Travelers are concerned that the availability of cheap airplane tickets and cheap vacation packages may shrink as airlines continue to merge. Two of the largest most recent mergers are between United and Continental and between Southwest and AirTran.
Historically less competition has translated into higher prices. However, fare experts are saying that airline prices are not expected to increase significantly as a result of the pending airline mergers.
A bigger factor impacting airfares is the number of available seats. The number of seats available on domestic flights in September was 10 percent less than a year ago as a result of airlines reducing capacity because of the recession. Airline ticket prices have been creeping up, but airlines remain very concerned about overall flier resistance to higher prices. To find more revenue experts expect airlines to charge even higher fees for additional services such as check bags.
In the past when airfares have risen sharply people have tended to stay at home or drive. Higher prices also result in new discount airlines like JetBlue starting service.
Airfares are expected to fall for those flying out of Atlanta as a result of Southwests purchase of AirTran. Atlanta is the largest U.S. airport not served by Southwest and up until this merger Delta has dominated the Atlanta market. Southwests entry will give Delta its first formidable Atlanta competitor in a many years.
Fares may increase in cities where currently Southwest and AirTran compete against each other, such as Baltimore, Milwaukee, and Orlando.
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