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Cessnaflyer

Airlines vis-a-vis Passengers

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Well thats because people won't pay the proper amount for an airline ticket.

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What's the "proper" amount for an airline ticket?

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>What's the "proper" amount for an airline ticket?One that is higher than cost.

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When it is cheaper to take an airplane some where then a bus then you know something is wrong.

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Why is it wrong for airfares to be less than bus fares - or indeed any other fares susch as railway?

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Nothing, as long as you are making a profit. Profits are what make the business world go 'round and 'round...........take away profits and you take away the incentive to service the customers.It's all about the money.............

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"Why is it wrong for airfares to be less than bus fares - or indeed any other fares such as railway?" Because you cannot pull an airplane over to the side of a cloud. Safety is not cheap, remember,you get what you pay for:-)

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Indeed you can't pull over to the side of a cloud, but operating costs include much more than safety aspects and isn't a reason for air travel to be more expensive than other modes. The fact is budget airlines in Europe have deveoped a very efficient (financially) business model by abandoning the dreadful practices of the traditional airlines - that's why many of the latter are in financial difficulties. Rail fares in the UK are sky high despite government subsidy - but that's because it is an inefficient operationg with little real competition.

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>Indeed you can't pull over to the side of a cloud, but>operating costs include much more than safety aspects and>isn't a reason for air travel to be more expensive than other>modes. The fact is budget airlines in Europe have deveoped a>very efficient (financially) business model by abandoning the>dreadful practices of the traditional airlines - that's why>many of the latter are in financial difficulties. Rail fares>in the UK are sky high despite government subsidy - but that's>because it is an inefficient operationg with little real>competition.You cannot compare European airfares to US Domestic ones. US Domestic carriers average stage lengths are usually double what the European ones are.The problem is simply the fact that the internet and the LCC's have finally removed pricing power from Legacies. The legacies simply bleed cash now because they price to compete with the LCC's. It doesn't help when start ups like Skybus and Go! flood the market with cheap seats on the backs of their cheap labor. Also, the US Govt. subsidizes Delta, US Airways x2, Continental x2, NWA, United, etc through the bankruptcy process. This simply allowed them to dump debt and slash employee benefits and wages.

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"The problem is simply the fact that the internet and the LCC's have finally removed pricing power from Legacies."That's not a problem - it's a good thing. It's put pricing power back where it belongs with the consumer by taking it from the airlines. The airlines loved the old days when they operated cosy cartels. At one time only two carriers were allowed on the London-Paris route and they pooled their revenue. More recently, before 1 April this year, only British Airways, Virgin Atlantic, United and American Airlines could offer direct flights from Heathrow to the US because of cosy cartel agreements. you refer to cheap labour - how do you define that?

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>That's not a problem - it's a good thing. It's put pricing>power back where it belongs with the consumer by taking it>from the airlines. The airlines loved the old days when they>operated cosy cartels. At one time only two carriers were>allowed on the London-Paris route and they pooled their>revenue. More recently, before 1 April this year, only British>Airways, Virgin Atlantic, United and American Airlines could>offer direct flights from Heathrow to the US because of cosy>cartel agreements. IT IS THE EXACT PROBLEM.They are simply dumping capacity already onto an already filled to capacity market further driving prices down. It wasn't cosy "cartel" arrangements wrt to international routes, but government treaties.What Go! did to Aloha was borderline criminal in its price fixing. The "market" in aviation is a "myth". There is no FREE market. It is a price fixing scheme which the larger carriers match extremely low fares to try and save market share. The airlines CAN NOT control themselves.And YES cheap labour from the startups is a FACTOR. Take Allegiant for example versus US Airways out of LAS. Allegiant has ZERO pilots/fa's/mechanics on 5 year vacation, benefits, pay, etc. But hey, US Airways got to be subsidized by the US taxpayer TWICE in the last 5 years.

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>What Go! did to Aloha was borderline criminal in its price fixing. IIRC Aloha was involved in trying to squeeze out Pacific Wings, so it's a two-way street.scott s..

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Governments entered into those treaties under pressure from the airlines involved - the governments didn't think them up all by themselves. When it was proposed to change the treaties those airlines complained bitterly.Why shouldn't a low cost budget airline not offer lower fares than the legacy carriers? If the legacy carriers can't match those fares then they should get out of the business like any other uncompetitive firm.I've no doubt cheap labour is a factor but wht's wrong with cheap labour - apert from the fact unions don't like it?I gree that the the taxpayer shouldn't subsidise an airline - it should be left to sink or swim on its own.

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>Governments entered into those treaties under pressure from>the airlines involved - the governments didn't think them up>all by themselves. When it was proposed to change the treaties>those airlines complained bitterly.>>Why shouldn't a low cost budget airline not offer lower fares>than the legacy carriers? If the legacy carriers can't match>those fares then they should get out of the business like any>other uncompetitive firm.>>I've no doubt cheap labour is a factor but wht's wrong with>cheap labour - apert from the fact unions don't like it?>>I gree that the the taxpayer shouldn't subsidise an airline ->it should be left to sink or swim on its own.Do you live in the UK? If so, why not allow more immigrants in to keep wages down and allow the British economy to grow? It's no different over here. Non-cabotage language has been in place for awhile because aviation is a "national security matter".If the companies can properly "market" their product then DO NOT hamper the workers rights and allow us to properly strike and not be subject to the antiquated RLA (again under the ruse of national security). It is not a two way street.Successful low cost carriers are a rarity in the US domestic market. Most bleed so much initially that they are gone in a heartbeat. Others were specifically setup to circumnavigate labor contracts (New York Air for instance). It's not only their cheap labor, but the government also robbing from the rich (AA and United) to pay for the poor (JetBlue): AA/UA were REQUIRED to give up THEIR slots at ORD due to "congestion" only to have uncle sam give them to JetBlue. This isn't fair competition. The legacies are no better as they simply fall into their "market share" trap and further tap into their employees pockets. They cannot keep doing this forever.European airlines are now putting 250hr wonderkunds into the right seats of some large airplanes (like that chick who almost crashed the airbus for Lufthansa). This is where your cheap labor and a loss of "professionalism" will lead you to. Do you want "cheap" labor upon an engine failure or for that engine retrofit? Cheaper is not always better.

