Passengers Win While Airlines Lose in This Year’s Fare War
A United Continental Holdings Inc. jet prepares to land at O'Hare International Airport in Chicago.
Photographer: Tim Boyle/Bloomberg
For travelers, it’s been an airfare party this summer with many domestic flights cheaper than a nice bottle of wine. Chicago to Los Angeles can be had for $49, Dallas to San Francisco is just $40, and Denver to Dallas goes for only $25—barely enough for a quality pinot.
Airlines and their investors despise these fares, the result of a fierce pricing skirmish that has bickering carriers behaving like quarrelsome 3-year-olds: It wasn’t me, he started it! The fare fight reprises a similar battle that erupted two years ago, one that dented industry revenues for more than 18 months. Only this past spring did carriers begin to feel confident that their pricing power was gradually returning.