Delta increases its fares on U.S. round trips by $10

0 Comments | Deseret News (Salt Lake City), Sep 8, 2007 | by Bloomberg News

Delta Air Lines, the third-largest U.S. carrier, raised fares Friday on most U.S. round trips by $10, citing higher costs. Other airlines didn't immediately join in the move.

Delta's increase follows a 10 percent rise in the price of jet fuel for immediate delivery in New York harbor in the last month. Southwest Airlines raised round-trip fares as much as $20 on Aug. 31, triggering higher charges by seven other carriers including Delta.

'"Fare increases reflect increased costs and fuel plays a big role in our business," said Betsy Talton, a spokeswoman for Atlanta- based Delta.

Fuel and labor are the top two expenses for airlines. Each $1 change in the price of a barrel of oil, from which jet fuel is refined, changes the U.S. airline industry's pretax profitability by $500 million, according to Merrill Lynch & Co..

AMR Corp.'s American Airlines, the world's biggest carrier, UAL Corp.'s United Airlines, Northwest Airlines Corp. and US Airways Group Inc. said they are studying the Delta increase.

Continental Airlines and Southwest didn't increase fares, spokeswomen said, and JetBlue Airways has no plans to do so, spokeswoman Alison Eshelman said.