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>>What Go! did to Aloha was borderline criminal in its price>fixing. >>IIRC Aloha was involved in trying to squeeze out Pacific>Wings, so it's a two-way street.Pacific Wings is originally a Nevada based airline and is hardly an apples to apples comparison. Aloha and Hawaiian were the two primary competitors in this market until the ex-con Ornstein decided to illegally look at their books and open up shop.

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We are not going to agree. I believe that airlines are just another business subject to market forces in the same way as any other busineess and neither them nor there employees deserve any special protection. Times change and companies and their employees must change with them if they are to survive. I'm not alone in this. The EU policy is based on this. Government aid to airlines is no longer generally allowed in the EU.As the the argument that a pilot with say 2,500 hr expereience is beter than one with 250h dosen't necessarily follow. He may in fact only have 250hr experience ten timesover!

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CRJ700Fo, you cannot argue with people that haven't been in our shoes,let them try Nights,weekends,holidays,dealing with idiots in dispatch,maintenance control,idiotic empty suit management,extreme heat,cold,no parts,to many mel's,greedy CEO's,FAA looking over your shoulder all the time,responsible for the lives of crying,jerry springer passengers,more paperwork than a doctor. People outside of our jobs are clueless! Oh yes ever dwindling pay,that does not keep up with inflation.Did I miss anything:-)

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I can't think of any industry in the US right now who's pay is keeping up with inflation.........other than the bonuses of the CEO's that run these failing corporations, most people's purchasing power is dwindling.Kind of a "catch 22" isn't it? Airlines need to increase their fares to survive, yet when they increase such they lose passengers (either to competitors or passengers leaving flying all together).........thus sending them further into debt.

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>CRJ700Fo, you cannot argue with people that haven't been in>our shoes,let them try Nights,weekends,holidays,dealing with>idiots in dispatch,maintenance control,idiotic empty suit>management,extreme heat,cold,no parts,to many mel's,greedy>CEO's,FAA looking over your shoulder all the time,responsible>for the lives of crying,jerry springer passengers,more>paperwork than a doctor. People outside of our jobs are>clueless! Oh yes ever dwindling pay,that does not keep up with>inflation.Did I miss anything:-) All businesses have problems. What you say may well be true but it doesn't give any reason to treat airlines differently from any other business by giving them and their employees special protection. Times change and business have to change with them or go under - that's the way of the world.

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Given the apparently insurmountable problems with fuel supply, costs, security and the overall unpleasantness of mass air travel- one has to wonder if we are witnessing a major economic shift.Popular, cheap air travel may well be a sunset industry- and flying may again, become economically available to only those who can afford a premium price. I'm old enough to remember the query "Wow- Did you really fly? What was it like!"Alex Reid

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Well,I left the industry,and a lot of fellow mech's are following.With the dwindling experience levels,and outsourcing,the safety margin is decreasing.I guess when there are enough smoking holes in the ground,mech's will be paid more money again. Most of the guys I work with now,(subway trains)are highly experienced airline guys who are sick of the industry.

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>All businesses have problems. What you say may well be true>but it doesn't give any reason to treat airlines differently>from any other business by giving them and their employees>special protection. Times change and business have to change>with them or go under - that's the way of the world.This isn't some "business". It ALREADY has SPECIAL privileges ALL on the management side. We cannot simply go on strike like ANY other "business". The government has eliminated ALL of our bargaining power and simply allows excess capacity to flatten the market.If aviation were a true "market": Continental, US Airways, America West, Delta, NWA, United, etc. would all be GONE. There is no "marketplace" in aviation.It isn't treating them differently now, they are ALREADY treated differently in the US.

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BIGSKY- Subway trains may turn out to be a wise career choice!Mileposts in the news:June 2007- Alan Greenspan-retiring Federal Reserve Chairman says in his biography that he believes the US can cope with $70 oil.May 8/08- Merrill Lynch reports fuel now accounts for 40% of total airline costs.May 8/08- The Iranian oil minister is quoted that he expects oil to soon reach $200 per barrel.May 9/08- Oil reaches $126+ per barrel.Alex Reid

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It's a bad situation - high labor costs and high fuel costs = higher ticket costs. Higher ticket costs (the ones airline employees want)= fewer passengers. Fewer passengers = layoffs. Layoffs = unemployed airline workers. The reason there are so many airline employees now is that the cost of flying could be afforded by just about everyone. Change that back to the way it was pre-1960s, and you're going to have a LOT of workers that have to be let go. Hmm So what IS the answer?Another perspective - I hear a lot of airline employees who say that ticket prices are way too low. Most (not all) of these same people fly for free.I hear AA employees wanting the company to restore the pay cuts they took after 9/11, plus new pay increases on top of that. At the same time, the price of fuel is more than twice what it was at that time, so the company is starting to hemorrhage cash - again. The idea of traveling is going to change, the way we're headed. It'll be too costly to fly OR drive for many families. That leaves trains and buses, which, of course, also rely on petroleum. See what happens when those employees decide they deserve more, too. There's always the bicycles. ;-)

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