NPR Story
3:00 am
Tue March 6, 2012

Airline Fares Tick Higher

Transcript

RENEE MONTAGNE, HOST:

OK. And we all noticed rising costs at the gas pump. But those costs will also mean rising prices for airline tickets.

As NPR's Annie Baxter reports, that's already happening.

ANNIE BAXTER, BYLINE: If you've been looking for a great deal on airline tickets recently, you've probably been disappointed.

BOB MANN: Carriers have raised prices successfully twice, so far this year and that's out of four attempts. And I would expect another attempt literally within in a week.

BAXTER: That's airline consultant Bob Mann. He says carriers have ways to reduce their exposure to higher prices by locking in fuel at a fixed cost in advance, a process called hedging. But Mann says carriers never hedged 100 percent. So a spike in the cost of fuel, which is an airline's biggest line item of expense, usually translates to higher fares. And since Mann thinks fuel will only get costlier, he says it's best to book flights as soon as possible, before fares shoot up more.

But Rick Seaney, chief executive of the travel website FareCompare.com, disagrees somewhat. He says don't watch sites like his hawkishly for any hint of fuel-related price spikes for all your travel. Seaney says hurry to book if you're traveling in the next month or so. But for summer travel, he says it's best to shop about three months in advance.

RICK SEANEY: That's when airlines start releasing some of their cheaper seats to test to see how the booking environment looks.

BAXTER: Seaney says fares in January were already up nine percent from the year before. He thinks some travelers will get fed up with those rising costs and drive or take a train instead. But he says airlines can probably bank on business fliers suffering the price increases without too much pushback.

Annie Baxter, NPR News. Transcript provided by NPR, Copyright National Public Radio.

Related Program