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A pattern is emerging in the pricing of airplane tickets which will make planning your leisure travel more tricky than previously: higher fares, more sales.
As I write this, on Wednesday, Oct. 26, United Continental and Delta Air Lines have hiked their domestic fares for the second time in two weeks. The previous, started by Delta, was matched by such discount carriers as Southwest and JetBlue, so it stucks. United and Delta executives are now waiting to see if their modest new increases, $5 or less on most routes one-way, will be matched by the discounters. If not, they will probably have to roll it back.
Nothing new there. But what is new is that airlines seem to be simultaneously raising base fares and doing more fare sales. I've been telling people who want to know if they should book their Christmas travel now that, yes, they should, because fares could rise more between now and Christmas. But it also appears that consumers might experience more fare sales opportunities, though I seriously doubt that Christmas week won't be blacked out.
This is revenue management. You raise your prices so a nicely profitable level, precisely so that you can cut those prices and remain profitable when you sense a slack period. The fare sales are designed to fill the unsold seats, which is why I don't see it happening for Christmas travel: there won't be any unsold seats.
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