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 Discount Airfare Deals
Hot Travel Trends for 2007
What to Expect at the Airport
 Poll: Will Airfares Increase This Year?
In travel, what lies just behind often dictates what lies just ahead, and what lies just behind for airlines is a yearlong stream of fare increases and merger frenzy among the nation's biggest carriers. What lies ahead? Let's say we're just getting started.
After months of bankruptcies and dismal financial filings, a couple of major airlines reported actual profits last week, or at least a better go of things. As has been the case throughout much of the economy, it has been generous consumer spending that driven the recovery. Prices have crept upward, but planes remain full; with fuel prices trending downward, all this should, by most folks' logic (although not always by airline logic), lead to profits. And profits should lead to better, or at least more stable, airfare prices.
Well, not necessarily. The airline business is far from stable, and much as the industry sometimes foolishly feeds consumer appetite for ridiculously low fares ($133 RT cross-country, anyone?), so they will test our willingness and ability to pay ever-higher base fares -- at least away from the highly competitive routes on which many airlines are willing to take a loss (and which they must subsidize with higher prices anywhere they can get them).
 Whither Airfares for 2007?
Airfares have trended upward for months now; airline experts noted at least 10 distinct across-the-board airfare increases in 2006. As I have said here, most fliers don't care about the $3 - $4 average amounts that usually mark these increases, but many recent fare hikes were in the $10 - $20 range -- do that a dozen times a year and customers will finally take notice.
And notice it they have; snagging the stellar airfare even on a popular high-volume route has become harder to do almost by the week over the past few months. Deals are still out there, but almost always on the least popular and least convenient flights, such as very early morning flights, grueling redeyes and time-consuming connecting flights.
For example, a recent search on several short and long-haul routes produced a late riser's nightmare; for every hour past 7 a.m. that a plane was scheduled to take off, you could expect about a 50 percent increase in airfare, up to about 300 percent by mid-morning.
In my way of speaking, this translates to "flights you hate you can afford; flights you want you can't."
On the bright side, all of this should serve only to strengthen and even embolden the discount airlines, which are already setting the standard for sensible pricing and service levels. The major airlines' attempts to offer a "discount" product seem willy-nilly or misguided at best, and seem to try to end-run the "fair product at a fair price" that has made such a force of the discount airlines. For example, witness United's "bare fares" approach, where low-priced fares would no longer entitle you to check bags, collect frequent flier miles, obtain seat assignments, or enjoy any number of other typically routine services; these services would be available a la carte, for a fee of course.
My view of 2007: barring any cataclysmic events in the oil market, we'll see a series of small to modest price increases that will eventually test the tolerance of average fliers, and will abate only when travelers tighten their purse strings (a benchmark I believe is not so far off -- I have already opted out of two flights in 2007 due to poor flight choices). What we'll get instead are sporadic now-you-see-'em sales that are limited to a fairly small number of seats, and low fares limited to routes on which there is plenty of competition from majors and discounters alike.
How do the big airlines propose to bridge this disconnect? By getting even bigger, naturally; hence the recent merger mania in the airline sector.
Merger Scares
Where do mergers come in? United and Continental have been casting long glances across the room at one another, while US Airways, fresh out of bankruptcy protection (and with its merger with America West still incomplete on the operational level at least), made a hostile bid for Delta, which remains in bankruptcy.
That accounts for four of the Big Six airlines. Also-bankrupt Northwest sits in the position of possible Continental spoiler (a current relationship between the two could hamstring any Continental mergers). American, the only one of the six to post a profit in the fourth quarter of 2006, would seem poised to acquire or merge with Northwest or Alaska; rumors of an America-Northwest deal surfaced amid all the other speculation late in 2006. Delta, meanwhile, has eyes for Northwest; the whole thing scans more like daytime TV.
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