Interesting article on the future of airlines and airfares

[CarolA]

http://www.nytimes.com/2002/08/18/business/18AIR.html?pagewanted=1

The article makes a lot of points that might be interesting concerning future airfares and services.

 

[hercamore]

Carol,

can't get the link for the article to work.


Herc.

 

[CarolA]

Hmm. it works when I click on it, but it could be pulling it out of my memory. I will try it from my home PC this evening and see if I can figure it out.

 

[sgtdisney]

Carol, it worked for me... It was a very interesting article, thanks!

 

[CarolA]

I think the problem is on the NY Times end of this link. I can't get thier web page to open up at all now!

 

[CaliforniaDreaming]

Can someone post the article here? Or, tell us a little about what it said?

Thanks.

 

[ncligs]

It won't work for me either. It takes me to the NY Times sign in page.

 

[CarolA]

Well the article is 3 web pages long so I don't think I can copy and post!


The basic point is that the NY Times writer believes that the airlines are going to actually become more like Southwest. It also points out that business travelers have more tools to use now to help them get lower fares and they are less likely to pay the full fares that the airlines depend on for discounts.

Below is a summary of the article I got from the USAToday web site.

A la carte pricing? Airlines could charge for perks
Air travelers are currently enjoying fares that are hovering near all-time lows. And while a dramatic rise in prices doesn't appear imminent, fares soon might not be worth what they once were, according to report in The New York Times. With the industry counting its losses in the billions, several of the nation's largest airlines have announced dramatic changes to their business models — changes that promise fewer flights, longer connections and reduced perks. Major carriers have traditionally charged higher fares to business travelers for tickets with fewer restrictions, and boosted those fares first to help make up revenue during times of weak demand. But corporate travelers finally revolted during the last downturn, aided by tools such as the Internet that have allowed them to book travel at leisure class fares. "Overnight, the airlines lost control of their product," one analyst told The Times. Now, some airlines are rethinking their fare structures as they struggle to maintain marketshare against successful discount airlines like Southwest and JetBlue. Among the possibilities are charging extra for amenities such as aisle seats or for quicker connection times. "Right now, you just don't see the difference" between full-fare and discount tickets, said Booz Allen travel manager Douglas Weeks. "If you were able to say, `I paid three times the discount fare because I wanted an aisle seat and frequent-flier miles,' then maybe it makes sense."

I don't know if this will work either, but this is the link to the USAToday page that linked me to the NYTimes orginally. (by the way, I am a registered member of the Times page, I don't know if that is required or not.)
http://www.usatoday.com/travel/today/sky.htm

 

[ncligs]

CarolA,

Thanks for the info.......and the new link worked fine.

 

[adamak]

Great article. I agree with everything it says. Airline business needs to really change its attitude or else they'll all go belly up. I'm very frustrated with the airlines.

Most big airlines say they cannot afford to make money and provide good service at the same time. Well, I think that's all BS. Look at JetBlue. They make money, and I actually enjoy the flight.

The big airline makes money by overbooking, by charging last minute tickets 1000 times more than what a sane person would pay, and think people are stupid enough to pay full fare. Gee.

Seriously, unless you're travelling on business, who would ever pay $1500 for a NY-Orlando trip? Why not do the JetBlue way, everything is lay down, simple, straightforward. It's also more sincere, as in "I'm not taking advantage of my customer" way.

USAir used to have multiple flights flying same route within an hour of each other. Then cancel one of them last min (they do not alert you), jammed the 2nd flight into the 1st flight. Whoever get bumped, too bad. You wait for the next one. Forever. It happened to me, my family, my friends. After that, I will never fly US Air again.

Don't tell me how you treasure my business over the phone. That doesn't mean anything. Actions show all. If they don't care about customer service, we know. We the customers are not stupid.

 

[Obi-Wan Pinobi]

Hmm, I never would have thought of an aisle seat as an "amenity." I can see a major problem with this suggestion. If a couple or a family wants to sit together, and to do so someone has an aisle seat (and there's no way around the aisle seat for even two people sitting together on a 767), that person is going to be charged more? That would just continue the complaints instead of resolving them.

I could see sitting in the first few rows of coach (such as ahead of the exit doors) as an extra-charge amenity. Having travelled on business a lot, I know business travellers like sitting toward the front so they can exit first. Or perhaps a preferred boarding charge that would let non-frequent-flier members board with the frequent flier program members.

 

[seashoreCM]

The problem the airlines are suddnely wakingup to is that more and more businesses are not flying their businessmen/women on their business trips using business class, the folks have to book economy class 'like they're flying for leisure.

Disney hints:
http://members.aol.com/ajaynejr/disney.htm

 

[Miss Jasmine]

Delta has hired someone to specifically look into becoming more value oriented, such as JetBlue and Southwest. It will be interesting to see what findings come from that new department. With that said, Delta has just slashed additional flights bringing down available seats that might push up ticket prices. More planes are off to desert storage.

I still say that we will see all of the major carriers go through reorganization within the next two years (excluding Southwest and not counting JetBlue because it is still serving a small market).

People, whether traveling for business or leisure, are not willing to spend what they used to on tickets. The airlines need to recognize it and they need to start cutting costs such as renegotiating contracts so they can offer lower fares. They need to bring the cost per mile down, that is imperative. Right now by just slashing flights and personnel, they are not bringing that number down.

 

[CarolA]

I do believe that the days of paying $100 to $200 a person for the reserved seat etc are nearing an end. Yes, you will be able to put your family together, but you will have to pay more. Complaints are not what the airlines are most concerned about right now, survival is. Lots of people don't like Southwest because they don't get reserved seating, but they want American or Delta to match those fares. I think that what will happen is that when the airlines give you those cheaper fares it will be without the perks like advance seat assignment. Right now they are getting complaints from those few passangers paying the big bucks that for $800 round trip to Charleston SC, we don't want to be in a middle seat in the back!

The bigger problem is airline costs. All of the airlines have unions and NONE of them want to cut their salarys, this could be a rough few years and if some of the airlines don't survive that starts to lessen the pressure on the remaining airlines.