With major U.S. airlines adding a $20 roundtrip fuel surcharge early this year, followed by an increase on roundtrip domestic tickets of about $40 for business travelers and $20 for leisure travelers who book in advance, what can executives expect in the future?
Airfares should remain constant for the rest of the year, says Stuart Klaskin, managing partner of Klaskin, Kushner & Company, a Miami-based aviation consulting firm. Jet fuel prices will start to come down by spring, "but travelers will be paying what they're paying now for the rest of the year," he predicts.
The hikes were low enough to be an annoyance but not an issue, says Kevin Notrica, owner of Long Beach, California-based Nance Travel. "All travelers want the lowest fare, but an increase of $40 a ticket, when a business traveler is paying $1,000, doesn't make much difference." Mr. Notrica says his business clients cut costs by buying economy class and upgrading with frequent-flier miles, hotel points, coupons, and other airline special offers when they can.
"Book in advance and use restrictive tickets. Preplanning goes a long way," advises Mr. Klaskin.
Rafael Ortega, owner of Ortega Travel Services Inc. in Atlanta, says the best way for business travelers (who book at the last minute and pay the highest fares) to stabilize travel costs is to shop for a travel agency that can give them consistently discounted fares. High-volume agencies negotiate reduced fares with the airlines and pass the savings on to clients, and they use airline consolidators to save travelers time and money.
Mr. Ortega says he saves clients up to 50 percent on flights to San Salvador. As for domestic flights, he says he can send business travelers to Los Angeles, on three days' notice, for $900 on the same plane and flight they'd normally book for $1,200. With five or six days' notice, Mr. Ortega says, he can save up to 50 percent on regularly scheduled domestic flights.
"There is no advantage for travelers to buy now for several months in advance to lock in current prices," says Mr. Notrica. Bob Harrell of Harrell Associates, a New York travel consulting firm that specializes in airline pricing trends, says the airfare seesaw isn't likely to end. "Airlines tend to have fare sales about every six weeks."
Messrs. Ortega and Notrica agree that leisure flyers should purchase tickets 14 to 21 days in advance. Airlines work on "planned demand, so the first 30 seats will be cheaper than the last 30 seats," explains Mr. Notrica.
How far ahead to book also depends on the destination and the season. For the best fares to Mexico City, Mr. Notrica recommends booking 30 days in advance. Summer flights to Hawaii or Europe should be locked in by March or April, he adds.
In contrast to the domestic fare hikes, international prices have remained fairly stable, says Mr. Ortega, who does 60 percent of his business with international travel, particularly to Mexico, Central America, and South America.
"Taxes are the catch with international fares," he says. And taxes on international tickets have gone way up. "While the international fares may look good, travelers shouldn't be fooled into thinking they're getting a bargain." The taxes usually aren't included in the price quote or advertising. "Always ask for the dollar total of the taxes," Mr. Ortega advises.
"The tax can be as high as $120 extra on a $330 ticket to Latin America. Taxes can increase the fare on flights to Mexico by $85 and range from $55 to $140 extra per ticket on flights to Central America or Peru," he says.
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– Compiled by Barbara Beckley
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