January 13, 2012- The first increase in airfares for 2012 took place this week. Delta hiked its fares by $20 and other domestic airlines quickly matched them. The $20 airfare increase on Delta flights was for long-haul routes. Frontier and Southwest matched the Delta increase late Wednesday and United/Continental, U.S. Airways and American increased its fares Thursday.
Of the 22 fare increase attempts made by airlines in 2011, only nine took hold. Airlines had to roll back the others after competition did not match the increases in prices. An online airfare watcher said he feels domestic hikes will continue every few weeks this year. Limited success will occur although, he said.
The new hike in prices has taken place only weeks before a new U.S. Transportation Department rule goes into effect. Starting January 26, airlines must include mandatory fees and taxes in all advertised fares. That will amount to nearly a 20% increase or more on prices of tickets.
Airlines have said fare hikes are due to the higher prices in oil that threatens their profitability. Oil prices increased again on Thursday as did the euro, but eased when a report said the European Union might delay a ban against exports from Iran by six months. U.S. crude fell to below $100 a barrel ending the day at $99.26.
Domestic carriers also increased fares recently to Europe because of the new European law that requires airlines to pay for emissions from their aircraft.