Passengers may be flying out of Cincinnati with more money in their pockets due to Delta Air Lines' recent fare reduction on flights from the Cincinnati/Northern Kentucky International Airport (CVG).
After assessing fares out of CVG, the company's second-largest hub, the Atlanta-based airline reduced prices on 60 percent of its nonstop domestic markets, adding up to an average 20 percent savings for Delta passengers.
According to Susan Elliott, Delta's senior manager of corporate communications, the reduction was needed in order to remain competitive in select markets.
"When we do find fares that are too high for demand, we make adjustments (to those prices)," Elliott said, "but those fares are also reflective of the cost of operating at the hub in Cincinnati. There are more than 60 markets that will see the reductions."
According to Elliot, lower fares will be included on flights to certain cities such as Seattle, San Diego, Milwaukee and Rochester, N.Y., where fares were no longer competitive.
With most of the price cuts on the lowest fares available in select markets, Delta passengers will save $80 on a round trip flight on average.
According to Elliott, the reductions only apply to leisure fares, which requires advance purchase and has no cancellation policy.
According to James Brock, an economics professor at Miami University who has studied the airline industry for 28 years, Delta has a lot of room to lower its rates because the rates are currently very high.
"Cincinnati is the most monopolized major airport hub in the U.S. and Delta has about 94 percent of all the flights and passengers of (those) flying out of Cincinnati," Brock said, citing statistics from the U.S. Department of Transportation (DOT).
According to DOT, CVG ranked first out of 121 national airports in a study of domestic airline fares released in August, which provided fare premiums at major airports in the first three months this year.
"Studies have shown that Cincinnati fares are 60 percent higher than comparable flights from other airports in the U.S.," Brock said.
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Brock said he wrote about these findings in The Structure of American Industry.
Generally, the prices at CVG are leading Miami students, such as senior Jon Murray, to fly from regional airports such as Dayton and Indianapolis that offer a cheaper alternative to CVG.
"Last time I flew to L.A. in May, it saved me $150 flying from Dayton instead of Cincinnati," Murray said.
Regardless of price, Murray prefers what Dayton can offer as a smaller airport compared to CVG.
"It's easier to get through security and the facilities are a lot nicer," Murray said. "It's just not as crowded."
Regardless of flyers who seek alternative departure sites, Delta's business out of Cincinnati has been steady, Elliott said.
According to the U.S. Bureau of Transportation, Delta had 11 percent of the domestic market share with passengers flying 64 billion miles between July 2006 and this past June.
Although Murray said fares must be competitively cheaper to draw him to Delta and Cincinnati, he thinks the reduction is good news for travelers.
"It will spur competition amongst airlines," Murray said. "When businesses compete with prices, the customer always wins."
Brock agrees and has noticed trends within the business regarding price reductions.
"When one airline does it, the others follow along and do the same thing," Brock said. "It will be interesting to see because they will do it very quickly."
Despite the drop in prices, travel agencies such as George Simonds's Travel Unlimited in Oxford have not seen an increase in purchases, which may be a result of online purchases, according to Mickey Simonds, vice president of the agency.
"Most people today buy their tickets from the Internet," Simonds said. "The trend is just to book it themselves."
According to Elliott, passengers can buy tickets from Delta.com or pay an additional $20 for tickets purchased via telephone, travel agent or at the airport.
Brock's advice to students who plan on traveling is to purchase tickets online.
"If (students) are thinking of flying Delta in or out of Cincinnati, now might be a good time to book a flight because those lower fares might not last very long," he said.
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