Airlines roll back fuel surcharge

Last update: January 22, 2008 - 8:43 PM

For the second time this month, major airlines have retreated from hefty fuel surcharge increases.

American Airlines led the drive late last week to impose a $40 round-trip fuel surcharge on many domestic fares, but the increase has collapsed. Big airlines have reduced that surcharge to $20.

Northwest Airlines spokesman Roman Blahoski said Tuesday that "Northwest rolled back the fuel surcharge increase to remain competitive because the increase was not fully matched by all carriers."

Earlier this month, a fuel surcharge of $50 on many round-trip tickets also failed to stick.

Terry Trippler, a Minneapolis-based airline expert, said that it is "highly unusual" for two back-to-back fare increases to fall apart in such a short time frame.

"This tells me that the airlines may feel they have hit that price point where they noticed a drop off in bookings," Trippler said.

He noted that the carriers still have another avenue for boosting revenue -- reducing the number of low-fare seats they make available on flights.

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