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Airlines pass higher fuel costs to passengers

John Dimsdale Feb 20, 2012

Adriene Hill: Those rising gas prices aren’t just squeezing drivers. Frequent flyers are feeling the pinch too. Nearly every airline boosted fares over the past week.

And as Marketplace’s John Dimsdale reports, there are probably more price hikes to come.

John Dimsdale: Jet fuel prices have taken off since the beginning of the year. Last week, JetBlue and Southwest decided to pass some of those costs along to passengers, and it didn’t take long for most of the others to follow. Fuel prices are expected to keep rising.

George Hobica at Airfarewatchdog.com sees more fare hikes in the future — within limits.

George Hobica: Airlines can raise airfares only so much before consumers stay home, drive or find other means of transportation. 

He says that even goes for business travelers.

George Hobica: Our company was just handed down an edict, please treat the company’s money as your own and consider teleconferencing and Skyping. 

Still, mergers and bankruptcies have reduced competition in the airline industry. Rick Seaney at FareCompare.com says that gives survivors more opportunities to pass along costs.

Rick Seaney: I expect airlines to continue to try to raise prices every couple weeks with limited success. 

Seaney says they keep a close eye on sales of middle seats. When those fall off, airlines have to roll back price hikes.

In Washington, I’m John Dimsdale for Marketplace.

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