NEW YORK, AUG. 12 -- American Airlines has become the third major U.S. carrier to match fare increases and a new discount restriction announced last week by Continental Airlines, a move analysts called good for the industry but bad for budget-minded travelers.
Stephen McGregor, a spokesman for Dallas-based American, said the fare increases, which range from $2 to $20 in selected markets, become effective Sunday and will be applied only on routes where the airline directly competes with Continental.
McGregor said that as of Sunday, American also will match Continental's imposition of a system-wide three-day advance purchase requirement on a previously unrestricted class of discount fares.
United and Northwest also have said they would match the move by Continental, a unit of Texas Air Corp. and a major force in setting fares. Texas Air also is the parent of Eastern Airlines and commands about 20 percent of the domestic air-travel market.
Delta Air Lines spokesman James Lundy said the carrier still is studying the fare increases on a market-by-market basis, but has decided to impose the three-day advance purchase restriction.
Continental's announcement Friday came amidst the summer boom in airline traffic.
Financial analysts who follow the airlines said the move to increase fares by Continental reflected pressure to start making money at the airline, which expanded rapidly earlier this year and had aggressively discounted fares to attract travelers.
"I think what's significant is the fact is that Texas Air is the one initiating the increases," said Louis Marckesano, an analyst at the Philadelphia investment firm Janney Montgomery Scott Inc. "With the losses at Continental and the need to shore up the bottom line, they're more interested in raising fares now than increasing traffic."