19 February 2008

British Airways and Virgin pay the price of Price Fixing

Lest anyone think that price fixing and signalling in the airlines is a closed shop affair - BA and VS will both have to fork out $200,000,000 to ticket holders of Long Haul seats from Aug. 11, 2004, through March 23, 2006. And yes folks I sat on quite a few of those seats. During that time BA flew a total of 50 million passengers short and long haul but the fuel surcharge only affects "long haul" seats whose passengers will get up to 10 pounds. Virgin flew about 7.5 million passengers during that time of which 100% was long haul. Virgin passengers get the same amount and of the fund BA pays 2/3rds the balance is Virgin.

This makes an interesting formula as it implies that Virgin is now 1/2 the size of BA long haul.

This is a sorry story as it resulted in casualties on all sides. There are no heroes in this story except perhaps the honesty of Virgin to come clean about the affair and spill the beans. I would be there are either other airlines quaking in their boots about this or others thanking their lucky stars they didn't get caught.

Strangely enough the alliances are one of the best places for refuge. You have to be SO careful not to talk about collusion that in any major discussion on the topic they have a lawyer present!

So anyway - I will be filling out my forms and claiming back my money.

When it comes up this is supposed to be the website to file:


It is showing under construction or a 400 error at the moment.


No comments: