Rising energy prices causing airline fare increases

Standard costs of airfare tickets have gone up. This is the sixth time airlines have increased their costs since January. This particular increase in fares is unusual because Southwest was included. Southwest is typically the holdout on these fare increases. The rise is being blamed on rising oil prices.

The rising price of an airfare ticket

There was a $60 boost this year in the average airline ticket costs, in accordance with airline industry reports. Now, a ticket that would have cost $200 on Jan 1, 2011 will cost $260. When it comes to increases in price though, not all airlines had these increases. Unless all airlines raise costs, the increases usually go back down. This latest $10 increase, however, was followed by Southwest Airlines, traditionally a holdout.

Fuel costs for low-cost airlines

Southwest Airlines are one of several low-cost airline carriers in the United States. Traditionally, Southwest Airlines has avoided many of the fees and rate hikes that larger airlines have undertaken, in an effort to keep consumers. Other economy service providers will keep prices low too. This consists of JetBlue and AirTran. The lower profit margins aren't good all the time. There is more price volatility due to it. When the price of a barrel of oil goes up by $10 to $20, the airlines often raise their per-ticket price by a similar amount. The CEO of Southwest pointed out that Southwest will likely spend $1.3 billion on fuel in 2011, which is three times the total net income of Southwest last year.

Going everywhere costs a lot

As airlines are raising their fares, travel in the U.S. in general is getting more costly. There are not very many opportunities for individuals traveling long distances. Airlines are the most obvious. Driving is also a choice, though the rising cost of gasoline can often put the price of a long-distance trip relatively close to that of an airfare ticket. The rising oil costs are leaving even bus trips more expensive. Now, a train ticket would cost $150 that cost $50 in 2008 while there are not many opportunities for travel even though it is an option. High-speed rails are still more theory than practice.

Articles cited

WSBTV

wsbtv.com/news/27110644/detail.html

USA Today

travel.usatoday.com/flights/post/2011/03/another-day-another-fare-hike/146578/1

News OK

newsok.com/fuel-costs-force-southwest-to-add-10-to-ticket-cost/article/3546778