Mark (mhaithaca) wrote,
Mark
mhaithaca

False economy

The airlines are desperate to salvage their business model, which is being battered from all sides, and to be honest, I sympathize. People want to spend less and less to get around the country and the planet, and they expect more and more. Meantime, all of the airline's operating expenses have skyrocketed, not least of which the huge leap in fuel costs over the last few years. They're having to absorb extra costs to implement lunatic security measures, unions are driving pay upward faster than inflation, and inflation is making everything else pricier -- while consumers keep demanding low fares and keep screaming at every hike.

Yesterday's USA Today had a good piece on how British Airways has reinvented itself by focusing more and more on the higher revenue opportunities like first class and business class travelers, earning a reputation for excellent service that you can have if you're willing to pay for it. There's no margin in moving someone across the U.S. for $200, but the airlines that are successfully charging $700, $1,200, or $4,000 for a large percentage of their seats are the ones who'll survive. Much as I'd like to be able to keep enjoying inexpensive travel, I realize it's not realistic.

The problem is that the consumer airlines like US Airways haven't realized this, or are desperate to keep the business of the consumers who refuse to accept it. $150-300 vacation fares have always been subsidized by sales of much pricier tickets. It's not that it's not possible to make money with a plane full of seats sold at $200 each, just that it has to be done in such a no-frills way that people bitch that they're not getting their money's worth -- when that's exactly what they're getting.

The tweet from Dave Zatz mentioning that United has joined American in charging $15 for the first checked bag really makes me shake my head. This trend, following fast on the heels of the now almost ubiquitous charge for a second bag after a first bag gets aboard free, is just the latest desperate attempt by the airlines to avoid raising their fares to compensate for those skyrocketing fuel costs. (Another was the revelation that many planes are flying more slowly to conserve fuel, on the same theory that drove President Carter to push a 55 mile per hour national speed limit.)

Unfortunately, I think the result won't be a big stack of $15 fees for the airlines, but a lot more people bringing too-big bags on board the plane with them. This doesn't help cover the fuel cost, and doesn't reflect a charge based on whether you're bringing luggage. It just makes the cabin more cramped. If the charge were per pound of luggage whether you checked it or carried it on, it might help to reduce fuel costs by getting people to pack lighter. (Similarly, telling someone whose suitcase weighs 51 pounds they have to carry a pound of it by hand doesn't accomplish anything.)

Those passengers who do decide to check their bags, or who have no choice because they want to bring their shampoo or spray deodorant or toothpaste or pocket knives with them, will slow down the process as check-in agents are forced to handle lots of additional monetary transactions. Those who decide to carry their luggage aboard will slow down the process at the security checlpoint, as each bag has to be x-rayed, and more and more have to be searched by hand; at the gate, as roll-aboards that just won't fit in the overhead compartments have to be "gate checked;" and in the aisles of the plane as twice as many people try to cram twice as much into those incredible shrinking bins. (Yes, I'm sorry, I do mind placing my laptop bag on the space where my feet need to be, just because the other passengers refused to check their luggage.)

Sad though I am to admit it, I think the solution is for the airlines to start charging more realistic (read "higher") fares. Sure, provide some discounted seats for those who can book well in advance, as long as you do so in a predictable and reasonable way. And, provide sharp discounts for the last couple of days before a flight, since an unsold seat might as well bring in a few bucks rather than none. (Charging three times as much for a last-minute flight has always struck me as self-defeating.)

Charge me $300-500 for a trip, depending on where I'm going. That's still a reasonable price, especially considering inflation over the last decade. In fact, it'd probably be one of the lowest average airfares in history, adjusted for the value of the dollar. Stop the nickel-and-dime treatment for those who want to check a bag rather than racing around through airports with it, or for those who want to watch the in-flight movie. I'm torn on whether airlines should charge separately for food. I bet the businesses who've sprung up selling sandwiches to go in airports just love that the airlines are charging for food on board; might as well just charge for a meal for those who actually want it. I think that's less nickel-and-diming than some other aspects of air travel.

In a sense, I'm taking a difficult position for someone who lives in a tertiary air market. Ithaca's airline service is barely adequate as it is, and we don't have any of the no-frills options like JetBlue or Southwest available to us. Ithaca air travelers won't be able to choose between $150 and no-frills vs. $500 with all the bells and whistles. Worst of all, major airfare hikes out of Ithaca might kill some or even all of the existing service. I don't want that. But I don't think the current situation is sustainable, and if the service is going to die, it might as well be for the right reasons rather than the wrong ones.
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