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Oil price at 4 year low but still V high fuel surcharges

Oil price at 4 year low but still V high fuel surcharges

Old Nov 28, 2014, 6:56 am
  #106  
 
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Originally Posted by MarioRossi
Reliable sources tell me the YQ will be reduced on February, 29th 2015!
In other words, never has next year is not a leap year

H
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Old Nov 28, 2014, 7:09 am
  #107  
 
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Originally Posted by nux
You see the amount in full before purchase. There is not really a published table of prices including taxes/fees/charges for revenue tickets either. Base fares are published, but the total price is not shown until purchase.

Although, there is a table for maximum redemption costs here: http://www.britishairways.com/travel...z/public/en_us
Slightly O/T, but that page suggests very pricey zone 3 redemptions



$525,207 seems rather a lot, doesn't it?

Last edited by Arbeiter2; Nov 28, 2014 at 7:17 am
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Old Nov 28, 2014, 7:16 am
  #108  
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Originally Posted by paulwuk
Invisible hand of the market of course! Capitalism FTW!
Yes but capitalism only works if monopolies are stamped on. BA is a monopoly which is how it gets away with this behaviour.
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Old Nov 28, 2014, 7:21 am
  #109  
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Originally Posted by lhrsfo
Yes but capitalism only works if monopolies are stamped on. BA is a monopoly which is how it gets away with this behaviour.
??? On what routes is BA presently a monopoly?
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Old Nov 28, 2014, 7:22 am
  #110  
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Originally Posted by lhrsfo
BA is a monopoly which is how it gets away with this behaviour.
When exactly did BA become a monopoly? The last time I looked, there were alternative choices for pretty much every route.
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Old Nov 28, 2014, 7:23 am
  #111  
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Originally Posted by Globaliser
When exactly did BA become a monopoly? The last time I looked, there were alternative choices for pretty much every route.
Just remembered, LHR-LBA! The behaviour on this route is disgraceful, there isn't even priority boarding on the southbound leg!
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Old Nov 28, 2014, 8:06 am
  #112  
 
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You do have to wonder where the fuel surcharge (YQ) money has gone over the last few years? As a shareholder I've received absolutely zero of it in the form of dividends.
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Old Nov 28, 2014, 8:18 am
  #113  
 
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Originally Posted by oyster
You do have to wonder where the fuel surcharge (YQ) money has gone over the last few years?
To fund all the investment in product enhancements, of course, particularly CE...

Last edited by shorthauldad; Nov 28, 2014 at 8:23 am
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Old Nov 28, 2014, 9:56 am
  #114  
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Originally Posted by oyster
You do have to wonder where the fuel surcharge (YQ) money has gone over the last few years?
It is simply part of top line revenue. It's always been like this, even when there was a closer link (numerically and logically) to fuel prices, just like the cost of fuel has always been in its place in the expenditure list.
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Old Nov 28, 2014, 11:36 am
  #115  
 
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One could argue that as there is no other direct flight out of PHX that BA has a monopoly. But in general I would not argee that BA has a monopoly, anywhere.

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Old Nov 28, 2014, 3:27 pm
  #116  
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Originally Posted by Hoch
One could argue that as there is no other direct flight out of PHX that BA has a monopoly.
But even routes like that, airlines offering connecting itineraries can provide very effective competition. Witness, for example, any destination that can be reached with a stop in Dubai.
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Old Nov 28, 2014, 11:32 pm
  #117  
 
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Originally Posted by Globaliser
But even routes like that, airlines offering connecting itineraries can provide very effective competition. Witness, for example, any destination that can be reached with a stop in Dubai.
If the geography was swapped round, and BA were based in the Gulf with their legacy structures and costs, in a state with high wages, and EK/EY/QR were based on a(n) island(s) in the North Sea, with low taxes/fuel costs/wages and so on, it would be interesting to have a discussion about "effective competition".

