U.S. Airlines Introduce Budget Fares To Compete (But There's A Catch)

Above, a United Airlines Boeing 787. Photo by Armand Vaquer.

Major U.S. airlines have been feeling the pinch by being undercut by budget carriers. Now that oil prices are down and they're seeing record profits, they are responding with their own cheap fares.

Naturally, with them, there's always a catch.

Condé Nast Traveler reported:

Tired of being undercut by budget airlines Spirit and Frontier, Delta, United, and American are responding with their own cheap fares. But before you buy that $100 roundtrip to Miami, read the fine print. Your ticket might not include what you expect. 

First, the good news: Flush with the cash because of lower fuel prices, the big three are massively discounting some routes, especially between major cities. In recent weeks, United, Delta and American have sold roundtrips between New York and Chicago for as low as $71. You don't always even need to plan ahead—you’ll sometimes find a last-minute Los Angeles-Dallas ticket for about $100. 

But airlines know discounting to thwart competitors does not make sound long-term strategy, so they've hatched a plan: They'll match Spirit and Frontier, but rather than give away the full airline experience for $71, they're removing some perks from tickets bought by bargain hunters. So far, only Delta has implemented its plan—it calls its cheapest fares "Basic Economy” and has only introduced them in select markets—but American and United have signaled they'll likely follow with no-frills fares in the second half of this year.

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