TWA Triggers Round of Fare Reductions : Travel: Cuts of up to 35% on domestic routes are immediately matched by other airlines.
Airlines slashed ticket prices for domestic travel by up to 35% on Tuesday, marking the second major fare discounts announced this week.
Trans World Airlines kicked off the latest round of fare cuts late Monday by announcing it would slash ticket prices for travel by May 15.
American Airlines, Delta Air Lines, United Airlines, Continental Airlines, USAir and America West said they would match the TWA discounts on competing routes.
TWA said the sale covers travel in the continental United States, Hawaii and San Juan, Puerto Rico. But consumers must act quickly because the sale ends Friday.
TWA said sample round-trip fares under the latest cuts are $408 for New York-Los Angeles, compared to a pre-sale price of $628; $366 for St. Louis-San Francisco, compared to $563, and $259 for Chicago-Dallas/Ft. Worth, compared to $398.
On Monday, major airlines matched a weekend 30% fare cut initiated by partners Northwest Airlines and KLM Royal Dutch Airlines for international travel. Tickets for the overseas sale cover travel between April 1 and Oct. 31.
Northwest on Sunday unveiled the fares on tickets to 80 destinations in Europe, Africa, India and the Middle East. They must be purchased by Feb. 11--for Europe by Feb. 28--for travel between April 1 and Oct. 31.
Northwest and TWA have both been market pacesetters in cutting fares, and most other carriers have typically been forced to follow their lead to be competitive.
Fare discounts of 30% to 40% are not terribly detrimental to airlines’ revenues, however, because the base fare level has crept up substantially over the past year.
Airline sources said that while the latest round of discounts is unlikely to cut sharply into revenues, they will put more pressure on major carriers to slash expenses in 1994 in an effort to compete with low-cost and niche-market rivals.
“Many of the low-cost and new entrants are driving pricing in the industry. Our challenge is to get our operating costs in line,” said Tim Smith, spokesman for AMR Corp., the Dallas-based parent of American Airlines.
Northwest and TWA underwent major restructurings in 1993 that set their costs far below those of their rivals and allow them to initiate fare discounts during traditionally sluggish travel periods.
“We think this will stimulate spring traffic,” TWA spokesman Don Fleming said.
