Air travel costs will stay high
August 11th, 2008 at 11:01pm Under Air travel tickets+ travel news
Despite falling oil prices, at $113 a barrel, fuel is still contributing to a rise in air fares which doesn’t look likely to fall any time soon. British Airways and American Airlines have been in talks and expect to file an application for exemption from US competition laws within 2-3 weeks.
BA already have a similar deal with Iberia, so this would inevitably mean higher prices for passengers, argues Richard Branson, founder and president of rival, Virgin Atlantic Airways. Mr Branson views this potential deal as being so serious that he has made a public appeal to both presidential candidates not to support the deal. “Just because life is tough out there, you shouldn’t rid yourself of competition,” Branson told BBC radio, adding that it was “very dangerous” to believe that consolidation was the best response to the current difficult economic conditions.
Market analysts appear to believe that the deal is likely to go through, despite protests from many quarters. If it does, expect fares to remain the same, or even rise, shortly thereafter.
By frann
