ketchikandie

alaska airlines seems to have very reasonable to downright cheap flights between cities in the continental us.

but why, oh why, are we allowing them to steal our money when we alaskans are trying to leave or enter the states????? i'm inclined to think that ALASKA airlines are geared towards ALASKANS.

heaven forbid you pay less than 400 dollars for a return ticket between seattle and the closest city in alaska ( flight time of one hour and 30 minutes). i just came back from my travel agent and she offerd me 600 out of seattle to aberdeen, scotland!

this is down and out daylight robbery if you ask me, considering our only other option out of town is with the alaska marine highway system, a trip of 31 hours.

is there a answer that could possibly give me a reasonable explanation....or will it remain a mystery forerver....

Sćculorum

Capitalism. That is all.

Sćculorum

Tell me again how that is not capitalism.

ketchikandie

ah hah....i thought of that..but i still believe they are extortionists..they very easily relax fares when competition enter town...usually far below what the new carrier is asking..and what do you know, few months later new carrier is no more.

then we get punished with fares that is twice as high. this is just does not sound like fair competition.
but i'm just a dumb alaskan, what do i know.

MMA95D

Probably the lack of competive fares is most directly related to Mark Air going under during the mid 1990's. The AS cabin service also started it's steady downward spiral about that time as well to what we have today.

AS Flyer

And when was the last time there was a new carrier in Ketchikan??? Delta left how long ago? They were hardly a new carrier. Wien just went out of business after years and years of serving the state of Alaska. Markair went out of business thanks to a horrendous business plan. So when did anyone ever try to start flying to KTN or JNU or SIT and get run out by Alaska? Name one airline please. You most likely can't. Why? Because no other airline is willing to commit aircraft to a market that carries extremely light loads for over 1/2 the year. Nor do they wish to commit their resources to a market that is known for inclement weather for long periods.

I think that that the residents of Alaska deserve quality air service but there's a reason that Alaska Airlines is the only airline to fly to many cities in Alaska. Other airlines are free to come on up and give it their best shot. Some airlines like Jet Blue and Southwest specialize in bringing low fares to communities that don't offer any low fare service. I don't think either of those carriers probably have KTN or JNU or SIT on their radar anytime in the forseeable future. Fares are high because the cost of doing business there is high - plain and simple.

eastwest

I am inclined to agree. It's not like AS is making money hand over fist anywhere. They turned a modest profit (mostly due to fuel hedging) and may show a profit for the year. If they do...it won't be because they gouged everyone in KTN to do it...<LOL>


Anyway...welcome to Flyertalk. You live in a lovely place and hopefully you can help some folks out with KTN related questions...and get some help with your questions as well...

AinA

It is called predatory pricing. AS was guilty of it to the extreme when it came to Mark Air but Neil Berg [or whatever his name was] had really bad business management skills, so everyone uses that excuse.

The issue for Alaskans w/ Seattle Airlines.. oh wait, did I say that? I meant the issue for Alaskans with Alaska Airlines is that there is no competition here. AS partners with what little podunk airline might possibly become a potential threat down the road (read Era Aviation) and if anyone comes into town, AS drops their price well below the cost to drive out the competition. Look at AS' prices on the flight times that coincide with the times that UA flies ANC/SEA. While I realize that is not a prime example of how savvy they are at predatory pricing, look at AS' history when Mark Air was in town for a really great example.

BUT! I must point out that this is all okay because they do serve Alaska Amber now. So as much as it might seem like I am complaining I am not, this is just an observation.

Alison

johnp012001

Well, I looked at 12/7-12/13, We-Tues, normally cheap travel days.

SEA-ANC

UA $299
AS $358

SEA-EWR

UA $362
AS $291

SEA-LAX

UA $223
AS $243

For SEA-ANC there weren't any time restrictions, it was available on all flights. Now, I'll be the first to admit this is no scientific study, but I would have to concur, this is NOT a prime example of how savvy they are at predatory pricing! Given the LCC competition, it's not surprising that EWR and LAX are cheaper than ANC. Interesting, UA is matching Southwest on SEA-LAX, but AS is pricing $20 higher, apparently believing that their non-stop is worth an extra $20 (rightly so!).

SEA_Tigger

All of the majors/entrenched carriers practice "predatory pricing". It's how they kept the LCCs at bay for so many years (WN is close to 25 years old, afterall). Flood a market with a new entrant with cheap seats to drive them out, then raise fares again when they're gone.

All that being said, AK is not a cheap market to support, as AS Flyer noted, and chances are even if MarkAir knew what they were doing and they and AS "played nice" with each other, MarkAir would eventually have folded because of the seasonal loads and weather-related scheduling and operational issues. AS has expanded beyond just AK so they can spread their costs and revenues out more, which actually improves their ability to support "marginal" AK markets, even if those markets have high fares. If AS had to fly just those markets, fares would probably be even more.

