2013 Travel Predictions From an Airline Expert

PHOTO: In this Dec. 21, 2012, file photo, travelers walk in front of an United Airline flight information screen at OHare airport in Chicago.
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Did you hear about one man's bizarre way to avoid overweight luggage fees? Before his flight from China, he somehow managed to dress himself in just about everything he owned, including 60 shirts and 9 pairs of pants.

Not sure how he worked it out with his shoes, but it just goes to show that saving on airline fees is an international obsession.

Which brings me to my first air travel prediction for 2013. I've dragged out my crystal ball and here's what I see (and be sure to check out my last prediction -- it's something fun for all of us).

For more travel news and insights view Rick's blog at farecompare.com

Fee Bundle Mania

It's not that airlines are raising fees; they'll actually lower some but you may wind up spending more. Confused? It's all about the bundling; airlines will package two or more fee-based services and discount the bundle. Maybe you only want one of the services but you may have to take the "bundle."

American did this last month with its Choice Essential and Choice Plus options (airlines love buzzwords like "choice"), which provide such options as early boarding and a free bag. Delta has something similar with its Lift and Ascend programs, which also began in December. Both can be great for frugal-minded business travelers who want some of the comforts of business class without the steep price tag, though I suspect the vast majority of vacation flyers will exercise their right to choose no fees at all.

A Merger, Maybe

In early 2012, as American Airlines was just beginning its slog through bankruptcy, a merger seemed unlikely; AA sure as heck didn't want one. But times and circumstances change, and by summer a merger looked like a 50-50 proposition. I now think after American emerges from bankruptcy a union with US Airways is highly likely (let's say I'm nearly 70 percent sure it'll happen). If it does, watch for it to happen soon.

Higher Ticket Prices? Positively

No surprise here, really. For one thing, a merger means less competition, and as we all know, healthy competition is key to keeping prices down. In 2012 there were seven successful airfare hikes (one launched by Delta, the others divvied up between Southwest and United) and I expect to see at least as many this year.

Oil is one reason for more hikes; I don't expect the price of a barrel of oil to drop to levels where the airlines could lower prices; oil would have to be in the $70 to $75 range, down from its current $92. Plus it would have to stay in that range for about four to six months in order for airlines to really feel it in lower jet-fuel bills.

By the way, one reason airlines want to raise some ticket prices is that they're already dirt cheap. Skeptical? Consider that a winter flight to Europe goes for around $750 to $800 round-trip. About $450 of that cost is a fuel surcharge and another $150 or so is for government and airport taxes, so the cost of the airfare itself can be less than a hundred bucks each way!

Finally, there's the matter of demand for air travel. At larger airports it's been holding relatively steady and when people want to fly, there is no incentive to drop ticket prices. If you're looking for a silver lining, I suppose you could say the economy is on a better footing so more of us can afford higher ticket prices.

Smaller City Blues

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