American Air keeps price war alive with vow to match cheap fares

American Airlines will “absolutely, positively” match discount fares from low-cost rivals, CEO Doug Parker said, signaling no end in sight for a price war that has knocked down industry shares this summer. “We price our product to match the competition,” Parker told reporters at a conference in Fort Worth, Texas. “We always have, we always will.” Airline stocks, already down 18% since early July, reversed an early gain after the CEO’s comments. Big airlines such as American, United Continental and Delta are competing against discounters with a new no-frills fare class called basic economy, which offers cheaper prices in exchange for fewer amenities. The clash, centered in major airports, is nearing balance, Parker said. “It’s not equilibrium yet, but it feels like it’s getting sorted out,” he said. “There is a market for ultra low-cost carriers and their product. They’ve proven that. Their financial performance on a margin basis is a lot stronger than ours. But we have an enormous advantage in and out of our hubs.”<br/>