[schaero]

Here's a suggestion to save all of our financially strapped airlines. I suggest that they all raise the price of soft drinks and water to $10 each, the price of movies to $25, the price of food to $50 per tray, the price of having a ticket agent wait on them to $100 and the price of their first piece of luggage to $200 (which by the way only encourages people to carry gargantuan bags onto the planes and try to cram them all into the overhead bins; pretty smart, huh?) They could also put coin slots on the display monitors to check for departures and arrivals, say $1.00 each viewing. And maybe another fee to use one of the chairs at the terminal gate, say $5.00 per hour? Then, once they have jacked up the prices of all the incidentals, the ticket itself could actually be given to the customer free of charge!!! Seems like an idea that might appeal to the airline marketing wizards, doesn't it??? Feel free to pass these suggestions along to all the folks who are so rapidly ruining what little positive image they have left.

I can hardly wait for all of the airlines to begin asking the government to bail them out because business has dropped off so much, never realizing that they actually ruined their own companies by “nickel and diming” their customers to death.

Now seriously, how did it not occur to the airlines to simply raise the price of each ticket $50 or $100 bucks, with an explanation that the increase was for additional fuel charges (which we all could have easily understood and related to), leaving soft drinks, water, baggage and movies free??? Of course, that wouldn’t have contributed to the airlines lousy image, which they seem so skillful at creating.

[AADFW]

The reason that any given airline won't simply "raise the fare" instead of charging more for value-added services is consumer price sensitivity at the time of ticket purchase. When consumers get online and see that Airline #1 has an airfare $45 lower than Airline #2, guess what happens? They're not thinking about the $25 luggage fee and $4 they're going to pay for that can of coke on Airline #1. As a result, airline #1 loses the passenger and all of the revenue.

LET THEM GO OUT OF BUSINESS! IT'S OK... REALLY!

What really needs to happen is for the federal government to stop bailing out the legacy carriers with loan guarantees, tax breaks, and other subsidies. Airlines are subject to the same laws of economics as any other industry. For some reason, consumers and our leaders in Washington seem wantonly ignorant of this fact whenever a major carrier is on the verge of bankruptcy. "Pseudo regulation" ensuring that legacy carriers can stay afloat on a permanent basis has resulted in artificial long lives for many, if not all, of the major players in the industry.

People need to understand this simple fact: all the airplanes aren't going to vanish into thin air if AA, UA, CO, DL, and NW all go out of business tomorrow. The equipment and demand for air travel will all still be there. Investors will come together -- quite quickly in fact -- and create new airlines with far more efficient business models. Planes will continue to fly and the world will not come to an end. In fact, widespread bankruptcy is precisely what the airline industry has needed for a long time. Without such change, there will be very little if any innovation or improvement in the areas of service and badly needed technological upgrades.

We also need to allow foreign carriers to compete without limitations of foreign ownership in the U.S. (No, Virgin America is not majority foreign owned). Policymaker claims that doing so would put national defense at risk in time of war are flat out wrong. For one thing, we can make wartime operational compliance requisite at the time of market entry, but bottom line, if Uncle Sam needs airplanes to move troops, the French Prime Minister can kiss his ass if he decides to commandeer an AF 747 or two.

The alternative, at least in terms of improving service, is very heavy regulation limiting the number of carriers and flights per route, etc. so that carriers could compete more on the basis of service than price. That is how most international routes work for now, and it's what former AA CEO Bob Crandall says should happen to the industry in the U.S. But going back to regulation would drive up fares such that most people wouldn't be able to fly nearly as often as we do today. You'd see sale fares from Dallas to New York of $900 or more round-trip, for example.

[onisagi]

The industry definitely needs an overhaul, the current companies are feeling too secure on their thrones for any type of improvement to take place. Overhaul may be a bit extreme, it'll be best if the current companies can simply sense the threat of competition and move strategically towards better service.

[airhead]

Back in the good ole days of government regulation, the price of the ticket (which was very expensive compared to today's standards) included all amenities. But the general public wanted a more diverse competitive industry so President Carter deregulated the industry with the help of many lobbyists.

In the 80s, the industry still operated under such premise of the old regulated theme. The ticket prices dropped a bit but the vast majority of Americans still could not afford to fly. Still, the airlines operated with a large profit. The few flying could appreciate open seats and free meals for the price they were paying.

In the 90s, technology advanced the reservation system and opened more doors to more markets. Competition grew but everyone still knew that the value price of the ticket included everything. Discount fares starting rolling out and many more people were attracted to flying. Many more could afford it since the economy was doing great.

2000, competiton became fierce and many airlines' profit margins began to shrink. September 11, 2001. A terrorist attack caused great losses across the board. Since airlines were making less profits, the availability to cash was reduced and many sought bankruptcy protection. Still the airlines wanted to provide something for the ticket price to entice more people to fly again.

2007, the airlines were barely regaining financial strength as record numbers of passengers were flying. tickets were really cheap at this time. But the strange weather patterns were once again exposing the weaknesses in the booking system.

2008, the price of fuel is up the roof and other economic problems plague the American people. As a result, less people are buying tickets. People are extremely price sensitive, yet the demand for flying is still greater than it was a couple of years.

The airlines respond by charging for things that were free for years to reflect the open market. Now passengers are complaining because they feel they should get the cheapest price possible price for a ticket but should still everything for free. Yet every other industry charges for add ons and since these other industries are not known for "giving stuff away" it is ok. The airlines now a have a reputation for cheating passengers but in reality it is only providing for services that are paid for just like any other company.

When GM introduced the Chevrolet, it was a bare bones model withnothing, yet is was the biggest seller. Americans seem only concerned with the cheapest price but when service is taken away, it causes a real stink. Why is that?