Fewer will fly, but fares won't fall

The recession will keep more people from flying this summer but that doesn't mean travelers will find bargain-basement fares or empty seats next to them when they do get on a plane.

As air travel has declined, airlines have been dropping capacity -- the number of flights and seats they make available -- by parking older planes and reducing flights. But experts say consumers can expect consumer-friendly fares, at least until the end of the summer, when capacity could drop again and fuel prices could rise.

The industry expects 7 percent fewer passengers will travel June 1 through Aug. 31, 2009, compared with the same period in 2008. About 195 million passengers are expected to fly this summer on U.S. airlines, down from 209 million during the summer months of 2008, the Air Transport Association of America (ATA) said Friday in its summer air travel forecast.

"Think about the number of companies that have closed their doors or downsized. Those people that worked for those companies have traveled either for business or for leisure," said David Castelveter, spokesman for ATA, an airline lobbying group. "They're not going to travel."

And even people with jobs are opting to stay home. "They're leery about how they will spend the money. The global recession is affecting everybody," he said.

The expected dip in what is typically high travel season for vacationing families does not come as a surprise, given the economy and the already steady decline in airline traffic. Air passenger traffic has dropped more than 10 percent since a year ago. Delta said last week that traffic for Delta and Northwest in April dropped 7.7 percent from a year ago while capacity fell 7.1 percent.

"Remember the days when there was so much capacity you knew there were going to be empty seats, you wouldn't have this person beside you?" said Castelveter. "The carriers can't afford today to fly around half-empty airplanes," he said. "You'll see 7 percent fewer passengers but you have seen them already reducing capacity, so planes will be fuller."

But Michael Boyd, an airline analyst in Colorado, discounted concerns about long lines at airports and packed airplanes during the summer travel season.

"The airplanes have been full. They were full last winter, they were full last summer, pretty much," he said. "You might have four more people on the airplane than you did before. So this argument that the airports are going to look like the fall of Saigon is nonsense. We're always going to have full airplanes."

Boyd predicted fares will be consumer-friendly through August. "But by September, airlines will have trimmed another 5 percent or more capacity, and then, fares will go up. Add in fuel prices, and the increases could be as much as 5 percent to 8 percent on average."

Since early May, oil prices have jumped by nearly $8 a barrel as it appeared the worst of the recession was over, which could lead to higher fuel prices for airlines.

Minneapolis travel expert Terry Trippler said travelers won't see the "whiz-bang" sales they often do in summer.

Trippler also said he didn't think it will be any more challenging for people to use their frequent-flier miles this summer. "Between the reduction in capacity and Delta's relaxing of some of the rules -- those two together will keep it about the same," he said.

Delta announced its summer sale a couple of weeks ago for Northwest and Delta flights through Sept. 14, and most other major airlines responded by dropping prices. For the Delta sale, tickets must be purchased by Monday, and prices are best on Tuesday and Wednesday flights.