Major Airlines Raise Fuel Surcharge

21st Oct 2004

Rising jet fuel costs have
prompted most mainline US air carriers to raise their leisure airfares an
additional $10 per roundtrip for the third time in less than 30 days, says
Tom Parsons, CEO of, a travel information web site. American, Northwest, United and Delta are among carriers implementing this
surcharge in the past 24 hours.

Most airlines also have raised airfares and fuel surcharges by $50 per
roundtrip to Europe, Asia, the South Pacific and select South American
destinations. The fee is $30 per roundtrip to Mexico, Central American and
other South American destinations.

“The major airlines this week are reporting hundreds of millions of
dollars of red ink in a quarter that should be a guaranteed profit maker,”
says Parsons. “The total dollars lost could exceed $1 billion for the peak
summer travel quarter alone.”

The culprit for the fare hikes and surcharges is the high cost of jet
fuel, which after labor is the second highest expense the airlines face.
Fuel costs have increased from 88.9 cents per gallon at the beginning of
the year to just over $1.56 per gallon now, according to the U.S.
Department of Energy.

“The sad news is that the main group of travelers who now are being hit
with more than $30 more per roundtrip are the travelers who already pay
double or more than passengers who live in competitive markets that have
low-cost carriers,” says Parsons.


For example, today, from Syracuse, N.Y., to Orange County, Calif.‘s John
Wayne Airport, the cheapest roundtrip leisure fare is $419 roundtrip on
six of the old regime airlines. Drive 140 miles east to Albany, N.Y., and
the same six major airlines are forced to charge $198 roundtrip to stay
competitive, thanks to the presence of low-cost king Southwest Airlines.

“That’s a whopping difference of $220 roundtrip,” notes Parsons. “A family
of four could save over $880 for taking a two-hour drive. And guess what,
they do.”’s Tom Parsons, one of the most sought-after travel industry
experts in the United States, has been chasing down hidden travel bargains
and bringing them to the traveling public for more than 20 years. Parsons
regularly appears on ABC’s Good Morning America, NBC’s Today Show, CBS’s
The Early Show, CNN, Fox News Channel and MSNBC.


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