So... What's The Deal With Continued High Fares? | Aero-News Network
Aero-News Network
RSS icon RSS feed
podcast icon MP3 podcast
Subscribe Aero-News e-mail Newsletter Subscribe

Airborne Unlimited -- Recent Daily Episodes

Episode Date

AMA Drone Report

Airborne-Monday

Airborne-Tuesday

Airborne-Wednesday

Airborne-Thursday

Airborne-Friday

Airborne-Unmanned w/AUVSI

Airborne On ANN

AMA 10.12.17

Airborne 10.16.17

Airborne 10.17.17

Airborne 10.18.17

Airborne 10.19.17

Airborne 10.13.17

Airborne-Unmanned 10.17.17

Airborne-YouTube

AMA 10.12.17

Airborne 10.16.17

Airborne 10.17.17

Airborne 10.18.17

Airborne 10.19.17

Airborne 10.13.17

Airborne-Unmanned 10.17.17

NEW!!! 2017 AirVenture Innovation Preview -- YouTube Presentation / Vimeo Presentation

Tue, Nov 11, 2008

So... What's The Deal With Continued High Fares?

May Counters Airlines Are Still Hurting, Despite Recent Windfalls

On the heels of its story about so-called "dropped" fuel surcharges, USA Today also took the airline industry to task for adding still-more confusing fees when fuel prices were rising, then failing to share falling fuel costs with customers.

The op-ed piece notes a nationwide survey by AAA finds regular unleaded auto fuel averaging $2.30 per gallon this week. Jet fuel has followed suit, at $2.16 cents, down 45 percent from its peak in July.

USA Today says fees for a traveller's first checked bag should be dropped in response, but notes Delta just announced it will become the sixth major carrier to do so, effective December 5.

The paper states, "We're sympathetic to the industry's financial plight after a year of soaring fuel costs, which have created steep losses. And customers' obsession with finding the lowest base fares on the Internet makes it hard for carriers to cover costs on competitive routes. But it looks as though some airlines have become addicted to the money the surcharges and add-ons bring in, and they're not about to let go.

"If airlines expect customers to put up with surcharges and pesky add-on fees blamed on high fuel costs, both should bear a strong relationship to fuel prices. That's no longer the case. Passengers deserve an explanation, or better yet, a break."

In his reply to the USA Today editorial, James May (right), President and CEO of the Air Transport Association, counters that airlines, "...have not come close to earning back what they lost, and their fares have not been able to keep up with the overall rate of inflation. Unfortunately, US airlines have been profitable only in two years since 2002.

 "Even if prices stabilize and the industry is marginally profitable in 2009, it will take much more than a year or two of profitability to recover from prolonged losses and to restore badly needed financial stability."

As for the ala carte fees which have become the industry norm in the past year, May echoes the findings of Robert Buckman, Director of Airline Distribution Strategy for Amadeus IT Group.

In an ANN Feature Aero-Cast last month, Buckman told ANN while the media has decried the separation of optional services into ala carte fees, consumers find it advantageous. May agrees, saying customers have shared with the airlines that many prefer a menu of services they can pay for separately in return for lower fares.

May adds that airline tickets sold months in advance must allow for unpredictable costs, and permit the airlines to make necessary future investments.

"Ultimately, it is competition in this marketplace that will best determine how airlines price their products."

FMI: www.airlines.org, www.usatoday.com

Advertisement

More News

RFP: ANN Seeking New Site/Facility For Major Studio Upgrade

It's Official: Aggressive Upgrades For New Airborne Programs WILL Require New Digs It's been in development for years, but we're getting to a point where we think we can pull off s>[...]

AMA Drone Report 10.12.17: NTSB--Drone v Blackhawk, City Drops Reg, DJI Privacy

Also: PassengerDrone, FAA Reauthorization Extension, UAS Pilot Certification, Workhorse Surefly The NTSB is now offering public details of the alleged collision between a hobby dro>[...]

Airborne-Unmanned 10.17.17: Eagles v Drones, DJI AeroScope, Drone Policy

Also: AeroVironment Award, Washington State Patrol, Altavian Nova UAS, Robotaxis The French Military is training four Golden Eagles to attack drones in flight as a way to defend ag>[...]

Airborne 10.18.17: Airbus C Series Deal, Red Bull!, Drone v Airline

Also: Glasair 2 And 3 Sold, Send Solutions, Blue Angels, SSBJ, D8 Airliner, Stage 5 Aircraft, Global Supertanker Airbus SE and Bombardier are to become partners on the C Series air>[...]

Airborne 10.17.17: Waco YMF-5F Flies!, SpaceX Streak, BBJs Rule

Also: Embraer, Aero-Calendar, AeroVironment, Sikorsky Heli's, EASA Singapore, FireFighting UAV, WestJet The amazing craftsman of the Waco Classic Aircraft operation in Michigan hav>[...]

blog comments powered by Disqus



Advertisement

Advertisement

Podcasts

Advertisement

© 2007 - 2017 Web Development & Design by Pauli Systems, LC