American, Delta, Northwest, and United Airlines have rescinded their fare hikes citing efforts to stay competitive after other low cost carriers did not match the fare hikes. 10/30
Are low cost carriers hurting the legacy carriers? It looks like price cuts at the legacy carriers in order to compete with the LCC's are catching up with them. United Airlines and American Airlines, which matched United, have cited fuel prices as a reason for the recent fare increases on select markets.
United Airlines raised prices on routes where it competes head to head with discount carriers such as Chicago to Dallas and Atlanta, and Denver to San Francisco, Los Angeles and New York. But on routes where United competes head to head with low cost carrier Southwest Airlines fares were to remain unchanged.
Credit Suisse airline analyst Daniel McKenzie said in a note that the move by United, which follows an unsuccessful attempt last week by AMR, parent company of American Airlines, and Delta Air Lines Inc. to start an industry-wide fare increase, is "a sign that underlying demand trends remain strong."Northwest, US Airways and Continental have not said they whether or not they would match the increases but said they were studying the possibilities of fare increases.
WCCO.com
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