acl65pilot

It's rather sad actually, when AmTrak charges more than an airline ticket these days.

Yes, but it is true that AmTrak has a monopoly. It can charge what it wants to for that market. It has its defined group of customers, and they know that they will pay what they have to NOT to fly.

skywatch

Hey, here is a crazy idea...assuming most airlines are already full or close (85% load factors for everyone)...what would happen if American or the like decided to QUADRUPLE their airfares? Surely people would try to book away or find another means of transport, but no many business folk are willing to drive from NY to LA, and there is only so much room on the rest of the carriers to pick up the slack (they are, for the most part, full as we have observed)...a certain number of passengers would HAVE to fly AA if they wanted to get to their destinations, right...so, instead of carrying 4 people paying $100 a ticket, maybe they are carrying one person paying $400 a ticket...he might not be happy, but tough luck. And what if DL and CO and the other carriers saw this, and decided hey, we can raise our fares too...because just like they said with gasoline prices (no one will drive when gas is $3 a gallon, right? WRONG.), maybe there is some room to raise airfares because people have to fly...period.

OK, now take turns as you shred this theory of mine please.

fosters

History has shown that the other airlines will undercut the airline that raised fares to attempt to drive them out of business. There is a huge precedent.

satchip

Realize that there is a certain price point that the consumer will just not fly. They will choose some other means of transport or just not travel to that destination. The business traveler that would and could afford to pay those higher fares are moving to corporate/fractional ownership and technology to replace traditional airline travel. Add to that the above statement and you see the problems faced by the marketing wiz kids.

The supply demand curve for air travel has changed from one of inelastic demand to one very much elastic at least domestically.

Sike

There is only one simple solution to all of our problems: reduce the competition in the market.

Not too many years ago, airlines primarily made their money off of business travelers... not the traveling public/vacationers etc. If carriers disappear and the level of competition diminishes, I would hope the same principle would support the industry. However, due to the structure of our government, including Chapter 11 protection, I am not sure it will ever happen and the downward spiral may well continue.

Consolidation is healthy for the long term future of the industry, but will make for miserable lives for many junior pilots in the short run. The only hope is that the pilot shortage on hand will play into our hands the way we all hope it will.

pilotss

I wish airlines could triple prices...but,

Travel back to the days when everyone wore suits to travel and the golden age of aviation existed. People did pay triple in price for those tickets with government subsidies included.

Now with low fares everyone with a trailer flies. That can be good if you look at all the jobs it created but the margins are much less and the subsidies are no longer rolling in to the bank.

Could airlines raise prices? Absolutely, but there would be a lot less pilot jobs out there.

Xray678

I agree with you. Done correctly consolidation would probably be a positive. But, a merger among the legacies will not fix the problems faced by the industry, namely overcapacity and the inability to control capacity.

During the early 2000s the legacies were all cutting back on capacity. The LCCs were adding it as fast as they could. A round of mergers ending up with only 3-4 legacies would be a very short term fix. Whatever capacity is taken out will be put right back in by the LCCs.

Probably the only consolidation scenario which works would be if each legacy carrier merged with an LCC in order to really be able to take some capacity out of the system and better control future capacity growth.

pilotss

Hi Xray,

That will be interesting to see if that cycle repeats itself. With projected decline in domestic market the legacy carriers are already shifting to international expansion and some are contracting domestically. Will they pick up that slack again or will there be enough to warrant adding the extra routes that the legacies may have cut?

The next few years may be tough for the LCCs. And how do you guys think the regional will fare. Contracts that are due when domestic markets are tight may not be very pilot friendly.

I guess there is always Kingfisher.

Xray678

It will be interesting. So far though, the LCCs seem to be acting with a little more restraint toward adding capacity.

The regionals, wow, tough call. I would normally say that the number of regional jobs will decline. The 50 seater is a dinasuar that can't make money with fuel prices this high, and I suspect the 70 seater is not a whole lot better. That said, I think there will be tremendous pressure on the legacy pilots to once again cave on scope, and you could see the regionals staying about the same in terms of number of airframes, only the airframes are bigger.


If the legacy pilots stand firm on scope, the RJ era is drawing to a close. But we face an even bigger danger now in letting the cat out of the bag with outsourcing of mainline size flying. That will be the other interesting thing to watch in the coming years.

pilotss

Think the turbo-props will ever surface again?