‘Buy early, and buy now’ - expert's take on ticket prices

Ray Neidl is one of the most respected observers around when it comes to the airline industry, and when the senior analyst for Calyon Security talks, an awful lot of people pay attention. His advice for folks planning to travel by air this summer? “Buy your tickets early and buy them soon - they're just going to go up.”

His prediction is predicated, of course, on the cost of Jet A, the fuel that propels commercial airliners. It's hovering around $160 per barrel now for the refined product.

Neidl made his recommendation in New Orleans yesterday (Wednesday, June 10), before a conclave of airport managers gathered for the annual meeting of the American Association of Airport Executives. This Cheapflights reporter was in the audience.

Neidl says: “This [downward swing] has me more concerned than ever - including 9/11.”

Neidl's estimation as to how the airline industry can weather this storm: cut capacity, and raise ticket prices. He believes seat capacity in this country will have to fall by about 20 percent, and airfares rise by approximately 25 percent. “Drastic action will have to be taken by the industry,” he contends.

Despite this, he believes “The major airlines can make it through this year without bankruptcy”.

As for the consumers' role in all this, the noted airline analyst asserts: “We, the travelers, are not paying our way. We're getting a free ride. The airlines aren't covering their costs.”

A Cheapflights' observation: it's still tough for airlines to raise airfares willy-nilly. They've got to take consumer tolerances into consideration. Seems they did precisely that this past weekend when a new fare increase, one floated by a major carrier, failed to stick.

Now, and into the foreseeable future, discount airfares are going to be with us. They aren't going away. Case-in-point is this reporter's initial quote from Southwest Airlines for the trip down to New Orleans to cover this story: $29, one-way.

© Cheapflights Ltd Jerry Chandler