According to the Business Travel Monitor, a survey compiled by AmEx subsidiary Eclipse Advisors, we can thank the low-cost carriers, who are pushing the major carriers down and putting the lid on prices for popular routes.
The average one-way fare paid for a business trip on a basket of domestic routes studied by researchers was $217 in the third quarter, down 10 percent from the period a year earlier. One example of the impact of low-cost carriers is in Philadelphia, where Southwest Airlines started operating in May against US Airways. In the third quarter, the average fare for a business trip in Philadelphia fell 40 percent. In Cleveland, which Eclipse said had not yet felt the full impact of low-cost carrier pressure, the average fare rose 16 percent. In addition, WorldTravel BTI, a corporate travel-management company in Atlanta, reported that one in four clients said they had increased their travel budgets in 2004, a higher proportion than expected.