Northwest Joins Delta in Air Fare Hike

Northwest Airlines took the lead in matching a fare hike by Delta Air Lines on Friday, raising chances that U.S. air fares will increase across the board for the first time in more than a year.

Delta boosted its fares Thursday night--by 4% on standard excursion tickets purchased seven, 14, and 21 days in advance, and by 2% for business fares--and Northwest followed Friday morning.

Continental Airlines, American Airlines and America West Airlines quickly joined in. Other airlines said they were studying the moves.

Northwest’s fare hike was significant because it had held back from matching increases last year. Major carriers had attempted to raise fares more than a dozen times last year, only to retract them days later because Northwest failed to join in.

“This time Northwest elected to go with it, and every major airline is probably going to go along,” said Tom Parsons, editor of Bestfares.com, a magazine and Web site based in Arlington, Texas, that specializes in low-priced air fares. The move also boosted stock prices across the airline industry.

Analysts said the hike was prompted by the major airlines’ long stint of stable fares, as well as Northwest’s success in reaching a tentative agreement last weekend with its 18,000 members of the International Assn. of Machinists.

“That had been a very big stickler,” Parsons said. “But the agreement eases the way to raise fares to the public.”

The airlines averaged five to eight fare hikes annually between 1992 and 1997, and a fare hike is long overdue, analysts said.

In recent weeks, airlines have made several attempts to raise revenue. Two weeks ago, Continental attempted to lead a fare hike, but that effort collapsed after Northwest and TWA didn’t follow.

Delta earlier this month stumbled through an attempt to add a $2 surcharge on round-trip domestic tickets not purchased through its Web site. It quickly rescinded that effort amid a wave of negative response.

Parsons said the only way the fare hike won’t be effective is if Northwest rolls back its announcement, as it did last September when it was facing the threat of a pilots’ strike. But he said he doesn’t think that will happen this time.

The airlines’ fare hike would impact walk-up business trip tickets immediately, whereas leisure travel includes more levels of discounted fares, said Terry Trippler, a consumer advocate for 1travel.com, a Web site featuring low air fares.

A walk-up business flight from Los Angeles to New York on Delta bought before the hike cost $918, according to Trippler. Today that same ticket costs $936.