Future fare increases?
 

Per the BBC World Service this morning: https://www.bbc.com/news/business-60781625

IYO's, is this a non-story, expected, or something that will really wind up biting consumers hard? Compared to other folks on this board, I'm more of a casual flyer (3-4 int trips a year), so be curious to hear from folks in the know.

DL also mentioned increasing fares due to fuel costs in a conference a few days ago -- https://www.flyertalk.com/forum/delt...ch-2022-a.html

shouldn't surprise anyone who has even a whiff of awareness of what's happening beyond the screen in front of their nose

Absolutely not surprising at all. I wonder if it really will matter if it's a 10% increase, as the story seems to suggest.

The real news is demand, not the fuel prices. I've seen some markets bump fares by $5 or $10, which is fairly common since they tend to take a very gradual approach. Inventory, on the other hand, has been pretty ludicrous for some summer dates I have checked, which is inline with the story of record bookings.

I always struggle to parse news about "ticket prices" since no mainstream outlet would ever differentiate between fares and inventory, and regardless "ticket prices" are a combination of the two anyway.

From the article:

Delta is planning to introduce fuel surcharges on the international flights which account for about 35% of its business, and increase US ticket prices.

A fuel surcharge is based on fuel costs, not demand.

I think the prices of everything are going to go up a bit this summer.

Airlines always play a game here. The final price of the ticket is very market sensitive. They can add a fuel surcharge, but the total price is subject to demand so they need to adjust the base fare. That is why we had idiotic prices years ago where the base free was near $0 and the fuel surcharge was the main component of the total fare.

I might need to relearn the magic code language and revisit the "trick it" thread":-)

Back then, did travel agents earn commissions on the whole ticket cost or just the base fare? I wonder whether fuel surcharges, etc. were similar to resort fees in that the hotel or airline would pay a percentage of a lower number (and in the hotel cast, not award points on resort fees either).

They still exist (technically $.50 each way). D1 fares start at $153.50 base each way on JFK-LHR (carrier-imposed surcharges are $650 each way for J tickets).

https://cimg1.ibsrv.net/gimg/www.fly...dab10feb40.png

That would be awfully cheap for a JFK-LHR RT in D1.

I was indeed baffled by the claim of "introducing" fuel surcharges. My last D1 ticket had a YR of $1,400. A random ATL-LHR I pulled was $200 each way in Y (E/V class). No idea what the article thinks they're talking about.

So another way Delta is looking to increase fares is that revenue management is using married segment logic to drive pricing based on higher demand destinations. Here is an example of a flight I was looking at for the last week of April. One-way PHX-IND on Wednesday the 27th. So back-story is that that week in Indianapolis is the largest firefighting conference and show in really the world. Now there is availability in other fare buckets on red-eyes or itineraries with 3-4 hour layovers, but all of the daytime itineraries, with sensible connections are just selling full-fare J. But when you look at each segment separately there are plenty of lower fare buckets available to sell. Even looking up the routing on Expert Flyer, shows C and D class F available but DL.com is only selling full J.

https://cimg0.ibsrv.net/gimg/www.fly...f96f1d0394.jpg
https://cimg1.ibsrv.net/gimg/www.fly...e9263e97d7.jpg
https://cimg5.ibsrv.net/gimg/www.fly...b1248c4643.jpg
https://cimg8.ibsrv.net/gimg/www.fly...dbf86b6ff6.jpg

There are several other routes to other destinations I have searched that are showing similar pricing where only full Y or J are available on the full itinerary, but when you search the segments separately there are plenty of seats in lower fare buckets in both cabins. With spring break going on right now...I have seen a lot of this type of pricing out there with Delta.

Note EF inventory is accurate; J0FN is the lowest pricing fare when the flight is Y0, regardless of the inventory situation in First. Yes, married segments are responsible for the Y0, and yes IME Delta is particularly harsh about blocking through inventory like this.

Delta is planning? I’ve already paid a fuel surcharge this year.

Price signaling. Since companies can't legally collude, Delta is announcing to its competition (through the media) that it would like to add a fuel surcharge. Other airlines will either match, or refuse to match to gain market share.

If other airlines announce the same, Delta knows they will be able to make it stick. If other airlines announce that they are not going to do it, Delta might reconsider. This has happened before. Last time, no one took the bait and Delta never added on a fuel surcharge. This time, due to high demand, the other airlines might match.