transportation in September.

The routes in question affect planned United service between San Francisco to Guangzhou, and US Airways flights between Philadelphia and Beijing.

Access to routes between the U.S. and China is highly competitive because air service between the two countries is restricted by bilateral agreements. A July agreement between the two countries was intended to double the number of daily flights allowed between the two nations over the next five years.

United’s request for a delay was approved April 25, while the request from US Airways has not yet been received, Transportation Department spokesman Bill Mosley said.

United, a division of UAL Corp., was scheduled to start its new flights in early June, but now plans to postpone the launch until June 2009. Spokeswoman Robin Urbanski said the Chicago-based carrier is scaling back plans for some new international routes where there aren’t “strong enough economics” to offset higher fuel costs.

United received final approval for its route in September, the same time Delta Air Lines Inc. won the opportunity to launch its first flights to China with a daily route between Shanghai and Atlanta. Delta’s flights began March 31.

US Airways has begun sending letters to members of Congress and its employees saying it would seek to delay the launch of the new Philadelphia-Beijing route, noting that the cost for fuel would be more than $90 million a year — $40 million more than the original estimate of about $50 million.

“We’re optimistic that economic conditions will be on the upswing in 2010, giving us a better chance of success with our first route to China,” Scott Kirby, the president of Phoenix-based US Airways Group Inc., said in a letter to workers.

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