Rival carriers follow United, drop $100 feec

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Rival carriers follow United, drop $100 fee
By Barbara De Lollis, USA TODAY

United Airline's financial troubles delivered business travelers a coup=20
this week. Continental and American airlines followed United in scrapping a=
=20
$100 standby fee for non-refundable tickets that they were going to start=20
collecting Jan. 1. The move is being heralded by corporate travel managers=
=20
and by business travelers who like to fly standby if their out-of-town=20
business finishes early or runs late. "It's nice to see them back off,=20
especially in our industry, where our schedules are dictated by clients,"=20
says Sheila Kittle, vice president of corporate travel at Raymond James in=
=20
St. Petersburg, Fla. Rosenbluth International Travel estimates that, on=20
average, one in 10 business travelers flies standby, though it varies by=20
industry. Airlines liked the fee because it was expected to drive more=20
business travelers into more flexible, higher-priced fares instead of the=20
more restrictive, cheaper fares that have grown in popularity. The drop-off=
=20
in higher-fare purchases is one factor in airlines' losses.

"This was a way =97 a sneaky way =97 to say, 'Hey business traveler, if you=
=20
want to have these fares, I'm going to make it just a little tougher for=20
you,' " says Michael Boult, chief operating officer of eClipse Advisors, a=
=20
Rosenbluth unit. "It's going to cost you $100 every time you change."=20
United led the way in dropping the fee last week, just four days after=20
filing for bankruptcy protection. United executives attributed the change=20
to customer feedback. Travel experts say it's a smart public-relations move=
=20
at a time when United can't afford to alienate its most reliable customers.=
=20
"What they need to do in bankruptcy is preserve every revenue opportunity=20
they have," says airline consultant Bob Mann. "One way to do that is being=
=20
more flexible than they had planned." The fact that the other airlines=20
followed United indicates how tough a time airlines are having raising=20
fares, says airline consultant Rich Golaszewski at GRA. "It just tells you=
=20
how weak things are."

US Airways is keeping the fee, which it initiated shortly after filing for=
=20
bankruptcy protection in August as part of a broader attack on=20
non-refundable tickets. It has been charging the fee since October. "We're=
=20
studying it, but haven't made any changes," spokesman David Castelveter=20
says. Delta says it still plans to start charging $100 to confirm a seat on=
=20
a different flight next month, but standby won't be an option. Northwest=20
never matched the fee. Passengers can fly standby for free, but they must=20
pay $100 to confirm a seat on a different flight.



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