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Cost of flying vs amenities

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Old Jul 30th, 2006 | 10:37 AM
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Cost of flying vs amenities

In 1990 I took a new job that entailed frequent travel from Boston to Columbus, Ohio. My company paid about $375 round trip for those flights. In today's dollars, that would be about $585, but USAir will sell me a ticket for September for less than $200. If we wonder why the airlines are in trouble and why we don't get many amenities on the flight, that might be the difference.
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Old Jul 30th, 2006 | 03:11 PM
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I totally agree. Something's gotta give & it will be more crowded seats, less food/drink & being treated more like Greyhound passengers.

We can't have it both ways.
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Old Jul 30th, 2006 | 03:18 PM
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If it is a short flight, I don't mind bringing my own food and drinks, however, don't put me on a plane for 6 hours plus and say, "food for purchase" and $5 drinks; especially when I can buy 4 wines at the store for $5.00.

But $200 is better than a half empty plane. And they usually charge premium prices for those last seats on the plane.
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Old Jul 30th, 2006 | 03:57 PM
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I don't really care for all that stuff but since I'm pretty much destined to be flying economy in the forseable future, I would just KILL for three inches for leg room.
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Old Jul 30th, 2006 | 04:14 PM
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crefloors - You don't need to kill anybody or anything. Just fly enough on UA to become an elite, or pay $299 a year, to get E+ seats.

And I wonder when AA had More Room Throughout Coach a few years ago, did you try to fly AA more?
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Old Jul 30th, 2006 | 06:34 PM
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I completely agree with you. The public has spoken with their feet. They are not willing to pay extra for steak, cold lasagna, beer, terrible wine, or mystery meat sandwiches. They just want the cheapest possible fare. The airlines delivered on this demand. There are still some who want the sandwich, the liquer, or the dinner. Challenge is they are probably not willing to pay for it..but they still complain about not having it.
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Old Jul 30th, 2006 | 10:31 PM
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For the 3&quot; more leg room you can simply fly <b><font color="blue">jetBlue</font></b> and sit in rows 13 thru 26 on their A320 (row 26 is the last row). Or get a roomy exit row seat (rows 11 and 12).
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Old Jul 31st, 2006 | 02:41 AM
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How come foreign airlines such as BA and VS have not had to resort to such idiocy as charging for drinks and provide superior entertainment even in coach for the same fares? Why fly AA JFK-LHR when you get 1000% better service on BA and VS? It's just contempt for the pax.
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Old Jul 31st, 2006 | 02:50 AM
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&lt;&lt;The public has spoken with their feet. They are not willing to pay extra for steak, cold lasagna, beer, terrible wine, or mystery meat sandwiches.&gt;&gt;

I don't understand how they've spoken with their feet, from my understanding all the airlines in the US scrapped food just about the same time and therefore what choice do you have except by flying first class which is considerably more expensive.

United saved themselves $30 million per year by scrapping food on US domestic flights, hardly earthshattering, let alone enabling them to reduce air fares significantly.

The problem that airlines had, was that they were overstaffed, overpaid, and had over capacity, this has been changing and they are able to adjust their fares due to a reduced cost base. Also the Low Cost carriers are keeping regular airlines 'more honest' in their pricing policies.

In Europe, airlines such as Lufthansa, Air France &amp; British Airways still offer full service including free beer and wine and as recent results show, they are still able to make huge profits, despite being up against very low fares from companies such as Ryanair &amp; Easyjet.

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Old Jul 31st, 2006 | 05:43 PM
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If Lufthansa, Air France, or BA were competing in the U.S. domestic market then their results would be different.
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Old Jul 31st, 2006 | 06:12 PM
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I flew Air France from Paris to Rome recently in coach, and &quot;breakfast&quot; consists of a cookie. My parents fly Aer Lingus AMS-DUB recently and coffee cost &euro;1.

The flying public in the US has indeed voted with their feet. If they have wanted full service all along, then Southwest would have shut its doors years ago. AA gave them more legroom a few years ago, and their load factor was about the same as other majors and fares were the same. CO still serve free food, and their load factor also remained about the same as others. Song gave them free TV and DL has to shut it down. Jetblue gave them free TV, new planes and decent legroom, and its stock prices has gone nowhere and was losing money for a while.

