WHAT CHEAP SEATS?

Airline profits have gained altitude in recent years, with full jets and rising prices providing lift. According to Tom Parsons, editor of Best Fares Discount Travel Magazine, the major airlines have boosted fares 37 times since May 1992. Fares are up 18% since January, with business travelers shouldering a 25% increase. No other industry in the country currently has such pricing power.

Still, summer is traditionally a time of fare wars--with the usual 1,001 restrictions. Last week, on the heels of previous sales by American and TWA, United announced a new volley: round-trip specials, up to 45% off regular 21-day advance-purchase fares. United was quickly matched by six other major carriers. Deeper digging yields deeper discounts. Surfing the airline and other Internet travel sites is one route, with some carriers, such as American, posting weekly bulletins with weekend fare sales. Consolidators also offer fares well below published tickets. The downside: less flexibility and tighter restrictions.

Discount airlines are still the most potent force in challenging the high fares in the majors' "fortress hubs." Before ValuJet resumed service between Atlanta and Dallas-Fort Worth in April, a round-trip ticket cost $490; subsequently, the price dropped to $138. Flying into an "alternative city" served by many discount carriers can also shave dollars. A round trip between San Diego, Calif., and Washington costs $564, but flying into Baltimore, Md., instead, a route now covered by Southwest, costs $268. "The low-cost carriers are driving the big guys crazy in cities where there was no competition," says Parsons. This will continue--assuming the discounters can survive.

--By Stacy Perman