Airlines Issue 10-Percent Hike In Fares

Major airlines, confident that strong fall bookings will hold up, are raising fares 10 percent to offset the return of a federal airline tax.

Continental Airlines started the increase and the rest of the industry quickly went along. The higher fares are for unrestricted coach tickets bought 21 days in advance.

A sample fare change for Continental will mean a $488 roundtrip ticket from New York to Los Angeles will now cost $537.

The airline industry has enjoyed a break from the ticket tax after it expired Dec. 31. But the reinstatement of the tax is included in the minimum wage package expected to be signed by President Clinton today.

American, Delta, United and Northwest followed Continental’s lead and raised their fares also.

Maverick airline Southwest, meanwhile, is bucking the trend and reinstating its buy one, get one free offer.