The TATL market might look a little different too.
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Old Nov 29, 2014, 12:24 am
  #118  
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Originally Posted by bull
When will it happen?
The crude oil has dropped, Jet a1 as well.
When can we expect the reduction of the fuel surcharge?!?!
Even if YQ was actually related to the price of crude, we'd have no way of knowing which way BA hedged their fuel contracts. They might well have guessed wrong.
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Old Nov 29, 2014, 6:46 am
  #119  
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Originally Posted by Maluku_Flyer
Even if YQ was actually related to the price of crude, we'd have no way of knowing which way BA hedged their fuel contracts. They might well have guessed wrong.
Originally Posted by Enrique Dupuy, IAG CFO
So our plan, especially as you will see our medium long term plan is is being based on price of fuel which is $950 per metric ton of kerosene and at $1.35 -- and this is the cost we have been working with these references for the last six months on our plan.
...
We have 65% of cover on our fuel bill, hedging cover on our fuel bill for the year 2015. So we'll be getting gradually the benefits of lower fuel and even with the combination of lower fuel and stronger dollar which appears to be the name of the game. So first half part, especially the second half.
And

Originally Posted by Audience question
Are you perhaps keeping something back to -- to give a bit back to customers because of the low fuel environment? Are there any sort of higher OpEx you might push through in a lower fuel environment that I actually perhaps should be thinking about? Thanks.
Originally Posted by Willie Walsh, IAG CEO
I'll let Alex speak directly to the issues but let me address the fuel. You know, what we're saying is that if we look at the fuel price then up until the 9th of September, Brent was trading above $100. At the end of September, Brent was still over $97. It traded between the 9th and the 29th of September between $97 and $99. It's only since then -- so October and , you know, early November, so a period of about five weeks that we've seen the price fall below $100. So I'll just say, at this stage, what we're thinking of is let's keep an eye on this because clearly, if it goes back to, you know, where we've seen on September, well then the business plan is probably the relevant figure to look at. There is some currency effect which I think is more, you know, stable, if you like, at this stage and negative for us. But that's what we showed in the chart that Enrique presented that, you know, if -- if fuel continues at the price, well then, clearly, there is some potential opportunity in that.
The reason we're not presenting that as a guarantee today, you know, you heard me earlier talked about confidence. I'm just not as confident around what the fuel price is going to do at this point. So we want to watch that over the next weeks and months. And certainly, when it comes to presenting our full-year '14 results which will be in I think early February and we'll -- we'll give you a more informed view on the impact of fuel price on our 2015. But we felt it was just a bit too volatile in the short term to sort of pin our -- the 2015 targets on an oil price that may well change. I think the view we take is that if you look at the fundamentals, you could argue, it shouldn't be at $82, it should -- you know, there's nothing really radical to this change.
But then, you know, you can make any arguments you like around the oil price and I'm no expert at it. I think I've told you this story before, the best presentation I ever got on fuel hedging was when I was at Aer Lingus and it was a fantastic presentation by a guy who went into all the micro and macro issues and I listened to this. And for the first time, I said "I now understand this, I get this, and I think it's very clear to me we definitely shouldn't hedge. We should take the advantage of the spot."
And he said, "Oh, no, no." He said, "No. Most definitely not. My recommendation to you is that you should hedge." And I said, "Why, everything you told me tells me we shouldn't." And he said "yes, I might be wrong."
So we'll just watch it for a little while and as I said, we'll update you. But we're not trying to hide this. You know, we're saying it clearly is, there is
just an opportunity and it's something that we'll update you on.
http://www.iagshares.com/phoenix.zht...-presentations
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Old Dec 2, 2014, 8:48 pm
  #120  
 
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YQ Surcharges are surely bound to decrease? Right?

Oil came down ~40% from its peak. Do you think airlines will decrease scam YQ surcharges? What can we do as consumers to force them to do that? Should we appeal to DOT, etc?

Discuss
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