AinA

I flew weekly between ANC/SEA this summer, last summer, the summer before that and this is the market I referred to. If I wanted to fly on the lowest cost flights that AS offered, those were the ones that coincided with the times that UA flew the same route, typically a 1 am-ish flight and a mid day flight. The OTHER 20-ish flights a day that AS flew were a good 40% higher. And I was flying mid-week. This was just actually good old competitive pricing, this is not predatory pricing in its true sense.

What AS is doing now with their new pricing structure I couldn't tell you as I am not following the fares like I do in the summer. The OP's issue is that a person can get a ticket to fly triple the miles in the Lower 48 that Alaskans pay twice as much for intra-state or just to get from one of the outlying markets (read markets without competition) to SEA.

IMHO, Mark Air WOULD still be around if it weren't for AS' ILLEGAL actions with predatory pricing. Yes Mark Air had issues that are all claimed to be a bad business plan, I am going to be very careful about how I say this, Mark Air's issue was Mark Air's owner. Even with the owner's personal issues the airline still could have done well. Another thing to think about for a minute, if AS could make such a great go of it in Alaska to expand all the way to Orlando, why can't any other regional airline be successful in Alaska? Mark Air's biggest mistake was being perceived as a serious threat by AS.

It is very easy for all of you who sit in the land of competitive markets to discuss the high cost of operating in Alaska, yada yada yada, but the truth of the matter is it is simply a lack of competition. Why no competition? Back to the predatory pricing issue. As Alaskans we have witnessed our costs go through the freaking roof with the disappearance of Mark Air.

We DO get hosed in Alaska. The RASM is absolutely huge intra-state, the only route AS has that is comparable to the Lower 48 in cost per air-mile is the ANC/SEA run... hmmmm.... the only run with competition. It might be noted that these are all legacy carriers competing in the ANC/SEA market.

Yes, we choose to live up here but ketchikandie is quite accurate in their observation. AS hoses Alaskans because they can. AS kept Mark Air out of the market with predatory pricing.

Again, nothing deragatory about AS because I am still in that Head-over-heels-love-infatuation phase with them for finally giving me my Alaskan Amber.

Alison

ketchikandie

reading through the threads, another question popped into my mind. (this is purely curiuosity, not dissing anyone).
if a flight out of ANC to SEA costs $358, why is the price to hop on the same plane on the last leg of its flight to get to the same destination cost more than that?

SEA_Tigger

The barriers to entry to a new start-up are brutally high.

Witness the collapse of BubbleJet at IAD. They were nothing without UA, which they learned soon enough, and now, if they are lucky, will slink back as a United Express partner. Larger airlines are better able to survive the bloody fare wars the newcommers have to start to get people to join.

If MarkAir matched or exceeded AS prices, who would fly them? So they have to deeply undercut AS and AS then has to match, but AS has more routes generating revenue and a larger cash balance to draw from, so they can better survive the wounds.

WN could easily match AS route-for-route, but WN lives off quick turns and that is probably somewhat tough during the winter months at many AK stations, not to mention WN would have to invest in avionics upgrades for their equipment.

I don't see any of the "Big Six" (UA, AA, CO, DL, NW, US) interested in expanding AK service. Of the six, only UA has the western US and MEX presence to match AS route-for-route, but they would need to update their Airbus and 737 fleet to operate around AK.

So until someone with a billion (or more) in cash they're willing to burn through starts AK service and is able to hold the line against AS' better financial position for the few years it will take to secure their beachead and passenger base, AS is going to remain the only game in town for most AK residents.

That is just the way it is.

SEA_Tigger

Supply and demand.

It costs me more to fly SEA-SFO, then SEA-SFO-BOI, because demand on SEA-BOI is a lot less then SEA-SFO.

On the flip side, flying SEA-IAD-BGM on NH costs more then SEA-IAD because there is a lot more demand - and competition - between SEA and IAD then IAD-BGM.

Demand to and from BGM from anywhere is very low, so IAD-BGM is only a few times a day, on small inefficient aircraft that are mostly empty, so the costs of providing the service is extremely high, which means fares must be high to support the route's existance.

Because demand is so low, competition is unknown because two carriers serving the market would just ensure both lost bucketloads of money. So only one carrier serves it and they price it at a level that pays the cost of providing the service. The folks who live/travel there have little choice (ITH is even worse, and ALB and SYR are ~100 miles away), so they pay the fares.

RoyalFlush

Just a trivial correction – SWA commenced service in 1971.