Could the Govt. solve our industry's fuel woes?

[SoCalAprch]

Who knows. If you are the only one to raise ticket prices I think it will hurt you. If everyone does it I think it will be a good thing.

By the way which airlines are still profitable with the Oil costing what it does now?

[kellwolf]

Originally Posted by BobDDuck

Sure, the government could tack on a $30 fee, but that money would be going to the government (like taxes) and wouldn't help the airlines out at all.

They did that already. It was called the 9/11 security fee. If you look at the amount of taxes on an airline fare (departure fees, landing taxes, etc), you'll probably be amazed. The airline doesn't get 100% of what you pay. In fact, the gubment probably gets at LEAST a good 10-15%.

[tonyw]

A $30 increase from what?

From the $99 fare that there are only two of per flight?

From the $159 they also have?

From the $399 for last minute tickets?

From the $1,099 for the el cheapo first class?

We can either have a deregulated industry or we can have a regulated one. If we want the government to set fares, let's re-regulate the industry.

It'd be fine by me!

[caliginousface]

Yeah, the govt. could stop subsidizing oil.

[Maurus]

We could dig for oil in Alaska!

[Number1atNumber2]

Originally Posted by PCL_128

"Progress?" Is that what you call this? Many cities have lost airline service altogether. Still many others now receive RJs or Q400s where they used to receive 727s and 737s. Customer service has become nonexistent. This isn't progress. This is a slow slide into death for the industry. It's time to bring back regulation. The experiment failed. Time to admit it and go back to what works.

I'd also like to see the government stop bailing out the companies that plaay the bankruptcy games. They come up with business plans that aren't sustainable and then when reality catches up with them they go and cry and demand government bail them out for their screw ups.

[DZERO]

Airlines will start to nickel and dime the hell out of the consumer. Fine, your base fare is $150.00...BUT your second bag is now gonna be $25.00. Your over weight first bag is gonna cost you $80.00 because you tried to save $25.00 by stuffing more crap in your first bag. Oh, and you want to do curbside check in??? $3.00 please. You want something to eat on board??? That will cost you too. A friend of mine went to Europe and got a ticket for some ridiculous price like 10 Euros, but he got SLAMMED for the weight of his luggage. Each bag was about 50lbs each. No problem over here in the US but when he started flying around Europe they killed him with overweight charges by the POUND in some cases.

[SoCalAprch]

Originally Posted by DZERO

Airlines will start to nickel and dime the hell out of the consumer. Fine, your base fare is $150.00...BUT your second bag is now gonna be $25.00. Your over weight first bag is gonna cost you $80.00 because you tried to save $25.00 by stuffing more crap in your first bag. Oh, and you want to do curbside check in??? $3.00 please. You want something to eat on board??? That will cost you too. A friend of mine went to Europe and got a ticket for some ridiculous price like 10 Euros, but he got SLAMMED for the weight of his luggage. Each bag was about 50lbs each. No problem over here in the US but when he started flying around Europe they killed him with overweight charges by the POUND in some cases.

Was this European airline profitable? Ryan Air perhaps.

[Realms09]

What you are suggesting is government enforced collusion / oligopoly - which from my point of view is an unsavory proposition. This involves using coercion to seemingly improve your (an airline employee) position at the expense of someone else (non airline employee). This is probably a non-issue to you, the airline employee. However, the government does not represent just airline employees - it supposedly represents all of us proportionately. So why should government interfere in a market to improve the few at the expense of the many? How can government make such a value statement?

[PCL_128]

Regulation is not "collusion." It is a tool to stabilize an industry that has proved time and again that it can't stabilize itself under a normal free market system. In the entire 75+ years of commercial aviation, the entire combined profits and losses show a net loss of billions for this industry. In other words, commercial aviation has never turned a profit. The nature of the business makes it nearly impossible. Companies turn a profit of a few hundred million for a few years, and then they spend the next few years losing billions. Regulation benefits everyone, not just the employees, by stabilizing an industry that is vital to the US and world economies.

[blee256]

Originally Posted by DZERO

No problem over here in the US but when he started flying around Europe they killed him with overweight charges by the POUND in some cases.

Are you sure it wasnt by the kilo?

[RightSeatGirl]

Originally Posted by PCL_128

Regulation is not "collusion." It is a tool to stabilize an industry that has proved time and again that it can't stabilize itself under a normal free market system. In the entire 75+ years of commercial aviation, the entire combined profits and losses show a net loss of billions for this industry. In other words, commercial aviation has never turned a profit. The nature of the business makes it nearly impossible. Companies turn a profit of a few hundred million for a few years, and then they spend the next few years losing billions. Regulation benefits everyone, not just the employees, by stabilizing an industry that is vital to the US and world economies.

Well put and fo sho!

