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Oil prices are going down. So why do airfares keep climbing?

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U.S. airlines are saving tens of millions of dollars every week because of lower prices for jet fuel, their largest expense. So why don't they share some of the savings with passengers? (www.stltoday.com) עוד...

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preacher1
preacher1 6
Like I said earlier, they ain't a charity. Pay or stay home.
WALLACE24
WALLACE24 3
Actually it's fairly reasonable. I can fly from BNA to west coast for few hundred bucks. That won't pay for the fuel in my pickup let alone 2 LONG days of travel, motel, and food. Is airline flying fun anymore? Not so much.
preacher1
preacher1 1
450 from FSM to LAX and stay a week, and that price includes one checked bag. I'm like Wallace 24. You can't drive it that cheap and to get out there same morning is a deal
devsfan
ken young 3
Because they can. And for the first time in many years, for some, decades, air carriers are profitable
One by one carriers merged, reorganized, gobbled up each other, reduced awards for frequent flyers, got rid of perks, reined in labor costs, reduced the number of flights, got rid of older less efficient aircraft, learned to turn over aircraft much quicker, etc.
For example AA issued a dividend to its stock holders for the first time in 34 years.
Who likes paying high fares, security hassles, baggage fees, fee fees( yes airlines charge you for charging you) So what? It's not the only way to get around.
I don't fly anymore because as in the past I used air travel on the logic of paying extra for the convenience. Flying is no longer convenient
blake1023
blake1023 5
Supply and Demand

Airlines have merged (less competition), consolidated routes and fleet types (supply went down). The demand for air travel has remained the same. Prices go up! Basic economics folks!
s2v8377
s2v8377 1
Sad but true.
devsfan
ken young 1
Its right back to where it was before deregulation.
Back then the major carriers, Pan Am, American, United, TWA, Delta, Northwest Orient all had protected routes and fares were controlled by federal regulators. This kept fares higher than most people could afford. Carrier managers could not care less. Their routes could not be infringed upon by other carriers.
Back then there were these small regional carriers which did not compete with the major carriers.
The only difference now is the small regional carriers are subsidiaries of the larger ones. Asd there are fewer of them.
The CEO of US Airways ( Douglas Parker) said consolidation is the only way the airline industry could survive. He also made a reference to there being too many competing airlines.
preacher1
preacher1 1
Planes keep flying because people want to go and air travel is the accepted norm to get there to any distance. Schedules and delays being what they are now in in years past, make a good case for corporate planes or charters if companies can afford them. There are many companies around that have corporate flight departments that are legitimate rather than personal toys of the CEO as was touted last year, in which Senior pilots work hand in hand with the CEO, doing what they can to fill the need the company has scheduling wise. This puts folks where they need to be, when they need to be there, and the CEO out of the logbook.

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preacher1
preacher1 2
time & schedule
joelwiley
joel wiley 1
When costs go up, the prices go up.
When costs go down, the prices go up.
See also Hobson's Choice
http://en.wikipedia.org/wiki/Hobson%27s_choice
WALLACE24
WALLACE24 1
Because we keep buying tickets.
preacher1
preacher1 1
preacher1
preacher1 3
and they are not a charity. Stay home if you don't like it.
tyketto
Brad Littlejohn 1
Not for nothing, but you aren't getting it.

This time in 1999 or 2000, I could fly SWA from KLAS-KLAX roundtrip for $29 each way. In 2005, when gas prices were roughly the same as they are now, it was $49 each way.

Today? $73 for the same trip, each way. 150% markup. That has nothing to do with if they are a charity or not. Now, I'm not complaining about SWA, as I'd take that flight, but IIRC, there were congressional hearings on such gouging sometime between 2003 and 2008.

You'd definitely hear more about this if oil goes under $50/barrel. That would put gas prices at under $2/gallon, which at that point, airlines were charging $19 each way for that same KLAS-KLAX run.

The question then becomes: How much gouging would you take since you would be complacent with it? For it sounds like you are.
blake1023
blake1023 1
Times have changed from the late 90s. I.e TSA (a tax passengers pay), thanks to Obama he's raised that tax ($5.60 per flight, or one-way) cause TSA does such a bang up job. Airports like DEN have doubled their landing fees, and raised taxes on aircraft parts. Less competition, lower frequencies on routes. It's more than just the price of oil.
WALLACE24
WALLACE24 0

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