Airlines to lift fees due oil price

The CEO of American Airlines is forecasting increased ticket fees should oil prices continue remain high. Other companies announced the same move. Airlines are locking in fuel hedges, lowering capacity, raising fares and retiring older jets to cope with rising costs alongside the highest oil prices since 2014

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there goes leg space

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The International Air Transport Association forecast airlines’ combined profits would be 12 percent lower than it had expected in December, at $33.8 billion in total, in large part because of costlier fuel. 

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2 minutes ago, Stephen said:

The International Air Transport Association forecast airlines’ combined profits would be 12 percent lower than it had expected in December, at $33.8 billion in total, in large part because of costlier fuel. 

 profits of $33.8 billion, down from a previous forecast of $38.4 billion in December? Poor bastards. Maybe they can ask to be subsidized 

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White House will recommend to carpool on planes

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16 minutes ago, Ja’Nako Bezze said:

The CEO of American Airlines is forecasting increased ticket fees should oil prices continue remain high. Other companies announced the same move. Airlines are locking in fuel hedges, lowering capacity, raising fares and retiring older jets to cope with rising costs alongside the highest oil prices since 2014

Rising air travel costs have been going on a long time. Air travel has been a pain in the walletr for quite awhile.

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Oil was $72.04 a barrel 10 days ago and Friday it was $65.71 and the price of gas still went up in my area two days ago.

They are still banking on trump doing something really stupid 

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Remember when prices came down because oil prices did? Neither do I.

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If I am going to spend $1,200 on a round trip ticket do you really think if they raise the price to $1,250 or $1,300 I'm going to cancel it? Of course not. They know it. They don't need actions from us but from regulators

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When was the last time fees got cheaper when oil prices came down.

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53 minutes ago, Ja’Nako Bezze said:

The CEO of American Airlines is forecasting increased ticket fees should oil prices continue remain high. Other companies announced the same move. Airlines are locking in fuel hedges, lowering capacity, raising fares and retiring older jets to cope with rising costs alongside the highest oil prices since 2014

One would think these billion dollar companies would give US a break after the windfall they made from the recent Tax bill.

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3 minutes ago, JohnAtronis said:

When was the last time fees got cheaper when oil prices came down.

many airlines hedge their fuel contracts so it is hard to know exactly what they are paying unless they tell you how they have set up the hedges.

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40 minutes ago, Cokiga Damke said:

many airlines hedge their fuel contracts so it is hard to know exactly what they are paying unless they tell you how they have set up the hedges.

Airlines are quick to raise prices when oil prices rise, even with hedging, and they are slow to lower ticket prices when oil prices fall. The best of both worlds, I guess...

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58 minutes ago, Ja’Nako Bezze said:

If I am going to spend $1,200 on a round trip ticket do you really think if they raise the price to $1,250 or $1,300 I'm going to cancel it? Of course not. They know it. They don't need actions from us but from regulators

Oh, please--no more regulations.I've had my just fill of regulations. Let the market work; it will as long as the government stops meddling. 

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4 hours ago, Rodent said:

Oh, please--no more regulations.I've had my just fill of regulations. Let the market work; it will as long as the government stops meddling. 

Probably not.  Four US carriers control 90% of the domestic market.  What you end up with is one leader doing price signalling, the others following lock-step.  There is no price competition because there is no excess capacity to sell. That is why you get such bad corporate behavior from carriers and also why the public just puts up with it.  A doctor gets beaten up and dragged off a plane by Big Guys in Uniforms; what do the other passengers do?  Do they walk off?  Nope. They have no alternative but to keep their booked seats. Get off and you can try the Greyhound bus, there's your substitute.  Just lovely.

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Hate to say it guys, but it's a free market and the airlines have no obligation to offer cheap tickets and are free to charge whatever the market will bear. Sometimes that will result in fat profits, other times what the market will bear will still lead to losses. Competition keeps a lid on prices, and history has shown that inefficient operators will go out of business.

 

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Refman has a point here - next to that, airlines are already a low margin industry, struggling with high capital expenses and labor expenses... so making flying a bit more expensive might not be a bad idea.

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