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American, others, try another fare hike

Early in the morning of June 11, American quietly put forth a $20 fare hike on about half its routes. United and Continental matched by the end of the day, and Delta issued what it called a “coincidental” $20 increase on a few hundred routes. US Airways and Northwest have also matched.

Now, you may recall reading something similar on earlier this week, following an attempted fare hike over the weekend, again led by American. You may also recall this fare hike failing, marking only the fifth time all year a price increase was unsuccessful.

So now American, along with a few cohorts, is trying again. CTO Graeme Wallace quite aptly describes this new hike as American “throwing spaghetti on the wall to see if this attempt will stick.” Indeed, the move carries a whiff of desperation, like a teenager repeatedly asking to borrow the car no matter how many times his or her father says no. Just because American (and, to be fair, the other airlines involved) was rejected a few days ago doesn’t mean it will give up trying.

Will the fare hike be a success? It’s too early to know. A few days ago, I said the failed weekend price increase suggested airfares might be maxed out, customers had been pushed too far, and airlines were worried about killing their ticket sales. If I’m right, it still didn’t stop these airlines from attempting to raise fares again.

But the real test starts now, as we watch to see whether or not this $20 jump can hang on. If it does, I think we’re back to business as usual.

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