Delta CEO says 15 percent fare hike needed for US carriers to offset soaring fuel prices
Delta Air Lines Inc. CEO Richard Anderson said today that, given current fuel prices, domestic carriers would need to raise fares by 15 percent to 20 percent just to break even.
By DAN CATERINICCHIA, Associated Press
Last update: April 22, 2008 - 12:58 PM

WASHINGTON - Domestic airlines need to raise fares by 15 percent to 20 percent just to break even at current fuel prices, the chief executive of Delta Air Lines, which seeks to acquire Northwest Airlines, said Tuesday.

"An airline ticket has got to reflect the full cost of fuel," Delta Air Lines Inc. CEO Richard Anderson told reporters, adding that such an increase was likely to depress demand and prompt carriers to further trim their flight schedules.

Cost-cutting measures "have largely been exhausted," Northwest Airlines Corp. CEO Doug Steenland said.

Since Dec. 20, carriers have raised fares nine times, according to BestFares.com, and a number of airlines in recent weeks have also raised fees for checking a second bag and other amenities.

When asked if a combined Delta-Northwest would be profitable in its first year, Anderson returned to a common theme: "It will all be a product of fuel prices ... and stay tuned for earnings tomorrow and you'll see what a dramatic effect it's had." (read more)