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Travelers Face Higher Ticket Costs, Fewer Routes

Posted on: Monday, 5 December 2005, 21:00 CST

By Julie Bisbee, The Daily Oklahoman

Dec. 4--When Michael Joseph travels with his family at Christmas, they avoid high prices by booking their trips early.

Passengers will see more random screenings of their belongings and clothing, including wanding, screening shoes for explosives and pat downs.

This year Joseph, an Oklahoma City attorney, will spend a week in Cancun with his wife and four children. "Everybody has different schedules, so this is just a great time of year for us to travel," Joseph said. "We can all be together."

Joseph and his family booked before Hurricane Wilma hit the Mexican coast. They are taking their trip anyway.

"I'm a little concerned, but we've been told that the place we are staying in is in order," Joseph said. "We've had several sources tell us it wasn't damaged by the hurricane at all."

Whether it's a trip to Cancun or Grandma's house, travelers who haven't yet booked Christmas airfare might have a tough time finding a bargain. In the last month of the year, many airlines are working to make up for losses and turn a profit on the crush of Christmas travelers, analysts said.

Getting back into the black after years of losses is going to be difficult as airlines continue to battle high fuel prices. What that means to consumers is a steady increase in the price of tickets.

And the price of tickets in 2006 will likely mirror more costly fares seen around the holidays. The price of a domestic ticket is expected to increase by 3 percent to 6 percent, according to analysis by American Express Business Travel, a division of the American Express Company that tracks travel trends.

Since 2001, the airline industry has lost nearly $34 billion, according to industry figures, and four major airlines are under bankruptcy protection. In order for airlines to recapture their losses, they will have to make seats on airlines scarce, analysts say. Airlines are cutting back on the size of their planes and getting rid of some routes in an effort to cut fuel prices. They are charging for meals on planes or doing away with them altogether in order to cut down on operating costs.

Earlier this year, Delta Airlines cut back on flights and opted for smaller airplanes in some markets. In May, Delta turned over its Tulsa service to regional carrier Atlantic Southeast Airlines.

American Airlines also slimmed down its flight schedule for about a month this fall to cut down fuel usage. This comes as Americans are traveling in record numbers that rival figures before the Sept. 11, 2001, terrorist attacks.

But airlines aren't going to make money if they continue to compete with slashed fares of low-cost carriers, said Ray Neidl, airline analyst for Calyon Securities.

"Traffic is strong, but fares aren't going to be enough to offset losses," Neidl said. "You're going to see fares going up, but it's still going to be a bargain for consumers."

In large markets, most airlines are competing with cheap domestic fares from carriers such as Southwest Airlines. At Dallas's Love Field Airport, the battle for the lowest price began as Southwest started offering $79 one-way tickets to airports in Missouri, just days after President Bush signed a bill that allows long-haul flights to Missouri airports.

American Airlines, which now has three gates at the central Dallas airport, matched the fare.

"Airlines need to fill planes, but they have to be at the right fares. Right now they are filling planes by selling tickets at give-away prices," said Terry Trippler, an airline analyst for cheapseats.com. "The airlines have to sell high load factors, but they've got to sell the seats at a profit."

Experts agree the best way to get good fares for upcoming travel is to plan ahead. Airlines are often offering cheaper fares months in advance. Last-minute fares also can be a way to save money as airlines scramble to fill up planes.

"You can still get good fares for Christmas travel," Trippler said. Busy Christmas travel days are often Dec. 22 and 23, and Jan. 1 and 2. "Outside of those days you can probably still find something."

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LUV,

Source: The Daily Oklahoman

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