Airlines Show Concerns About Winter Demand Levels

Now that third quarter earnings releases are winding down, people will need to fully turn their attention to the long, cold winter ahead. (It actually may be kind of warm thanks to El Niño, but I digress.) Early signs are that airlines are somewhat concerned about demand levels. Their actions are speaking very loudly.

Domestically, we need to look no further than Southwest Airlines. Back during the summer, they ran an aggressive fare sale promo that filled up a lot of fall seats with cheap fares. Now they seem to be doing the same thing for the winter.

In their 4th Quarter Sale, flights less than 375 miles are going for a mere $25 one way. Flights over 1,000 miles are selling for $100 one way. I guess we should all celebrate that at least they’ve moved beyond the $99 pricepoint? Sheesh. Of course, you will only get these fares during the low times. Travel is only December 2 - December 16 and January 5 to February 10. Those are textbook low season times, but they usually haven’t had to go this low.

In the international world, it appears that airlines are getting nervous as well but some airlines have more time to prepare. Singapore Airlines has rolled out its Future Proof Fares for 2010, at least in the Australian market. If you book a flight from Australia to Europe before January 5, they’ll give you the difference if the fare goes down. This appears to be for any flight between April 1 and November 30, 2010. Yes, that’s heading into the off peak winter season on the other side of the equator.

We’re going to see more of these types of promotions as the temperatures continue to drop.

This says to me that they want to get revenue in the door now in case things get worse down the road. Keep people traveling, or so they say.