Airlines push fuel surcharge increases 

Market dynamics to dictate success of hikes

By Dave Hannon -- Purchasing, 1/18/2008 1:00:00 PM

Many major airlines have issued increases in their fuel surcharges in an effort to recoup fuel costs, but market competition is playing a major factor in deciding whether the surcharges stick.

Last week, an attempted fuel surcharge hike led by UAL, parent of United Airlines, was matched by most other airlines except one, so others then withdrew their surcharges to offer more competitive pricing in the market.

AMR Corp., parent of American Airlines, doubled its fuel surcharge this week to $40 per domestic roundtrip ticket, but market watchers were skeptical if that surcharge would stick. Delta Air Lines matched it.

"This American Airlines initiated increase attempt is the third in as many weeks of 2008," said FareCompare's Rick Seaney in a Dow Jones newswires report. "It will most likely be up to Continental to decide the fate of this increase as they were the first to pull out earlier this week on the attempted $50 roundtrip fuel surcharge increase."