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january

Are the airlines low fare 'good o'le days' over?

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The fares are still going to be about 10% cheaper then they were during regulation. I say keep bringing them up until they can finally make a profit.

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Yes and no.The days of extremely cheap fares are probably gone or going soon. People will no longer be able to fly away for a weekend or jump on a plane for a business meeting.We are going to go back to fewer people flying and justifying a trip being a bigger deal in companies and for individuals/ families.But on a relative scale as noted above - air fares will still be cheaper than they were back 30 years ago.The real issue in my opinion isn't the increases in the price of airline tickets - but what happens to the ability of people to afford flying once all the higher energy costs work their way through the system and food, clothing, etc. cost 20-25% more than today as those costs for transportation and store heating and cooling gets fully added into retail prices.

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I wonder if it would be better for an airline to have 1 flight a day on say a 767 from a particular airport or 6 flights in a RJ. For Exampleinstead of 4 Flights from KCHS to ATL daily using CRJ200 One Flight A Day in a 767 Same amount of people with less fuel, less, pilots, less less airplanes, less maint. etc....

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I think if oil prices stay above the $125 mark for very long, we're not going to recognize the airline industry in a year...and there will be much less of it.I think this is more than just a speculative oil price runup...lots of data out there to suggest we've finally hit the wall of limited and declining worldwide production. If that's true, flying may well revert to be something for the wealthy.Honestly, it's gotten to be such a pain in the a** anymore, with the unreliability, rude employees, and security processing that resembles processing of cattle through a stockyard, that I'd rather not fly unless I really have to anyway.Sad commentary from a professional pilot, but I think the airlines are zombies going through the motions without realizing that they're already dead.RegardsBob ScottATP IMEL Gulfstream II-III-IV-VSantiago de Chile

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Bob- I have to agree and it looks like the auto companies are also seeing the trend- GM just announced permanent closure of 4 more plants including their most efficient light truck assembly operation. I'm old enough to remember streetcars and steam locomotives- and the era when at 20-25 cents/gal, gas was too expensive other than for very special occasions, such as a high school grad dance! Perhps Bombardier saw the trend years ago when they got into the mass rail business.Alex Reid

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Where I live I pay about the equivalent to about $1.80 US per liter for gas.And do you know what? There are still a ton of cars on the road (I know because they're all trying to crash into me :-) )So even though the crisis facing aviation is more structural than perhaps cyclical this time around, I don't know if I'd call it lights out yet for the airline industry. People still need to fly, although, quite frankly, if time is not an issue I'd rather take a cruise ship for many of the same reasons Bob mentioned.Bryan

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Several news sources over the last month have given that a number of economists have predicted that unless there is some relief in fuel costs there will not be ANY airlines by late this year, or into the middle of 2009. Aviation as we know it may be over unless the situation changes. There are solutions in my opinion, but that's a political topic probably best not discussed on an aviation site :-) Mike

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Hi, Bob and everyone.While I do agree that the Airliner's hiring is on hold right now, things will change again, based on demand. We are traveling more, longer distances and this will again start the up cycle. When? Hard to say.As far as Oil. There IS enough oil, the problem now is the Petroleum / Oil companies, CEOs, that want more and more profit, and oddly enough, if you look at the data, it

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10 Largest Crude Oil Producers - 2006(annual million bbl)1. Saudi Arabian Oil Co - 3,2482. National Iranian Oil Co - 1,4053. Petroleos Mexicanos - 1,3324. Petroleos de Venezuela - 9355. British Petroleum - 9036. Abu Dhabi National Oil Co - 8947. Exxon-Mobil Corp - 8328. Petro China Ltd - 8309. Nigerian National Petr. Co. - 81010. Kuwait Petroleum Co - 803So everyones' favorite boogie man, Exxon, is No 7 (only US oil company on the list).Source NRCan Fuel Focus Oct 26. 2007It would appear that the CEOs in question answer to their national governments.Also US Crude refining capacity:1985 15.671 Million bbl / day2007 17.447Source US Energy Information Administration, DoEI read that Southwest airlines have hedged about 80% of their fuel needs for 2008. That's why you hear "fees don't fly with us".scott s..

