Airlines' international growth hits headwinds
High fuel prices and weaker demand force airlines to limit int'l flight options.
— -- Runaway fuel prices and a weakening economy are forcing airlines to taper international expansion this fall, reducing the growth of new flight options from the USA to the slowest rate since 2003.
For October, airlines increased seats on non-stop flights from the lower 48 states to foreign destinations by just 1% compared with last October, a USA TODAY analysis of flight schedules shows.
Last year, they'd boosted seats by 5%, adding non-stop routes and frequencies to business destinations throughout Asia, the Middle East and elsewhere.
Yet, as oil prices continue to rise and pressure airlines to scrutinize their non-stop flight offerings, global business travelers are expected to suffer from fewer schedule reductions than jet-setting leisure travelers and U.S. domestic travelers.
"International business travelers really are the creme de la creme for airlines," says Chris Spidle, research director at Sabre Airline Solutions. "They typically are some of an airlines' highest-revenue travelers."
International airfares are also rising at a faster pace in October than domestic fares, which is helping the international market to outperform the domestic market so far this year, Spidle says.
According to a Sabre Airline Solutions analysis of fares bought through Sabre's computer reservations systems by June 30 for October travel, the average round-trip fare for an international ticket ($969) jumped 11.3% over a year ago. In contrast, the average round-trip ticket for a domestic flight ($309) cost 8.8% more than a year ago.
People who fly frequently outside the USA for business will also likely see fewer schedule reductions than other types of travelers for other reasons.
Airlines are generally reluctant to give up international routes that require more rigorous government approvals than domestic routes, Spidle says.
And airlines operate most international flights with larger jets, which provide better fuel efficiency per seat than smaller jets that fly within the USA, he says.