Time and time again, the only thing that works for the airlines is cut cost. To my eyes, the flying public had voted - they want low price, low price and low price.
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Old Jul 31st, 2006 | 07:58 PM
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I think you have compare Apples to Apples. International routes are high profit margin routes, and airlines can still afford to compete with amenities. U.S. domestic routes are highly competitive and price sensitive. Comparing European international routes to U.S. domestic routes isn't a fair comparison.

That being said, I've flown domestic routes on South American airlines (Lan Chile, Lan Peru, Aerolineas Argentina) and they've always served up food on even the shortest routes. Usually it's just a ham and cheese sandwich or a roll and OJ for breakfast. Of course, these are the national airlines for their countries and tend to be heavily subsidised. I'm not sure they'd be able to maintain their amenities in the competitive U.S. market.
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Old Jul 31st, 2006 | 10:48 PM
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&lt;&lt;My parents fly Aer Lingus AMS-DUB recently and coffee cost &euro;1.&gt;&gt;

Poor point, you know Aer Lingus is no longer full service as it competes with Ryanair, thats another reason its leaving One World

&lt;&lt;The flying public in the US has indeed voted with their feet. If they have wanted full service all along, then Southwest would have shut its doors years ago.&gt;&gt;

The regular airlines didn't try to compete with Southwest for a long time, therefore the price differential for the same destination was enormous. If you were a family of 4 going to Orlando, it would be a no-brainer, you'd choose Southwest everytime.

Now that the regular airlines have woken up to the threat of Southwest &amp; Jetblue to their business, the regular airlines have made some of the necessary changes to overstaffing, overpaying and over capacity, so that they are now able to compete with them on price. Food is almost irrelvant in their cost equation, and as xyz123 mentioned, I also think the US airlines are treating customers with contempt.

&lt;&lt;Jetblue gave them free TV, new planes and decent legroom, and its stock prices has gone nowhere and was losing money for a while&gt;&gt;

So your telling me that Jetblue is a more expensive airline to fly due to these new features, that's something I'm not aware of. Maybe its to do with other 'regular airlines' now being able to charge similar fares without losing billions in addition to having comprehensive frequent flyer miles programs.

&lt;&lt;If Lufthansa, Air France, or BA were competing in the U.S. domestic market then their results would be different.&gt;&gt;

Your right, they'd be better but they're not allowed to do it.

To the posters who think that the US domestic market is completely different to the European domestic market, I would like to know the reasoning.

In Europe you have a lot more airlines competing. You have Ryanair or Easyjet offering free flights or 99 cent fares every week. There are numerous other low cost carriers to pick from. These Low Cost Carriers as well as regular airlines are also extremely succesful as can be seen from their share price and profits

Geordie
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Old Aug 1st, 2006 | 03:24 AM
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I think Geordie poses a lot of valid issues. I just don't have the data to come up with a qualified answer. Certainly US airlines had bloated, hostile and underworked staff, USAir being a perfect example, that inflated the cost structure. They also used larger planes for longer distances, with higher fuel costs.

But I don't know the role of subventions and tax breaks in the UK/Europe environment, nor do I know the cost of airport taxes/landing fees and so forth in comparison with the US where such items are all locally controlled and seen as cash cows. Finally, and most controversial, it seems that Thatcher winning the fight against Scargill and the miners may have made unions more reasonable in the UK than in the past. Or maybe not. I find all this very interesting.
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Old Aug 1st, 2006 | 03:42 AM
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Do labor contracts vary between airlines?
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Old Aug 1st, 2006 | 05:08 AM
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When I pointed out about service of AF and EI in my post, I was trying to point out that the service in European mainline and discount carriers are little different from US mainline and discount carriers. In fact, their discount carriers have less service than US ones. That's why I give you two examples.

My point about Jetblue is that passengers are not willing to pay more for more service. If they are, then Jetblue will be packed to the gills, and making so much money; so is Delta. Instead, they have no pricing power to charge more. And their planes are no fuller than other airlines. So, there's really no competitive advantage to add extra service on the flight.