It may be a dreary prospect in some ways, but nothing else is being done to save the industry. With the very real possibility of an actual depression looming I'm all for doing something to increase stability industry wide. Now I realize if a depression actually happened (possible yet unlikely), the whole of the industry would be toast re-regulation or not. But with such dire predictions for the economy looming I am concerned about my job. So I started this thread to get everyone talking vs just thinking how screwed we all may soon be. This oil crunch is only going to get worse. We could be looking at unprecedented scale backs in manpower and equipment industry wide very very soon. And that won't mean furloughs either. More likely it will be permanent layoffs. This nations economy cannot and will not be sustainable with gasoline over $4 per gallon. It's already beginning to crumble with it $.50 cheaper then that. This latest Delta thing, that's nothing. Give it 18 more months. We could see a very near future where only the top 10% of the 121 workforce is still employed and probably at half of what they earn today.

Sorry to be such a negative nellie but I'm worried.

[Cav]

Originally Posted by PCL_128

Regulation is not "collusion." It is a tool to stabilize an industry that has proved time and again that it can't stabilize itself under a normal free market system. In the entire 75+ years of commercial aviation, the entire combined profits and losses show a net loss of billions for this industry. In other words, commercial aviation has never turned a profit. The nature of the business makes it nearly impossible. Companies turn a profit of a few hundred million for a few years, and then they spend the next few years losing billions. Regulation benefits everyone, not just the employees, by stabilizing an industry that is vital to the US and world economies.

I don't think the free market is the problem. The problem is that the current situation is not a true free market, it's still highly regulated. The government wants it both ways. Either regulate it or let the free market do its thing. If that means a carrier goes out of business then so be it. For me personally I don't trust the government to do anything well so I say let the free market run its course.

PCL_128, I'm curious as to how everyone benefitted from regulation? Flying today is less expensive than it was under regulation therefore making it available to more people. This has undoubtedly helped the economy. Sure I think fares should go up but they are doing just that and capacity is being cut. People need to quit looking for short term band aide fixes. The truth with any market is, the more the gov. messes with it the more screwed up it gets. It's just like the housing market. The idea that the government is going to step in and prevent a bunch of foreclosures is rediculous. If you can't pay the bank should be permitted to foreclose. The same could be said of the airlines. The market will take care of itself.

[PCL_128]

Originally Posted by Cav

PCL_128, I'm curious as to how everyone benefitted from regulation? Flying today is less expensive than it was under regulation therefore making it available to more people.

That's a myth, my friend. Alfred Kahn loves to spread that BS, since he and Carter are responsible for this entire mess, but the truth is much different. If you take average fares now and adjust for inflation back to 1978 (the year of deregulation), you'll find that fares haven't really changed that much. A few percent here or there on some leisure markets, but nothing significant. The consumer has not done better under this horrible "free-market" system.

The market will take care of itself.

I'm reminded of Dick "Bullseye" Cheney's famous comment that the "deficit is big enough to take care of itself." Time to accept reality that things really aren't going that great.

[Cav]

Originally Posted by PCL_128

That's a myth, my friend. Alfred Kahn loves to spread that BS, since he and Carter are responsible for this entire mess, but the truth is much different. If you take average fares now and adjust for inflation back to 1978 (the year of deregulation), you'll find that fares haven't really changed that much. A few percent here or there on some leisure markets, but nothing significant. The consumer has not done better under this horrible "free-market" system.
.

I'd be interested to see the numbers because I'm not buying it.

[Cav]

Originally Posted by PCL_128

I'm reminded of Dick "Bullseye" Cheney's famous comment that the "deficit is big enough to take care of itself." Time to accept reality that things really aren't going that great.

Different argument all together. The root of your comments stem from problems with government spending not regulation of the market place.

[PCL_128]

Originally Posted by Cav

Different argument all together. The root of your comments stem from problems with government spending not regulation of the market place.

No, it's all tied together. It's that entire mentality of "the free market fixes everything, laissez faire capitalist economics is wonderful, yada, yada, yada." Some government involvement is needed in any capitalist system. Capitalism run amok is a very scary proposition.

[surreal1221]

Must I bust out some Noam Chomsky and explain why the Free Market is a dream of Wall Street elites, and it will never be a "free market" economy no matter what country you are in, on, or from.

The free market is nothing more than a term used to push blame away from people's actions.

[PCL_128]

Ugh, please don't. I can't stand Noam Chomsky.

[surreal1221]

You're saved then.

[Baradium]

Originally Posted by Matt13C

People invest in oil futures as a hedge against inflation. Every time the fed cuts rates the chance of inflation rises. As the chance for inflation rises the demand for oil futures increases and this increases the price of a barrel of oil. Since oil is so high already it is essentially a self fulfilling prophecy. Oil companies margins decrease as the costs of the raw material increases. If it was a slight increase they might just ride it out and not pass it on, but a large increase requires a rising in the price of the goods sent to market, refined fuel. Since fuel is almost a need it sparks an increase in prices across numerous industries.

You realize that the "cost of the raw material" doesn't increase for the oil companies,right? They're the ones pumping it out of the ground... it's still the same cost for them, they just increase the pump price to reflect what the "market says we should charge ourselves." That's why the oil companies are making record profits... because they pay THEMSELVES for the oil.

The only reason oil prices go up is the speculators. The only reason pump prices go up is oil companies using it as a reason to charge more.