07 November 2008

Airline Fees - Are Passengers voting with their wallets?

This was a question posed by Travel Daily News. The sad answer is they are not. Using the well established ALL - Airline Lemming Law (which proscribes that as long as anti-trust is not involved all airlines follow each other's behavior - usually over the cliff) - airlines have followed each other into the Ancillary Revenue sea. And they seem to be very happy with this. Why?

The program meets several airline objectives and criteria:

1. It generates revenue
2. It obfuscates the true price of an airline ticket
3. The LCCs have been doing it successfully and therefore it must be right
4. Everyone else is doing it
5. The passengers are not complaining (well not too much anyway)

The last major to adopt the first bag fee was Delta which aligned its policies with its now wholly owned sub Northwest.

This leaves only Southwest among the US airlines who is not subscribing to the model.

It remains to be seen whether Southwest will adopt this - however I dont think they will be able to hold out for much longer given the enormous sums of money that the US Legacy carriers are saying they are making from the Unbundled a la carte based pricing.

Of course there is that teensy weenie little problem of the tax - but who's are arguing today?


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