Fuel surcharges get added onto the bottom line, but they have more of a bite on business travelers than standard fare increases because generally, negotiated corporate discounts don't apply to fuel surcharges.
And no, though the major airlines appear to be acting in collusion, they actually all don't get in a room and fix prices. They don't have to do that anymore! Haven't you heard of technology? Don't you know there's a war on?
Anyway, here's the latest update from Rick Seaney at FareCompare.com:
""Thursday, April 17, 2008 12:15pm CDT
Starting early Wednesday morning the legacy airlines began to match the United Airlines fuel surcharge increase of an additional $10-$20 roundtrip initiated late Tuesday evening, in order:
· US Airways matched only at the $20 roundtrip level
· Delta Air Lines matched at the $10 and $20 roundtrip level
· Continental matched only at the $20 roundtrip level
· American matched only at the $20 roundtrip level
· Northwest Airlines just matched at 12:30 today
All matching was across their respective route systems, while continuing to tip-toe around low cost airline routes and the very cheapest promotional leisure airfares flown by the fewest passengers.
A few of the airlines, didn’t bother with the $10 increase level and opted for $20 roundtrip across the board. This brings the domestic fuel surcharge for many markets to $70 roundtrip from its previous high of $50 roundtrip.
I was skeptical that this increase would stick given the two scuttled attempts by Delta in late March and the base airfare increase of up to $30 that was widely matched this past week, but it seems the price of oil coupled with comfort on summer demand along with the announced capacity cuts are providing an environment where the airlines feel comfortable with this new increase – for the moment.
I will wait until early next week to call this increase a “success” leaving our 2008 airfare hike time line as follows:
1. January 3rd, initiated by United, $10 roundtrip, successful (sticky)
2. January 11th, initiated by United, $30 roundtrip, unsuccessful
3. January 17th, initiated by American, $20 roundtrip, unsuccessful
4. January 24th, initiated by Continental, $20 roundtrip, successful (sticky)
5. February 22nd, initiated by United, $10 roundtrip, successful (sticky)
6. February 28th, initiated by Delta, $10 roundtrip, successful (sticky)
7. March 7th, initiated by United, $10 roundtrip, successful (sticky)
8. March 14th, initiated by United, $4-$50 roundtrip, successful (sticky)
9. March 19th, initiated by Delta, $10 roundtrip, unsuccessful
10. March 27th, initiated by Delta, $10 roundtrip, unsuccessful
11. April 9th, initiated by United, $4-$30 roundtrip, successful (sticky)
12. April 15th, initiated by United, $10-$20 roundtrip, pending – fully matched as of noon today