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Hi Scott.I will not try to convince you that the Oil companies are making a record PROFIT, I am not talking about total sales per say. You can look for more, if you are interested, but I am sure it will make no difference to you. Why should they get Tax subsidies and Not reinvest that money? Because we are stupid and they are crooks? Acquiring money, without earning them, it

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I guess I don't see how increasing taxes will do anything for the airlines, other than create a source of income for politicians to mismanage.scott s..

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Companies/corporations don't really "pay" taxes. Taxes are simply built into the price of the product and so are actually paid by you and me- the customers. The only real way to reduce the price of a commodity is to reduce the demand for it. Alex Reid

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Hey I got an Idea!!!! Why don't the oil companies buy the airlines.....then they could use there own fuel !!!!!!!!PS. what if your widget company started making a great profit and someone said it was too much so they taxed it.....?

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Air Canada today announced a large round of lay-offs, of which many will be pilots. AC cited high oil prices.There's a thought by some that this is management scare tactic because contracts will be coming up for renegotiation soon, and they need a pretext to start demanding concessions.My personal feeling is that things are going to get very interesting over the next year...(By the way, I'm now paying about $1.90 US per liter for my car, which I think works out to over $7 per US gallon :-( )I don't necessary blame this on greedy oil companies. I'm more inclined to assign it on Chinese and Indians who want to start consuming like westerners.-Bryan

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Bryan- As a contrast, WestJet (Air Canada's competition) says they plan to ADD some routes in coming months and anticipate no further fuel surcharge for the present. West Jet has an informal motto re utilization- "Use us or Lose us".Remarkble what Employee Ownership and operating only one aircraft type (737NG) can do for the bottom line.Alex Reid

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Southwest, US' sister airline to WestJet, is also fairing well as of this day by using the same methods. Funny that the airlines that started as low cost airlines are weathering this economic storm better than it's "first class" counterparts. It helps to know what your strenghts and weaknesses are.

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I take it Southwest and Westjet hedged their fuel while it was still relatively cheap?It's so hard to say where all this will end. It's too bad because the airlines where just starting to make a profit, and now it appears they're about to get hammered again in a very big way by surging fuel costs and slowing global economy.I guess it's just a reminder that all booms usually end badly.Even the Royal Bank of Scotland seems to be saying so...http://www.telegraph.co.uk/money/main.jhtm...18/cnrbs118.xmlBryan

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>I don't necessary blame this on greedy oil companies. I'm>more inclined to assign it on Chinese and Indians who want to>start consuming like westerners.>>>-Bryan>And, as we are discovering, their governments heavily subsidize the price of gasoline, which keeps demand much higher than it would be otherwise. I'd be interested in what they're paying after subsidies per gallon in USD.

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United just announced they are furloughing 950 pilots...14% of their pilot inventory. This really is the beginning of a real disaster for the airlines, and for the economy and nation as a whole.The price of energy is wreacking havoc in an economy that was designed for cheap energy costing less than half the current price. How we have structured our cities, the exurban sprawl, the vehicles we drive on borrowed money, the monstrous houses we live in on borrowed money, the fabulously expensive college educations we finance with borrowed money...it's all becoming a massive sustainment challenge that many, many Americans will eventually lose.Debt is the real enemy before us, and the enemy is everywhere we turn, living with us, sleeping with us, and now dominating us. We did this to ourselves, not the Chinese or the Indians. The solution is no further away than what it takes for us to live within our means.On a happy note, the problems with air traffic congestion are about to take a giant step towards resolving themselves...RegardsBob ScottATP IMEL Gulfstream II-III-IV-VSantiago de Chile

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<>>On a happy note, the problems with air traffic congestion are about to take a giant step towards resolving themselves...Now thats what I call Positive thinking!!!!!!!

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Well, the Chinese just lifted some of their subsidy, and from what I gather the Chinese took it in stride.As mentioned, I pay about $7 USD per gallon, and there are still a ton of cars and SUVs on the road here.I know that's a very sweeping and very simple generalization, but people need oil and I think we will keep buying it regardless of the price. People will just make cuts elsewhere.It's like food and water almost. You have to have it regardless of what it costs.Bryan

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And one area where people are cutting expenses is travel, especially air travel. Which has become both expensive and annoying at the same time. Unfortunately this decrease in ait travel will further increase the airline woes and cause even more furloughs in the near future. It's going to be a viscious domino effect for some time to come.John

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