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Jun 21, 2004 -- Air travel changing drastically

Air travel has become a huge bargain lately. In part it’s because discount airlines now fly coast to coast, which is something only full fare airlines used to do. Full fare airlines have had to cut fares by 80 to 90 percent to compete with discounters. But it doesn’t always work to the discounter’s advantage. When JetBlue jumped into the Long Beach/Oakland to Atlanta route, Delta fought back by creating tons of flights and reducing its prices significantly. After a year and a half, JetBlue had to leave the market. The same thing is happening in Dallas, where AirTran is trying to capture some of the Dallas to LA route. As a result, American Airlines is cutting fares for business travelers by as much as 95 percent and is adding 39 flights a day on that route. Leisure fares are dropping by about 50 percent, as well. All across the country, the business model that full fare airlines have traditionally used is dying. The full fare airlines are going to have to change their business model if they want to survive. It’s likely that of the six full fare airlines, only three or four at most will make it. Many people will lose their jobs, which is sad. But it’s great for consumers. Also, if you have miles on one of the six full fare airlines, use them! The six are Delta, American, United, Continental, Northwest and US Air.

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