The European market is indeed very different. And they treat problems differently.

Just look at these three things that happened in Europe (or is happening) that can't happen in the US:

- Letting big carriers fail. Like Swissair and Sabena. Two national flags. Last time a large US airline closed its door is Eastern almost 20 years ago.

- Letting big carriers merge. AF-KL. They can talk about it here all day, but anti-trust and political pressure mean we still have 6 major carriers, which is about 3 too many here.

- Ask how much money the Italian government has put into Alitalia to keep it afloat in the past 30 years, or the Greek government into Olympic. The US has done some after 9/11, but the extent is much less.

- British Airways have majority of slots at LHR, and new carriers are prohibited to enter in that market.

Now, can you start to see there are significant differences in the markets?
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Old Aug 1st, 2006 | 06:06 AM
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rrkwan,
&lt;&lt;In fact, their discount carriers have less service than US ones.&gt;&gt;

Aer Lingus offers a hot breakfast to purchase as well as plenty of other fresh options, not just coffee. If you compare this against Ted as an example they offer only $5 food packs that are a crime against humanity.

&lt;&lt;Just look at these three things that happened in Europe (or is happening) that can't happen in the US:.........
Now, can you start to see there are significant differences in the markets?&gt;&gt;

No, I really don't understand your points about airlines failing, merging etc.

TWA &amp; Pan Am are barely in business and were very large carriers in the less 20 years.

US Airways has just merged with America West, and there are more in the pipeline, I'll keep you posted.

&lt;&lt;The US has done some after 9/11, but the extent is much less.&gt;&gt;

done some, your talking about bilions upon billions of dollars.

&lt;&lt;British Airways have majority of slots at LHR, and new carriers are prohibited to enter in that market.&gt;&gt;

Its called Supply and Demand and unfortunately Heathrow is full at the moment, that's one of the reasons why airlines are buying the A380. BA has always been the dominant carrier at Heathrow and and as you would expect, has the most slots. Just like Delta at Atlanta or United at Chicago

In conclusion, I think your arguments are pretty weak with regards to differentiating between the US and Europe markets, I was actually expecting a better effort.

Geordie
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Old Aug 1st, 2006 | 06:59 AM
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There's no need to be confrontational, Geordie.

My view is that comparing US legacy carriers to Euro flag carriers really is apples and oranges. BA serves how many mainline domestic stations - seven? And how many domestic mainline destinations does Lufthansa serve? Or Swiss?

The US airlines' business models are all about their domestic markets, whilst the European (and most Asian) carriers have to focus on international and longhaul markets. Domestic competition is intense in the US. How intense is it on LHR-EDI?

And what's the point of this argument anyway? Some people shop in Harrods' food halls, some at Tesco. Some ride on Easyjet and pay &pound;1 for a bottle of water, some fly in Club Europe and get a hot breakfast (along with 31&quot; seat pitch) for their overpriced flight to Malaga.

Last I checked, load factors were up pretty much everywhere, so evidently the price/benefit equation is working at something like equilibrium.

Don't like paying for a sandwich on a domestic flight? Groovy. Mickey D's awaits. Want a free drink? Fly on an airline that gives 'em. (And BTW EI isn't the only flag carrier that's going to pay-per-nip. SAS has started too.)

Enjoy your inflight service on EDI-MAN next time, too. What's that you say?
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Old Aug 1st, 2006 | 07:26 AM
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I think we have made our points pretty clear. No need to rehash.

However, I wonder what Geordie's suggestion is to the US airline executives? If Geordie has a great idea, I want to hear it.
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Old Aug 1st, 2006 | 08:20 AM
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I would vote with my feet, but since I'm tied to a second-tier, non-hub airport, I have NO CHOICE on many routes - there's no &quot;supply and demand free market&quot; outside the major city hubs -- you get what you get. And I too would kill for extra room, but since we're doomed to regional jets, that's naganna hapn. (And btw do notice how many cross-continental JetBlue routes are red-eyes, esp. coming from the West Coast.)
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