(Thanks to reader IAH-PHX for the heads up on this)
You’ve likely read that the government funded the FAA again, allowing US to once again collect taxes on flights (in fact, those taxes are retroactive, so airlines will not be refunding them. Big props to Gary from View From the Wing for being the only person I saw you suggested from day one that the tax would be applied retroactively.)
You’ll also remember that nearly every airline did not pass the tax savings on to customers (they should not have – that was the correct move). But it now appears that airlines have raised fares again today another 7.5% or so, to reflect the re-instatement of the government taxes. In other words, the government helped the airlines permanently raise fares. I knew airlines wouldn’t pass those original tax savings back to customers, but I didn’t see it coming that they would then, in turn, raise fares when taxes were reinstated. Assuming it sticks, it’s pretty brilliant. Complain all you want, but airlines are burdened by high oil prices and the (obviously) uncertain economy. I don’t begrudge them trying to run their business and take the revenue when they can.
UPDATE: It looks like Southwest is rolling back the 7%.
UPDATE 2: Unless they’re not.