NW Kills Price Hike, Keeps Fuel Surcharge Alive

A Continental Airlines-led across-the-board fare hike of $10 each way, meant to offset mounting fuel costs, was grounded when Continental partner and traditional price hike spoiler Northwest Airlines refused to fully match. A Northwest spokesperson, however, said the carrier did match the hike in select markets and for select fare types "where we thought it could be sustained." Northwest then pulled back those price increases over the weekend when competitors completely rescinded their fare increases across the board.

At last check, Northwest still had in place a $3 surcharge per ticket on routes competing against American Trans Air, which last night imposed the new fee. "Fuel costs have skyrocketed and all of us are in a position that we simply must do something," an ATA official said. ATA said its fuel surcharge is not applied for all Y and sale fares, meaning it is applied on less than half of all tickets it sells.

Though the other Big Six carriers had followed Continental's lead, the failure to raise fares on a systemwide basis and boost revenues is the latest in a string of derailed attempts in the past year. Yet, Terry Trippler, airfare expert at Cheapseats.com, expects a fresh attempt, possibly as early as this weekend. "It would not surprise me to see Continental come back with a fuel surcharge rather than a price hike," he said. Of course, for travelers, a fare hike and a fuel surcharge produce the same result: higher ticket prices. "It is all semantics, but Northwest for 18 months has stayed on the message that it is not the time to raise fares."