United Airlines initiated a fare increase on Wednesday 30-Dec-2009, according to FareCompare.com. The increase, matched on New Year’s Eve by other network airlines, comes as oil prices have spiraled again above USD80 per barrel. United hiked fares between USD6 and USD10 covering over 15,000 city-pairs – the bulk of its domestic network. On New Year’s Eve, the remaining network airlines began to match, including American, Delta/Northwest, US Airways, Continental and Alaska. Exempt were a variety of fare sales for travel through to early Mar-2010, as well as routes that compete with LCCs which have spurned the hike. FareCompare.com noted that the eleventh-hour hike was the fourth successful increase since mid-2009. The industry increased fares 15 times in 2008 and 17 times in 2007.
US fare hikes to usher in the New Year
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Delta Air Lines closes in on Korean Air JV to boost Asia network, hedge China Eastern partnership
Delta Air Lines is rekindling its partnership with Korean Air. Delta has previously used heavy-handed tactics – cutting off codeshares, nearly eliminating reciprocal frequent flyer benefits otherwise enshrined in their SkyTeam alliances – to bully Korean Air into a JV. The attraction to Delta is a JV partner in Asia, which American and United have long enjoyed.
Korean Air, until recently, has failed to see the benefits of a partnership with Delta, which has a smaller trans-Pacific footprint. Although Korean Air felt the damage from all but losing its North American partner, what Delta needed to give Korean Air was time. It has helped that Delta is no longer pursuing a hub in Tokyo – a rival to Korean Air and Seoul.
A deeper Delta-Korean Air partnership, as hinted at by Delta management in Dec-2016, starts with both feeling competitive trans-Pacific pressure but jointly holding a position of strength, with a JV slightly smaller than United-ANA's, but much larger than American-JAL. Korean Air brings wider coverage to Southeast Asia, as well as North American gateways.
Alaska and Delta: the end of a partnership, but the start of new competition on the US west coast
A decision by Alaska Air Group and Delta Air Lines to dissolve their codesharing partnership in late 2016 was not surprising, given that the demise of their relationship began about four years ago when Delta opted to build Seattle into a strategic trans Pacific hub. Since that time the financial benefit Alaska has enjoyed from the relationship has dwindled as Delta has built up its own network in Seattle to feed its long haul flights, rather than rely on passengers from Alaska.
After the two airlines formally announced their split: through the planned launch of seven new markets from the airport in 2017 Delta sent a clear message that it had no intention of backing down in Seattle, breaking an Alaska monopoly in several of those markets. However, Delta’s international expansion from Seattle appears to be on hold until the airport completes a new customs facility at the airport in 2019.
Even as their relationship officially ends, competitive dynamics between Alaska and Delta will intensify on the US west coast as Alaska embarks on its merger integration with Virgin America. Alaska will find itself competing with Delta and numerous other airlines in the strategic and fragmented Los Angeles market, and the merged entity retains a solid presence on numerous key routes from the airport.