Next to Fall?

[DenverPilot8]

For God Sake raise the ticket price! Charge at least what it cost you to provide it. Why is this even an issue? Is Southwest Airlines going to meet the national travel demand by themselves?

[E6BAV8R]

Originally Posted by SmitteyB

That would work, if you didn't have competition from shady carriers like Southwest.

Re-regulation time!! .. sorta

[bike21]

SWA? The original under-cutter and current PFJ 'major'. Ha!

They can do no wrong!


edit to add: Don't want to sound too harsh, but SWA gets off too lightly. While they do enjoy good labor relations, they have hurt the industry as a whole. Like'em or not.

[Doug Taylor]

Originally Posted by MichaelCPS

How about the airlines start raising the prices of their tickets?

Exactly.

The price of lettuce is way up, but "OMG! If they increase the cost of airline tickets because of a higher CGS, no one will fly! OMG! OMG!"

[surreal1221]

Watch out guys. . .we have a defender of pricers in our group.

He might come to their rescue.

[SpiraMirabilis]

Originally Posted by surreal1221

Watch out guys. . .we have a defender of pricers in our group.

He might come to their rescue.

There is something to be said about low prices in order to break into a market (in this case maybe a route because we're talking about airlines) but it seems like the industry forgets to raise the prices after becoming established, so they're like trying to make up losing money by selling in volume?

[skydog]

Originally Posted by SeanD

Perhaps if someone opened up the oil reserves. Im still not sure why this hasnt happened yet. I think if there is a time to utilize them, that time is now.

I assume you mean the Strategic Petroleum Reserve. That's not what it is there for. The SPR exists to provide a source of crude oil in case the supply flow is interupted. For example, when Katrina damage shut down most of the crude oil production in this country, the SPR was tapped to provide relief. I assume it is also there in case of military need, hence the "strategic" name. Now it could be that the reason the price of oil is so high is because GWB wants to increase the amount on reserve, but that is a different story.

[WAFlyBoy]

Amazing. One article that quotes one airline analyst, and all of the sudden this is a huge issue (again). Last week the big buzz was the industry "is going to be fine." And now we're talking about everything from tapping into the SPR (not what it's there for, and this wouldn't change the price of oil much, if at all) to bio-fuel powered jets (anybody get Time magazine? Great argument against biofuels in a recent edition).

Airline analysts are like analysts for any other industry: there are bears and bulls. When it comes to selling magazines and airtime, the bears almost always get the brunt of media attention. Not to say that we've seen the last of airline bankruptcies for a while.... but I think this article is a little over the top in dramatic effect.

[brent p h]

<p>

Originally Posted by Maximillian_Jenius

<a href="http://biz.yahoo.com/ap/080406/iran_opec.html" target="_blank">http://biz.yahoo.com/ap/080406/iran_opec.html</a></p>
<p>&nbsp;</p>
<p><font size="4"><b>AP</b></font></p>
<p>&nbsp;</p>
<p>Iran to OPEC: Stop Oil Sales in Dollars</p>
<p>Sunday April 6, 3:34 pm ET </p>
<p>&nbsp;</p>
<p>Iranian President Urges OPEC to Form Joint Bank, Stop Pricing Oil Trades in US Dollars </p>
<p>&nbsp;</p>
<p>&nbsp;</p>
<p>TEHRAN, Iran (AP) -- Iranian President Mahmoud Ahmadinejad is urging OPEC members to form a joint bank and stop pricing oil trades in U.S. dollars. </p>
<p>&nbsp;</p>
<p>According to the Iranian government's Web site, Ahmadinejad told OPEC Secretary General Abdalla Salem el-Badri the cartel &quot;should establish a joint bank as well as having joint currency.&quot; </p>
<p>&nbsp;</p>
<p>Oil is priced in U.S. dollars on the world market, and the currency's depreciation has concerned producers because it has contributed to rising crude prices and eroded the value of their dollar reserves. </p>
<p>&nbsp;</p>
<p>Iran has repeatedly urged OPEC members to shift sales away from dollar. But Iran's proposal to trade oil in a basket of currencies is not supported by enough OPEC members, which include staunch U.S. allies such as leading producer Saudi Arabia.

