Airfares: Avoiding the Takeoff


By Sonja Ryst Expect to pay more than you did last year to travel during the holidays. Peak fares will rise even more than usual -- thanks to spiking fuel expenses and the fact that several major carriers are in bankruptcy. (Delta Air Lines (DAL) and Northwest Airlines (NWACQ) filed just last month.) But you can still hunt down some deals, experts say, though it may take some work. Here are some tips for saving dollars:

It's never too soon to start looking -- and don't wait to buy

Tom Parsons, CEO of Bestfares.com, began searching in August for round-trip fares from Dallas to Tampa between Dec. 27 and Jan. 2. Parsons found an offer for $390 on a nonstop flight with American Airlines (AMR), but he couldn't buy the tickets immediately because he needed to check the spelling of the name of his son's friend, who will be traveling with the family. One week later, the ticket price had shot up to $580 per person.

Parsons changed the dates and booked tickets for the following day at 5 p.m., which enabled him to get the $390 fare he had see the week before. That same itinerary is selling for about $640, Parson says. He says he's enjoying watching the fares go up and thinking about how much he saved by planning ahead and being a little flexible. "I believe that 30 days before Christmas, tickets are going to jump up to at least $900 to $1,100 round trip per person," he says. "I wish I could do this with stocks."

According to research firm Harrell Associates, leisure travelers paid an average of $109 for a one-way ticket during the week ended Oct. 3, up 12% from the same period a year earlier for travel on major carriers American Airlines, United Airlines (UALAQ), Delta Air Lines, Continental Airlines (CAL), US Airways (LCC), Northwest Airlines, and America West Airlines.

Plus, fares have climbed by more than 10% a week since early August. Yet passenger traffic hasn't shown any signs yet of slowing down: The Air Transport Assn. found that 50.3 million fare-paying passengers boarded planes in August, up 1.5% from the year-ago period.

Don't follow the crowd

Heavyweights such as American Airlines and Continental Airlines fly to California's Fresno Yosemite International Airport, while discount carriers like Southwest Airlines (LUV) and JetBlue Airways (JBLU) fly to the nearby Norman Y. Mineta San Jos? International Airport in San Jose. Flying round trip on the day before Thanksgiving from New York's LaGuardia Airport to the San Jose airport would cost $613.40 on American Airlines (fare quoted from the company's telephone-reservation hotline on Oct. 6). But flying from New York to Fresno airport would cost $678.40 -- on the same airline.

It's not just where, but when

Do you really have to be there Friday morning? Maybe you could travel the next day. Big cost discrepancies often exist for the same flights on different days, or for the same routes at different times of the day. Tuesday, Wednesday, and Saturday are more likely to have off-peak travel fares. Be sure, too, to look at all the flights available on a given day.

Don't discount the discounters

The average price of a one-way leisure traveler's ticket in August on Southwest Airlines cost $51.75, vs. $93 for the major carriers, according to Harrell Associates. True, even the lower-cost carriers have hiked prices: Southwest said it increased fares on one-way tickets by $2 to $3 in August and did the same in September.

But such hikes are modest vs. the 10% hikes the larger carriers have been averaging. "We're always keeping our options open [on prices]," says Kevin Michalenko, director of pricing at Southwest Airlines. "I wouldn't say we typically plan them."

Look into booking directly

You might think the best prices are available on such services as priceline.com or Travelocity, but not all airlines work with the online travel agents. For example, you have to buy tickets with discount carriers Southwest, JetBlue, AirTran Airways (AAI), and Spirit Airlines directly from their Web sites.

"There's tension between the online agencies and the airlines," says Neil Bainton, chief operating officer of Dallas-based FareCompare. "They're all trying hard to get the consumer to book directly through" their Web sites.

Dare to compare

If you want to research price information through a company that doesn't also sell tickets, try a Web site such as FareCompare.com to get a sense of the going rate for your trip. Consumers can use this service for free.

Another resource is ITA Software of Cambridge, Mass., which licenses its information about airfares to airlines, Web sites, and travel agencies like Orbitz. Consumers can check the fares that ITA Software sends to the agencies by going to the demonstration area of the company's site.

You don't have to fly

What's fare-tracking expert Bob Harrell, president of Harrell Associates, doing to save on his holiday travel this year? Going by train, which he does "wherever possible." He explains: "It's more reasonable -- and less confusing -- because they have a simpler fare structure." Plus, it's only a three-hour train ride from his home in New York to his vacation place in Rhode Island. And a bonus: You don't have to worry about checking your luggage.

Ryst is a reporter for BusinessWeek Online in New York


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