Saturday, January 10, 2009

Reuters, Friday January 9 2009 By Kyle Peterson CHICAGO, Jan 9 (Reuters) - Post-holiday fare sales offered by U.S. airlines are scheduled to last much

Post-holiday fare sales offered by U.S. airlines are scheduled to last much longer than usual this year, reflecting pessimism by those carriers about the economy and travel demand.
The sales, some of which extend into May, reveal a defensive posture by the carriers despite the just-completed holiday travel season that saw relatively high fares and full planes, said Rick Seaney, chief executive of air fare research site
"There's a lot of uncertainty about what's going to happen over the next six months," Seaney said.
The airline industry was battered severely in 2008 by soaring fuel prices and later by economic weakness that put a crimp in travel demand.
Despite financial losses, top carriers persevered because of large-scaled downsizing. The capacity cuts enabled airlines to retain the concerted, systemwide fare hikes issued in 2007 and 2008.
Base fares currently are about 15 to 25 percent higher for bigger U.S. cities than they were in the fall of 2007, Seaney said.
But the discounts are unusual, he said. Last year a typical air fare sale launched in January lasted into early March. This year, comparable sales are lasting as late as May as carriers try to ensure full planes in the spring.
"They're locking in some of the lower-cost seats for spring travel just to make sure they have all their bets hedged," Seaney said.
UAL Corp's United Airlines, for example, has offered a sale on some travel to Australia for trips as far out as April 30. Delta Air Lines has a sale on some trips between New York and Europe and the Middle East that take place between Jan. 12 and April 2.
AMR Corp's American Airlines has a sale on travel between Dallas/Ft. Worth and New Orleans that must be completed by April 30.
"We expect some type of fare sales. These sales are a little deeper and I'd say they are a lot longer than we normally would expect," said Terry Trippler at, a travel opinion website.
He said the alternative to long sales would be capacity cuts, which can be difficult for airlines ahead of the busy summer travel season.
"They could cut capacity further, but then they would have to bring it back in the summer," Trippler said.