</p>
<p>&nbsp;</p>
Hate to say It guys... But when this happens (and it will) standby because oil prices aren't the only thing we will have to worry about

[SmitteyB]

Originally Posted by bike21

SWA? The original under-cutter and current PFJ 'major'. Ha!

They can do no wrong!


edit to add: Don't want to sound too harsh, but SWA gets off too lightly. While they do enjoy good labor relations, they have hurt the industry as a whole. Like'em or not.

I completely AGREE. Couldn't have been said better.

And this shady MX. They should be ASHAMED of themselves and typically the FAA just says "BAD SWA, pay us pennies!"

$10.2 million. What a joke! We should have been talking MAJOR fines or reduction in operations. Enough to make a dent and make an example out of them.

Think about the additional revenue they made by keeping those 73's in service, it was well in excess of $10.2 million.

FAA continues to drop the ball. Sorry but SWA is proof they're scum.

[MirageCM]

And the other thing I hate...not getting a pack of peanuts or crackers during the flight. Now they charge like 5 dollars for them. What's next...soda?

[SmitteyB]

The Strategic Petro Reserve will never be used on commercial airplanes. This exists to keep the country running in case of an interruption in oil production. Cars so most Americans can get to work, is what I believe it will be used for.

It should NOT be used on airliners.

[mikecweb]

Originally Posted by surreal1221

Watch out guys. . .we have a defender of pricers in our group.

He might come to their rescue.

Please expand on this, I'm intrigued.

[unclenobby]

Originally Posted by mojo6911

I don't understand why the airlines shoot themselves in the foot and undercut eat other to the point that they all lose money.

I guess the execs figure the gubment will bail them out again when they tank.

That's called competition. If there is some sort of collusion on prices between competitors then it's illegal and anti competitive (see Virgin and BA recently). On the flip side if there were a case of predatory pricing to drive competitors out of business that's also illegal.
I think ultimately the market will find it's natural state appropriate to the economic reality of the time -

[ComplexHiAv8r]

Originally Posted by MichaelCPS

How about the airlines start raising the prices of their tickets?

Originally Posted by DenverPilot8

For God Sake raise the ticket price!

There you guys go thinking rationally again. STOP THAT!

[Fly4Pay]

From http://www.forbes.com/feeds/ap/2008/...ap4852418.html

ORLANDO, Fla. - Airline AirTran Airways, a subsidiary of AirTran Holdings Inc., said Thursday its traffic grew by 16 percent in March.
The company said it reported a record 1.7 billion revenue passenger miles on a 13 percent rise in capacity during the month.

From http://peanuts.aero/low_cost_airline...bruary+traffic

AirTran Airways reported all time record traffic for the month of Feb-08. AirTran Airways reported that revenue passenger miles (RPMs), available seat miles (ASMs), enplaned passengers, and load factor represent new all-time company records for the month of February.

For Feb-08, traffic grew by 28.2% to more than 1.4 billion RPMs based on a 14.0% increase in capacity. The carrier’s load factor for Feb-08 was 78.1%. The carrier enplaned more than 1.8 million passengers for the month, a 21.9% increase from Feb-07.

From http://www.reuters.com/article/press...08+PRN20080204

ORLANDO, Fla., Feb. 4 /PRNewswire-FirstCall/ -- AirTran Airways, a
subsidiary of AirTran Holdings, Inc. (NYSE: AAI), today reported record
traffic for the month of January 2008. The airline reported that revenue
passenger miles (RPMs), available seat miles (ASMs), enplaned passengers, and
load factor represent new all-time company records for the month of January.
For January, traffic grew by 14.4 percent to more than 1.2 billion RPMs
based on a 5.5 percent increase in capacity. The company's load factor for the
month was 67.4 percent, up 5.2 points from January 2007. The airline enplaned
more than 1.6 million passengers for the month, a 9.1 percent increase from
January 2007.

I don't think we're going anywhere anytime soon.

[Wolfy]

I'm shocked they'll operate at a loss, hoping that oil prices will turn around. Gold mines do the same thing. It's cheaper to continue mining at a loss than shut down and restart. The difference is that gold is slave to a speculative market, airlines set their own prices.

