Sky Talk

Southwest, others, join Delta-Northwest in fare hike

Delta-Northwest is getting some company in its $10 roundtrip ($5 each way) fare increase, launched Thursday night across the bulk of its U.S. system.

Rick Seaney of farecompare.com says Southwest Airlines, and Alaska, Midwest, and Frontier airlines have significantly matched. US Airways has "selective matching," and United Airlines is "dabbling in some limited matching."

"American and Continental (are) on the sidelines so far," Seaney reports.

Southwest's increase was $5 each way on mid and long-haul routes, and $2 on short haul routes, outside of sale fares, Seaney said.

"It is very difficult to get an exact read on this hike, as there was some late-week off-peak travel discounting that is mixed in with the increase activity," Seaney said. "Typically, we will know if the hike attempt sticks by Monday afternoon."

"It appears at this point that the hike has a very good chance of surviving," he said. "I have never seen an airfare hike in four years fail when Southwest Airlines was in the mix."

- Scott Nishimura

Delta, Northwest, launch $10 roundtrip fare hike

Airlines are trying to raise fares again.

Thursday night, Delta Air Lines and Northwest Airlines launched a $10 roundtrip ($5 each way) fare increase across the bulk of their U.S. systems, says Rick Seaney, of farecompare.com

"This domestic airfare hike marks the third attempt in the past six weeks, with the past two tries successfully sticking," Seaney said.

He noted that American Airlines CEO Gerard Arpey said Wednesday that he figured AA needed another $17 per one-way customer to break even.

"If this domestic airfare increase sticks, it would mean an increase of $20 to $25 each way domestically for the legacy airlines in the past six weeks," Seaney said. "However, this increase does not include international tickets, nor the widely matched off-peak late summer/fall airfare domestic sale initated by Southwest earlier this week."

He continued:"Starting this past November through late May of this year, airfare prices had been in a free fall. In June, domestic airlines popped their chutes with a couple of airfare hikes. The big question is whether or not there is a hole in the canopy, as demand in tough economic times is impossible to predict."

-- Scott Nishimura

Still more baggage fees emerging

Delta announced recently that it would begin charging $50 to check a bag on international flights - a perk that used to be free. Now US Airways says it will charge an extra $5 per bag to pay luggage fees at the airport during check-in rather than in advance online.

US Airways already charges $15 to check the first bag, and $25 for the second.

- Trebor Banstetter

More bag fees at Delta

Delta announced this morning that it will begin charging $50 to check a second bag on international flights. Airline officials estimate it will raise about $100 million annually. Delta is the first airline to charge a fee for a second international bag, which had previously been free. It will go into effect on July 1.

Most of the major carriers, except for Southwest, began charging checked baggage fees on domestic flights last year. Don't be surprised if other airlines jump on board with their fee for those bags.

- Trebor Banstetter

Airline stocks jump on Delta, United earnings

Delta reported a first-quarter loss of $794 million, and United said it lost $382 million, but airline stocks nonetheless jumped in early trading. The losses for both airlines were smaller than the first quarter of 2008, and there was some hope that revenue declines have stabilized.

"We’ve seen some signs of stabilization as the revenue environment appears to have bottomed out," Delta CEO Richard Anderson said during the airline's conference call this morning. "But it's still too early to call, and we expect to face headwinds throughout the reset of the year."

At about 9:30 CST, Delta shares were up about 13 percent; United shares up 7 percent; AMR shares rose 6 percent and Southwest stock was up 3 percent.

- Trebor Banstetter

Analyst optimistic about Delta

Airline analysts have been slashing their estimates for 2009 airline earnings in recent weeks, given the sharp drop in passenger traffic. But this morning, Michael Derchin of FTN Equity raised his forecast for Delta Air Lines, from an estimated profit of $1.71 per share to $1.95 per share.

He's predicting that while revenues will be lower than initially forecast, fuel prices will be down as well. And Derchin was encouraged by Delta's plans to cut back its international passenger capacity by 10 percent.

Delta's stock, which Derchin rates a "buy," was trading at $4.67 per share early Thursday, down 13 cents.

- Trebor Banstetter

Delta, Midwest expand alliance

Delta Air Lines and Midwest Airlines said this morning that they're expanding an alliance that will include reciprocity between frequent flier programs, joint marketing efforts and expanded access to airport lounges throughout North America.

The deal basically extends Midwest's alliance with Northwest to Delta (which acquired Northwest last year). Northwest was a minority investor in Milwaukee-based Midwest, a small airline that has an extremely loyal following.

- Trebor Banstetter

Delta, Northwest traffic down

Delta and its new subsidiary, Northwest, reported declines in traffic for January - not surprising, given the plunge in demand for travel.

Delta's domestic traffic was down nearly 7 percent, and its overall traffic dropped by about 2 percent. Capacity was down by just under 2 percent systemwide, so aircraft passenger load factors edged up slightly.

Northwest, meanwhile, saw a sharper drop, with domestic traffic down 10 percent and total traffic declining by 8 percent. That was ahead of the airline's 6 percent capacity cut, so passenger loads dropped a bit during the month.

American and Southwest have also reported significant declines in passenger traffic.

- Trebor Banstetter

AA pilots praise Delta ASAP deal

Officials with the Allied Pilots Association, the union for American Airlines pilots, recently praised the new ASAP safety program that was reinstated at Delta. American's ASAP expired last year and has not been renewed despite calls from the FAA to reinstate the program.

ASAP, which stands for Aviation Safety Action Partnership, allows pilots to report certain safety-related incidents without risking discipline from the airline or the FAA.

Keep reading for the union's message to American pilots regarding Delta's ASAP program.

- Trebor Banstter

Delta posts huge loss, shares plunge

Delta Air Lines reported a $1.4 billion loss today on fuel hedging costs and expenses related to its merger wtih Northwest. The airline's stocks are currently down $1.73 to $8.20 per share, a drop of more than 17 percent.

- Trebor Banstetter