August 4, 2006
US Airways said on Thursday it had lowered fares on its hourly shuttle between New York and Boston, a route that analysts say could see a low-fare war between US Airways and JetBlue Airways.
US Air said it cut prices by 54 percent on 14 day advance purchase tickets on the shuttle route, to USD$100 for a round trip.
Delta Air Lines, which raised most of its domestic fares by USD$5 each way last week, said it had matched the fare cut on the route.
"I think this is very tactical, and it's addressing the price sensitive academic communities in New York and Boston," said airline consultant Robert Mann.
He noted that the 14 day advance purchase requirement excludes many business travelers who book on short notice.
Mann said US Airways' fare cut seems to be a shot at low-cost carrier JetBlue, which last week announced fare sales, including one on its popular New York-to-Boston service.
US airlines have boosted revenue this year by cutting costs, restricting capacity and raising fares. As a result, major carriers have posted their first quarterly profits in years.
Mann said the fare sales do not represent a significant departure from the trend toward higher fares. Rather they reflect the end of the peak summer travel season, when carriers typically lower fares, he said.
(Reuters)