Airfares on most routes are lower this summer

By
Gary Stoller, USA TODAY
June 29, 2009, 9:36 PM ET
3 min read

— -- Trying to attract passengers in a recession, airlines are selling tickets much cheaper than a year ago.

Fares for travel next month are as much as 63% lower than last summer, according to an analysis by FareCompare.com.

At USA TODAY's request, FareCompare analyzed all domestic fares for flights between the hub cities of legacy airlines United, uaua American, amr Continental, cal Delta daland US Airways. lcc The fares were valid Friday for travel in mid-July with a 14-day advance purchase.

The analysis found that the cheapest round-trip coach fares were less expensive this summer for 115 of 136 pairs of cities. In 54 city pairs, the cheapest tickets were at least 25% lower than a year ago.

The biggest reduction was the fare between Cleveland and Detroit — down 63% to $244, compared with $657 last July.

Other routes on which airfares dropped at least 50% include Houston-Salt Lake City, Dallas-Washington and Detroit-Minneapolis-St. Paul.

"The drop in fares for more than 80% of the routes surveyed is certainly welcome news for late-buying summer travelers," FareCompare.com CEO Rick Seaney says.

Airfares hit the ceiling last summer and fall, when passenger demand was higher and airlines were hit with record jet-fuel prices. Jet fuel cost $4.03 per gallon in late June 2008, compared with $1.84 per gallon last week, the Energy Department says.

But sluggish passenger demand is the No. 1 reason for this summer's lower fares, American Airlines spokesman Tim Smith says.

"The driving force for recent fare levels in the marketplace is good old supply and demand, even in the face of reduced capacity," Smith says. "Overall traffic is down year-over-year and has been for several months, driven predominantly by our recessionary economy."

U.S. airlines' passenger revenue declined 26% in May, and the number of passengers fell 9.5%, compared with the same month last year, according to the Air Transport Association of America. It was the seventh-consecutive month in which passenger revenue fell.

Trying to boost its revenue, American last week increased round-trip fares $20 in domestic markets, and other airlines quickly matched. The move followed a June 9 fare boost by Delta that also was matched by competitors.

Seaney says the moves follow many months of airlines "trying to get butts in seats by discounting the heck out of tickets." Consumers looking for a bargain fare might want to book now, he says, before prices increase further.