By DAVID KOENIG, AP Airlines Writer
DALLAS (AP) - Major U.S. airlines are raising the price of some tickets favored by business travelers again, this time by up to $120 per round trip.
Fare experts said Delta started the latest increase on Monday, which was matched immediately by American and a day later by United, Continental and US Airways.
It's the second big increase in fares in as many weeks. The airlines' fuel prices have risen 50 percent over the past year. They eliminated many flights when they were losing money in 2008 and 2009, which has given them the power to raise fares now that planes are more crowded and travel demand is rebounding.
JP Morgan analyst Jamie Baker said it made sense for the big airlines to target corporate travelers, who are considered less sensitive to price increases. He said airlines may have raised vacation fares as high as they can without causing a loss of revenue - presumably by driving away budget-conscious customers.
American Airlines spokesman Ed Martelle said the increases covered first-class, business-class and tickets purchased up to seven days before travel. Flights up to 500 miles were boosted $20 each way, those from 501 to 1,500 miles were raised $40 each way, and flights longer than 1,500 miles increased by $60 each way, he said.
"We're responding to the Delta initiative," Martelle said when asked why American, a unit of AMR Corp., was raising prices.
Delta Air Lines Inc. confirmed the fare hike but declined to give a reason. United, Continental and US Airways confirmed that they too raised prices.
Last week, United and Continental, owned by United Continental Holdings Inc., led an increase of $20 to $60 per round trip on pricey tickets typically bought by business travelers. Delta and American both matched that hike last week.
Rick Seaney, CEO of FareCompare.com, said that like last week's increase, the Delta-led boost on Monday was aimed mostly at high-end fares - about $800 per round trip - that typically are bought by corporate travelers, not vacationers.
Baker said low-fare airlines wouldn't be able to block this increase because the tickets are sold at prices far higher than the discount carriers were already charging.
Airlines also claim that demand for leisure travel will be hurt if passenger fees for security and airport improvements are raised, as President Barack Obama proposed in his budget this week.
The proposed increases would add a few dollars per flight to the cost of a ticket, but Baker said it could reduce revenue especially at airlines such as Southwest, which cater to price-conscious travelers.
(Copyright 2011 by The Associated Press. All Rights Reserved.)