We’re About to See the Effect of Merger Mania
For the savvy frequent flier, it’s time to think turkey, Santa Claus, and Auld Lang Syne. That’s right, summer is almost over from a fare perspective. The deals that are out there will be out there for a while longer—a ticket from New York to Frankfurt in January was $1,538 (plus taxes and fees) and it still is now; but it’s holiday travel, especially to Europe, that the airlines are getting ready to promote. Last year Continental retained its reputation for “Early Kickoff Carrier”, posting Holiday Business Class fares on Aug. 11 that started at $1,000 (New York to London and Manchester) for Thanksgiving travel, and about $1,300 on the same route at Christmas and New Year’s.
This year European Holiday Business Class fares will have added significance, indicating where prices are headed as a result of the big recent mergers: Northwest and Delta’s completed merger, and Continental and United’s pending merger. If holiday promotional fares don’t materialize or come in much higher than in past years, brace yourself. It means that the mergers have done what they have always done: Reduce supply, thereby letting airlines raise prices. Europe is the canary in the coal mine because the region sees the biggest spike in demand during the holidays.
A Little History
Last year Continental started its Business Class holiday fares about a month later than in 2008 (August vs. July). 2009 Business Class Holiday fares on Continental were also a lot lower than those of other airlines, and almost $400 lower than 2008. Added to that was the incentive to win over Delta and Northwest (SkyTeam) members before Continental left that consortium on Oct. 27 to join the Star Alliance. In fact, during the first week of October, other SkyTeam members (Air France, Delta, KLM, and Northwest) brought their New York-London fares in line with Continental’s.
So, if you’re an optimist, do the following:
- Keep an eye open for American and United to run similar Business Class holiday promotions (as in past years), and use miles to upgrade to First Class. The best routes with First Class availability are typically New York-London for American, and Washington-Frankfurt for United.
- If you plan a mileage run to maintain elite status, the holiday season is the time to do it.
- If you’ve wanted to take a trip just because it’s a deal, this is the time to look for a deal.
If you’re a pessimist, do the following (quickly):
- Look at Icelandair. It’s offering summer fares through December 14. Currently a Business Class ticket from New York to London is $1,133, and Halifax to Paris is $1,103, with a ticketing deadline of July 9. (Although see the next item.)
- You can still get a summer deal—don’t get flustered by fare deadlines. Last year most major airline’s Business Class fare promotions ran through the second week of August for travel through the second week of September. The deadline arrived and the next day the airlines came out with a new deadline.
- Fly From (or via) Canada if you are traveling short notice. Many airlines have started offering Business Class fares to Europe from Canada that are 50% less than usual and only require a 14-day advance purchase. For example: Toronto to Frankfurt is $2,517 on Air Canada, Air France, Continental, Delta, KLM, Lufthansa, United, and US Airways. From Detroit to Frankfurt (roughly the same distance), those carriers charge $5,226 or 52% more.
Always remember, if you can’t find a heavily discounted ticket to your destination or even from your departure city, consider starting your international leg in New York or buying a ticket to London, as both are low-cost hubs. (Paris can be good at times, too.) Be flexible on dates when price is the driver.