LI holiday air travelers paying slight rise in prices

Long Islanders traveling by air for the Thanksgiving and December holidays will be paying higher fares than last year.

The increases come despite declining fuel costs and as airlines add more capacity.

Travelers flying domestically from Kennedy or LaGuardia airports will be paying about 3 percent more than last year, an average of $498.31 round-trip, including taxes and fees paid at time of ticket purchase, according to an analysis done for Newsday by Airlines Reporting Corp., which processes ticket transactions for airlines and travel agents.

Travelers heading to international warm spots in Mexico or the Caribbean will be paying fares up only about 1 percent, averaging $694.20, said the Arlington, Virginia-based company.

The average fares are based on advance ticket purchases for travel between this Saturday and New Year's Day. No data were available for flights from Long Island MacArthur Airport in Ronkonkoma.

The small increases this year contrast with increases last year of 12 percent for domestic flights and 9 percent for Caribbean and Mexico flights, compared to the 2012 holiday season.

Airlines' fuel costs, their largest single expense, have been three-tenths of a percent lower this year through December than in the same period a year earlier, according to Airlines for America, an industry trade group based in Washington, D.C. Government figures for the 12 months ended in September show a similar increase. Costs have fallen further since then.

"So there's less cost-side pressure to raise prices," said longtime airline consultant Robert Mann of Port Washington.

Fares aren't falling, Mann said, in part because most airlines are locked into higher fuel prices due to hedging -- usually by purchasing petroleum futures, which helps protect them against surges in price but limits the savings when fuel prices fall.

He added there's simply no pressure on the carriers to cut prices: "The planes are very full, and there no reason to believe they are going to be less full, so why would you cut prices?"

An Airlines for America spokeswoman countered in an email that airlines' overall operating expenses rose by 3.1 percent this year through December.

Still the supply-demand balance has shifted a bit this year toward the consumer, said Chuck Thackston, managing director of data and analytics for Airlines Reporting, as airlines add seats after years of cutting service to match weak passenger demand during the recession. "They're not adding a whole lot," he said, "but they're not decreasing capacity."

U.S. airlines are increasing the number of seats offered domestically by 1.02 percent in this quarter from a year earlier, to about 206 million available seats, according to the British company OAG, formerly known as the Official Airline Guide.

Airlines for America forecasts passenger traffic will increase by 1.5 percent over last year during the 12 days surrounding Thanksgiving. It issued no forecast for the period around Christmas.