SFGate: United Airlines raises fares up to $60 roundtrip

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Friday, May 23, 2008 (AP)
United Airlines raises fares up to $60 roundtrip
By ADAM SCHRECK, AP Business Writer


   (05-23) 08:37 PDT New York (AP) --
   United Airlines ratcheted up the pressure on fliers ahead of the holiday
weekend, raising most domestic fares by as much as $60 roundtrip to offset
the runaway cost of fuel.
   A representative for the second-largest U.S. airline also said Friday the
Chicago-based carrier is "seriously considering" following AMR Corp.'s
American Airlines in charging passengers to check their first piece of
luggage.
   "It's part of all the work that we're doing to try to offset fuel costs,"
spokeswoman Robin Urbanski said.
   The ticket price increase, which went into effect late Thursday, will
leave travelers paying $10 to $60 more, depending on how far they fly and
the competition on the route. The biggest increase affects routes of 750
miles or more — less than the distance from New York to Chicago
— that low-cost carriers such as Southwest Airlines Co. do not
serve.
   Airlines have come under intense pressure to boost revenue and cut costs
as the price of fuel has soared. As of Monday, spot prices for jet fuel in
New York were up 43 percent from the start of the year, according to the
Energy Information Administration.
   UAL Corp.'s United has been among the most aggressive carriers in pushing
fares and fuel surcharges higher in recent months, and its increases are
often rapidly matched by competitors. Airlines are prohibited from
agreeing to simultaneously raise fares, but nothing prevents them from
following rivals' lead.
   "Will the other legacy airlines match? To that I respond: Do they really
have a choice? I would be surprised if we don't see wide spread matching
over the long weekend," said Rick Seaney, chief executive of airfare
research site FareCompare.com, in an e-mail.
   American Airlines became the first major domestic carrier on Wednesday to
say it would charge passengers $15 to check their first bag.
   On Wall Street, airline stocks came under pressure as oil prices resumed
their climb, with benchmark light, sweet crude rising $2.18 to $132.99 a
barrel on the New York Mercantile Exchange.
   UAL shares dropped 62 cents, or 7.6 percent, to $7.53 in morning trading.
Earlier in the session, the stock sank to $7.46, its lowest point since
the carrier emerged from bankruptcy protection in February 2006. ----------=
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Copyright 2008 AP

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