I see it like two bus drivers (CEOs) playing chicken to the end of a cliff. Neither of them are going to back down first (raise prices) and they'll both end up driving off the cliff. The sick part is they don't mind because they have parachutes (bankruptcy laws) and don't care about the passengers in the back (employees).

[Old Pete]

Originally Posted by Wolfy

The difference is that gold is slave to a speculative market, airlines set their own prices.

This is where I disagree with you, airlines are subject to the same market forces that gold or any other commodity is subject to. If airlines could set their own prices, and fill the seats, they (the ticket prices) wouldn't be where they are now.

[WestIndian425]

Something that I'd like to echo that really surprised me. Oil is up at an all-time high, but only relative to the US dollar. It's pretty consistent with the Euro. Thus, although I believe the cartel does have some responsibility, the bulk of the responsibility lies with the falling value of the US dollar (and changing the colors from green to these "psycadellic" colors is not going to help either )

As for the original question, I'm not sure who'd be next to fall. Ideally, I hope that no one else falls (even the companies that I'm not particularly fond of). Each instance causes the unemployment rate to rise dramatically, another sad indication of our economy.

[dakovich]

Originally Posted by surreal1221

Problem is our dollar is an absolute joke. Get us back ON the gold standard.

Just take a look at the match-up with the price of gold, and the price of any other raw good that is traded. Our dollar is merely weakening at the same trend.

"Bernanke cited reasearch showing that the longer countries remained on the gold standard during the 1930's the deeper their economic depressions"

good article form BusinessWeek (march 10). talks about the great depression, and the relationship between interest rates and inflation.

[kellwolf]

Originally Posted by MichaelCPS

I really don't think it would hit people as bad as you think. Look at all of those $80 one way fares. Do you think people would balk if it was $105? Let's look at the economics of it on the airline side.

How many $80 one way fares are there? I bet you'd be surprised when you look. I agree that raising ticket prices will help, but some people tend to think it'll solve the problem. It won't. Odds are airlines have already reduced the number of those cheaper fares per leg, and you would have been hard pressed to find a one way fare that low anyway. Most were for a round trip ticket for each leg requiring a Saturday night stay and at LEAST a two week in advance purchase, possibly further out. If you had 10 of those one a flight, I'm willing to be it's down to 6-8 by now. It's a little more complex than "just raise fares $25 across the board." I'd be willing to bet that if they reduced the number of discount seats per flight and upped the number of full fare seats, they'd see a better return than just an across the board fare hike. It's also sneakier and less vulnerable to "American raises their fares, United raises their fares.....DOH! NWA stayed the same."

[surreal1221]

Originally Posted by mikecweb

Please expand on this, I'm intrigued.

A certain member with the initials of Charlie Foxtrot comes to the defense of pricers across the world whenever anyone mentions raising fares.

If you're still intrigued, a simple search of the phrase pricers and Charlie_Foxtrot will yield what you seek.

Originally Posted by dakovich

"Bernanke cited reasearch showing that the longer countries remained on the gold standard during the 1930's the deeper their economic depressions"

good article form BusinessWeek (march 10). talks about the great depression, and the relationship between interest rates and inflation.

I can't tell if you're just quoting me, or if you're providing a response and are seeking a reply?

[Gonzo]

Originally Posted by SmitteyB

I completely AGREE. Couldn't have been said better.

And this shady MX. They should be ASHAMED of themselves and typically the FAA just says "BAD SWA, pay us pennies!"

$10.2 million. What a joke! We should have been talking MAJOR fines or reduction in operations. Enough to make a dent and make an example out of them.

Think about the additional revenue they made by keeping those 73's in service, it was well in excess of $10.2 million.

FAA continues to drop the ball. Sorry but SWA is proof they're scum.

I hate to be the one to tell you but all most all the airlines have been caught at one time trying to save money and cutting MX. Most of the fines where less then $10.2 million

[ASpilot2be]

I say LAB is probably the next to go

[Velocipede]

Lookin' At Bears? No way. The "silvers" start running in a couple weeks (Blue Haired Cruisers, for all you Cheechakos!).