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The Honolulu Advertiser
Posted on: Wednesday, December 31, 2003

Bargain airfares apply after holidays

By Melissa Allison
Chicago Tribune

CHICAGO — U.S. airlines have launched their annual after-holiday sales, but at least one expert questioned the wisdom of such pricing tactics.

"These are extraordinarily attractive fares," said Joseph Schwieterman, a transportation expert at DePaul University in Chicago.

However, he said it is becoming more difficult for major airlines to attract customers with such sales.

"Everybody's conditioned to finding low fares on the Internet, and they have come to expect rock-bottom prices," Schwieterman said.

He also said carriers — particularly mainline airlines — would build more loyalty if they offered more predictable, stable pricing. Low-cost carriers such as Southwest Airlines tend to have more consistent pricing, even when they offer discounts.

"Airlines need to walk away from these extreme discounts and simply lower capacity," Schwieterman said.

Price stability could lead to higher revenues for airlines. Without the deep discounts, Schwieterman said, "many travelers would buy higher-fare trips sometime in the future."

Yesterday, United Airlines slashed fares on tickets bought by Jan. 16 to cities around the world. Round-trip tickets between Chicago and Boston have fallen to $158; Chicago-Los Angeles went down to $198; and Chicago-Dublin is $258.

As with most sales, the fares are available only if customers buy round-trip tickets and they include fees, taxes and certain limitations.

On Monday, American Airlines cut its fares to include round trips between Chicago and Fort Lauderdale, Fla., as low as $272, and between Chicago and Aruba for $406.

Even Southwest Airlines, known for low prices on regular fares, announced a sale to "help customers relax after the holidays by escaping to their favorite destination."

Southwest's post-holiday bargains will be on sale through Jan. 19 for customers who book tickets on the Internet. The Southwest fare deals — ranging from $78 to $278 for round trips — vary depending on which days a customer travels.

Airline fare sales happen every year after the holidays, when people are least inclined to travel. The greater number of passengers attracted by the deals would make up for the lower prices.

"We feel like our fare sale will help fill empty seats during a season with typically low demand," said Tim Wagner, an American Airlines spokesman.

Martin White, head of marketing at United, said his airline also wants to encourage vacationers to travel by air, something that leisure travelers have only recently begun doing again after the shock of Sept. 11.

Because vacationers are flying more often, United has begun to focus again on the leisure market. It recently launched routes to sunny spots including Grand Cayman, Mexico City and San Juan, Puerto Rico, from Chicago and Washington Dulles.

Consumers can expect more discounts during the coming year — typically for the summer and holiday travel seasons — but none as steep as the midwinter sale.

After Sept. 11, airlines began discounting fares for summer travel.

"Before September 11, people booked far out. Since September 11, they do not," said Darryl Jenkins, visiting professor of airline management at Embry-Riddle Aeronautical University in Daytona Beach, Fla.

In April. the airlines "may get nervous and start testing different fares to see if it will pick up," he said.