Airlines are in a Death Spiral; Is There a Solution?
#1
Airlines are in a Death Spiral; Is There a Solution?
The airlines are doomed. Every time their costs go up, they scramble to stay solvent by raising prices, adding fees, cutting services, and reducing staff and flights. Each of these cause fewer customers to buy tickets, lowering revenue, and then the airlines go through another round of increased fees and reduced services.
The cuts reduce business, cuts make services both less available and less attractive, more business is lost as the ticket prices go up, without end. Is there a way out before we have to go back to long distance bus and train travel or stay home?
The cuts reduce business, cuts make services both less available and less attractive, more business is lost as the ticket prices go up, without end. Is there a way out before we have to go back to long distance bus and train travel or stay home?
#3
Join Date: Sep 2003
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Part of the problem stems from the fact people don't want to pay higher prices for air fare. Therefore, quality of service goes down, while costs go up including fuel, salaries, etc.
The price of airline tickets really haven't gone up much in the last 25 years. I remember paying $300 to go from east to west costs in 1983 and today you can still get tickets for the same price or not much more. So who suffers in the end? The people who want the cheapest flights they can get, and then complain we are packed in like sardines, get peanuts for a snack.
The airlines are constantly being squeezed to provide service at such deep discounts to compete with other airlines, they are going broke (if not already). If the airlines don't offer cheap flights, people will fly elsewhere.
I don't see how long this can go on without all airlines increasing their prices substantially. I am one person willing to pay much more for a flight to keep the airline in business ONLY IF they can provide excellent service. This cannot happen under the current situation.
And now with the economy so bad it just magnifies an already bad situation.
The price of airline tickets really haven't gone up much in the last 25 years. I remember paying $300 to go from east to west costs in 1983 and today you can still get tickets for the same price or not much more. So who suffers in the end? The people who want the cheapest flights they can get, and then complain we are packed in like sardines, get peanuts for a snack.
The airlines are constantly being squeezed to provide service at such deep discounts to compete with other airlines, they are going broke (if not already). If the airlines don't offer cheap flights, people will fly elsewhere.
I don't see how long this can go on without all airlines increasing their prices substantially. I am one person willing to pay much more for a flight to keep the airline in business ONLY IF they can provide excellent service. This cannot happen under the current situation.
And now with the economy so bad it just magnifies an already bad situation.
#4
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If its any consolation, I am making what I did in 1996;have lost most of my benefits;husband lost his pension after 31 years,etc. so remember that those of us who are still working for the airlines are truly trying to make it work for you despite it all!
#5
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dutyfree, I believe you - every person tht I have had to deal with with the airlines has been wonderful - frequently harried and overworked, but trying to do their job (like any industry there are exceptions, but that's rare).
How about some kind of regulation? Seems like since deregulation, there have been problems.
How about some kind of regulation? Seems like since deregulation, there have been problems.
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<i>Seems like since deregulation, there have been problems.</i>
And pesky problems like dramatically lower airfares, at that!
No thanks. I will keep my low airfares, even if it means less service.
And pesky problems like dramatically lower airfares, at that!
No thanks. I will keep my low airfares, even if it means less service.
#7
People really have been lulled into unrealistic expectations ever since Sept. 11 and the airlines' collective price-cutting in order to recover lost passenger traffic. In "real" economic terms (i.e. "constant dollar" most airfares are something like 1/3 to 1/2 what they were prior to US deregulation.
"The airlines are doomed?" Baloney. Some might be for sure, and others might need to re-examine their business plans, but the market will simply seek and stabilize at some equilibrium point, just like always. Maybe it will cost more to fly casually from some place to another, but exactly what things <i>do</i> you expect to stay constant-priced or decline in price over the next couple of years? Besides a share of GM stock, that is?
Some people would argue that deregulation just stopped a bit short. Maybe if we ditched Bermuda II, or let foreign investors own majority interests in domestic airlines, or ditched cabotage laws altogether.. who knows?
<i>Is there a way out before we have to go back to long distance bus and train travel or stay home?</i>
Sure. Save more and expect to use the savings on flights in the future. Taking the bus or the train to Australia is going to remain a really complicated process.
"The airlines are doomed?" Baloney. Some might be for sure, and others might need to re-examine their business plans, but the market will simply seek and stabilize at some equilibrium point, just like always. Maybe it will cost more to fly casually from some place to another, but exactly what things <i>do</i> you expect to stay constant-priced or decline in price over the next couple of years? Besides a share of GM stock, that is?
Some people would argue that deregulation just stopped a bit short. Maybe if we ditched Bermuda II, or let foreign investors own majority interests in domestic airlines, or ditched cabotage laws altogether.. who knows?
<i>Is there a way out before we have to go back to long distance bus and train travel or stay home?</i>
Sure. Save more and expect to use the savings on flights in the future. Taking the bus or the train to Australia is going to remain a really complicated process.
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