But airlines have grounded airplanes and retrenched on some routes in recent years as companies moved to reverse years of losses. Overall, domestic capacity since 2000 has grown by only about 6 percent in terms of available seat miles, an industry measure, according to the Bureau of Transportation Statistics.
With strong demand for travel in recent years, that has led to increasingly crowded planes and a greater ability by carriers to charge more. U.S. airlines last year flew with planes that were about 80 percent full, higher than at any other time in the industry's history, according to the Bureau of Transportation Statistics.
Rising fares carry risks. They could intensify political and regulatory scrutiny of potential mergers. They could also discourage fliers.
In particular, carriers risk losing some price-sensitive passengers, such as leisure or small business travelers, in order to squeeze additional income from regular business travelers, who provide the lion's share of revenue.
Bargain-hunting passengers "are just there to pad out what's left," said Rick Seaney, chief executive officer of Farecompare.com, which tracks price changes in tickets. "If consumers start to push back, the airlines will be smart and continue to lean as much as possible on the business traveler side."
Business customers are likely to take a hard look at the way they book their travel. While smaller businesses with less financial muscle are likely to scale back all but the most essential trips, major corporations will push travel managers to identify new ways to cut costs through centralized booking, more aggressive negotiations with airlines, or stricter enforcement of company travel rules.
Discount airlines, which because of their lower costs historically haven't mimicked fare increases by major network carriers, are beginning to raise prices. Southwest Airlines Co., the low-cost pioneer and the only major U.S. carrier that didn't post a loss for the first quarter of 2008, said recently that the run-up in fuel prices is forcing it to pass the higher costs on to passengers.
"With energy prices at these levels, we have to increase fares," said Gary Kelly, the airline's chief executive, during the company's earnings presentation April 17. "We'll have to be looking for opportunities to do more."
