Southwest, which pioneered the discount model, is a frequent holdout from rivals’ attempts to raise fares. Scott Olson/Getty Images/AFP
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U.S. airlines are asking shareholders to believe they can raise ticket prices while ramping up the supply of seats.Six attempts at broad-based fare increases have failed in the last two months, most recently a bid last week by Delta Air Lines Inc.That's creating a confidence crisis for investors, who last week sent airlines to the biggest drop since 2015 when United Continental Holdings Inc. announced an aggressive expansion plan. Southwest Airlines Co., JetBlue Airways Corp. and Alaska Air Group Inc. are also planning to grow faster than the economy.JetBlue said it would boost 2018 capacity as much as 8.5 percent, Alaska Air has targeted 7.5 percent and Southwest will grow about 5 percent.Baker said an increase last month failed when United didn't match it.Deep discounter Spirit Airlines Inc. and other smaller carriers should be eager to see fares climb as they face higher labor and fuel prices, said Andrew Davis, an analyst at T. Rowe Price Group, the largest shareholder at American, and an investor in United, Delta and Southwest.Historically, airlines have dealt with rising fuel prices by paring back capacity, Delta CEO Ed Bastian said last month.
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