United's Fare Cuts Spread, Fueling Risk of Airline Price War
- Possible resumption of 2015 battle threatens industry earnings
- Southwest joins the fray: ‘You’re worse off doing nothing’
United Continental Holdings Inc. airplanes sit outside the company's hangar at Newark Liberty International Airport in Newark, New Jersey, U.S., on Wednesday, April 12, 2017.
Photographer: Timothy Fadek/BloombergThis article is for subscribers only.
A price battle between United Airlines and heavy discounters is spreading to other U.S. carriers, threatening to derail the industry’s nascent recovery in pricing power.
Competition that heated up this summer in United’s hub cities of Houston, Chicago and Newark, New Jersey, has extended to American Airlines in Dallas and to other carriers, airline executives said. Passenger revenue for each seat flown a mile, a proxy for airlines’ control over fares, had finally started rising this year after a slump triggered by a 2015 price war.