Big Airlines Hit Business Travelers

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It was simply a matter of unfortunate timing that those four carriers tanked in the same week. But in response to the unrelated failures, the six network carriers pulled out an assortment of old and failed pricing tactics. They increased the “minimum-stay” restriction on some prices, to force business travelers to buy higher fares to secure the travel flexibility they need. Five of the six airlines are now charging $25 for a second checked bag. (The lone holdout, American, is likely to match the new one-free-bag standard.) Several carriers raised so-called nuisance fees on items such as frequent-flier award redemption and itinerary changes.

The big airlines also raised their fuel surcharges again, a tactic cynically aimed at business travelers. Surcharges are piled atop a business traveler’s fare and do not qualify for any negotiated corporate discounts. On some international routes, the surcharge now exceeds $300 roundtrip.

Airlines insist that these new pricing gambits are necessary to cope with higher oil prices, but consider the state of fares since the New Year. Prices have already risen at least six times in the last 90 days, says Rick Seaney, whose FareCompare.com obsessively tracks airline-fare patterns. Seaney adds that prices charged by at least one carrier, Northwest, have jumped by as much as $120 roundtrip since the beginning of the year.

What will business travelers get for all these increases? Less service than ever before, according to the big airlines. Each of them plans to reduce their domestic route networks by as much as 5 percent by the end of the year. That means fewer opportunities for business travelers to fly with them, which will further reduce revenue, thus extending the fear-and-loathing cycle into next year.

The Fine Print…

The big airlines’ fare structure continues to be inexplicable. If you want to fly from New York to Los Angeles today, one-way fares on the 2,475-mile route are as low as $379. That’s less than 16 cents a mile. But the 374-mile flight between Atlanta and Cincinnati costs $734.50 one-way. That’s a staggering $1.96 cents a mile.

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