Air travel fees, bumps and hassles

By Peter Greenberg

updated 9:17 a.m. ET Sept. 30, 2008

You don't need me to tell you that the summer of 2008 was a tough time for air travel. Higher airfares, crowded planes and let's not forget delayed and canceled flights. It was also the summer that air travel in America became the Land of the Fee: checked bag fees, talk-to-a human-being fee, eat-airline-food fee... How long before pay toilets are installed?

And just when you thought it couldn't get worse, fasten your seatbelts—it's going to be a very bumpy flight. That is, if you can find one. (Or worse, afford one.)

Consider this:

Within the next few weeks, airlines in the U.S. will be cutting their domestic capacity by up to 16 percent across the board. Southwest Airlines will cut 200 flights from its winter schedule this fall. In September, Jet Blue ended on the following routes: Boston to San Francisco, Boston to San José, New York to Ontario, Washington to Burbank, Washington to Las Vegas, and Washington to San Diego.

This means that major airlines will be parking (i.e., taking out of service) planes. Continental will park nearly 70 planes, American will retire more than 80 and United could park more than 120. Midwest is cutting one third of its fleet, and Frontier—currently operating under bankruptcy—is removing 17 percent of its capacity.

The U.S. has 524 airports offering commercial air service, and most city officials at these airports are worried about losing service. They should be. Airports in Cincinnati, Cleveland, Houston, Honolulu, San Juan, Las Vegas, Oakland and Columbus are just a few that are expected to lose more than 10 percent of their scheduled service. And in some states, the cuts will be radical: In Michigan, Toledo, Lansing, Flint and Grand Rapids are seeing double-digit reductions in seat capacity and fares are up 15 to 30 percent over the same time period.

The cuts in service are indeed dramatic. In the last 12 months, flight departures in Orlando have dropped nearly 18 percent. There's been a 25 percent drop in Hawaii, and a 16 percent drop in Las Vegas. Smaller markets are getting hit even harder—Milwaukee lost nearly 25 percent of its departures; Kansas City more than 26 percent. Even the Bahamas is getting hit—Nassau is losing more than 28 percent of its departing flights.

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Other airports hard  hit include Fort Lauderdale and San Juan. Even though, like Las Vegas and Orlando, these are very popular destinations, airlines are cutting back service there because these flights primarily carry low-margin leisure travelers. American Airlines, for example, expects to cut daily flights out of San Juan from 93 to 51 this month. That's huge. This will also impact the cruise industry, since it will be harder for passengers to reach the island to board their ships.

What does this mean to you? The law of supply and demand is taking over. That is, airfares are becoming rapidly more expensive.

Lisa Thornberg / iStockphoto.com Don't travel on Thanksgiving — it's the most heavily traveled holiday of the year. But the week after is called the 'dead week' in the travel industry, when fares drop significantly the Tuesday after Thanksgiving.

For example, I just priced a coach seat on American Airlines over Thanksgiving on a flight between Los Angeles and New York. Last year, the same ticket cost $484, an increase over the year before when it was about $375. This year—a whopping $789! I checked with the folks at farecompare.com, a great Web site that analyzes airfares (and changes in those fares). Their report isn't exactly upbeat. In the last year, Thanksgiving airfares are up about 31 percent; Christmas airfares are up 30 percent. They're even higher in markets like Los Angeles and New York.

What can you do as fares climb and capacity shrinks? And what happens if you book a flight now that disappears in two months? Keep in mind that in those situations, the airlines' only responsibility is to offer you a full refund without penalty or reschedule you on another of their flights. But believe me—their "rescheduled" flight itinerary may include an unorthodox, and long, itinerary. The reality is, fall airline schedules are wreaking havoc with our own travel schedules and wallets, and we need to adjust in anticipation of even more problems.

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