Airfares likely to rise further

Airfares have already increased significantly over the course of the past several months and this trend is likely to continue in the near future. The Wall Street Journal predicts that if some of the major mergers in the US commercial airline industry go ahead as planned, these price increases are likely to accelerate, as competition decreases on certain routes. The cost air tickets has gone up more than 10 percent in the United States, over the course of a year, while inflation in the US stood at only 4 percent. Most recently, United Airlines confirmed that it would hike rates by an additional 5 percent in the coming weeks on all domestic routes, while Delta has announced a $20 increase to the fuel surcharge. As such, Delta passengers now pay upwards of $100 simply for fuel on some round-trip tickets.

Most industry analysts agree that major mergers in the US airline market would mean fewer available seats, less competition and more freedom for carriers when it comes to hiking prices. As such, consumers are likely to suffer, if some of these mergers go ahead.

Yet airlines seem to have little choice, other than to continue cost cutting measures. Over the past several years, carriers have tried to eliminate their growing losses by charging for in-flight meals as well as for a second item of checked luggage. Nevertheless, even these measures have failed to fully stem losses, as the price of fuel continues to increase on the world market. Increasing fares may, however, create a backlash against airlines on the part of consumers, who could consider other forms of transportation. Additionally, US regulators may choose to examine price hikes, if they get out of hand.

www.delta.com