Will 2009 Offer Fliers Deep Deals?

Oct. 22, 2008 — -- Here's an awesome statistic: Over the past 20 years, more than 100 million new passengers in the United States have been introduced to the convenience of air travel.

The catalyst for all this growth? Mainly, the relative prosperity of the United States coupled with the computer generation that fostered more efficient aircraft designs -- and let us not forget modern reservation systems, low-cost carriers, self-serve Internet booking and intense competition.

However, those wild growth days are gone -- at least for now.

Next year will usher in the era of air travel uncertainty -- with passengers and airline executives asking such questions as "Will the Dow be at 7,000 or 12,000?" or "Will oil be $50 or $150 a barrel?" The answers to these questions will play a large role in whether air travel ends up being affordable for most of us or a mode of travel mostly for the elite.

We do know this much: The pain of losing more than a decade of domestic U.S. aviation growth by the end of the year will be felt for the next decade. Airlines, their survival instincts kicking in, began slashing domestic flights this summer as oil prices appeared to be heading north of $150 for the foreseeable future.

But then, in a few short months, fuel prices dropped by half and U.S. airlines appeared on the brink of recovery. But of course, that didn't last thanks to the global economic disaster that may well dwarf the effects of any oil crisis.

So, given that we are in for some tumultuous economic times, and that oil appears to be settling in closer to $70 a barrel (instead of twice that amount), here are some of the air travel trends I expect to see in 2009:

Cheaper European Travel

While U.S. airlines have been steadily pulling seats from their domestic route systems in the past few years, they have also been progressively adding seats on more lucrative trans-oceanic routes.

More seats equals cheaper ticket prices.

The recent strengthening of the dollar against European currencies should also make lodging and activities more palatable for U.S. travelers (unfortunately for Europeans, the reverse is true for inbound flights).

Still percolating is this year's gold rush of flights to London's Heathrow, fostered by the first phase of the Open Skies pact inked in March, which removed red tape on air travel between the European Union and United States.

And American Airlines continues to push for a cozier relationship with British Airways. The U.S. airline, which recently ordered 100 new trans-oceanic Boeing 787 Dreamliners (to be delivered starting in three years), is seeking anti-trust approval to partner with British Airways for majority control of trans-Atlantic Heathrow routes, much to the chagrin of Virgin Atlantic's Richard Branson.

Plus, the new Delta-Northwest merger will be making a splash as well, with some introductory international pricing and possibly some new routes into Europe.

And consider that fuel surcharges have been averaging just under $350 roundtrip to Europe, even as energy prices have dropped like a stone. The U.S. airlines will have no choice but to succumb to the mounting pressure of international airline fuel surcharge rollbacks along with recent political pressure. Good news for those of you who've been postponing that trip to Europe.

Some Domestic Cities Have it Good

Sure, Southwest announced its "first ever" seat-cutback for early next year (this is an airline that typically grows by 6 percent to 8 percent a year), but the lower-cost carrier also announced new service to Minneapolis starting in March. While only one route has been set (between Minneapolis and Chicago), look for more in the latter half of 2009, which should drastically drive down prices for those in the Twin Cities.

Case in point: the cost of a ticket between Dallas and Houston is typically about $125 roundtrip for leisure travelers, while the route between Minneapolis and Chicago, just 100 miles farther, has a typical leisure fare of more than $400 roundtrip. Look for the price of this ticket, along with connecting traffic, to drop dramatically.

And San Franciscans who have had the best of it this year with ticket prices, may have it even better as Virgin America looks to expand in 2009. The most likely targets include a Midwestern city like Chicago or Dallas -- cities that will benefit big-time from the competition.

Finally, Denver saw an increase of nearly 100 daily flights from Southwest this year -- watch the city continue to reap those benefits in 2009.

Explosive Growth Down Under -- the Gulf

While U.S. aviation growth flattened during the past few years, the "final frontier" looks to be south -- south of the U.S. border, that is.

Latin America and South America have benefited from better economies and currencies pegged to the dollar during its unprecedented worldwide weakness, and these regions should continue to experience growth amid the domestic pull-back.

The international airlines in these areas have been profitable, while their northern brethren have bled red ink even as their ticket prices have bordered on the outrageous -- so look for more competition to bring these prices down in 2009.

Meanwhile, the new start-up airline, Azul, should take flight in early 2009. Azul, which will be based in Brazil, already has orders for more than 70 aircraft and it will introduce tens of thousands to the joys of air travel.

I would be remiss not to mention our friends north of the border as well. In late 2009, travel to Canada should get cheaper when the code share agreement between WestJet and Southwest kicks in. Watch for lower ticket prices to several popular Canadian destinations.

My prediction? I hate the term "cautiously optimistic" but frankly, in this case -- it applies. In 2009, yes, there will be pain but before long we will see the gain, as well.

This work is the opinion of the columnist and in no way reflects the opinion of ABC News.

Rick Seaney is one of the country's leading experts on airfare, giving interviews and analysis to news organizations, including ABC News, The New York Times, The Wall Street Journal, Reuters, The Associated Press and Bloomberg. His Web site FareCompare.com offers consumers free, new-generation software, combined with expert insider tips to find the best airline ticket deal.