SFO777

Whoa, are you really suggesting that AA is the equivalent of a BMW??

Dr. HFH

Well, that makes sense to me. Competition often goes up with demand; and one of the primary ways to compete is on price. Therefore one might make the argument that the greater the demand the lower the price.


You mean it's not??

OskiBear

I think it's inappropriate to do business with an organization that you find to be despicable.

Why don't you just book away from AA? What is the point of continuing to pay them too much money for a product that you feel is overpriced?

As much as I am "loyal" to AA and enjoy the perks, if there is a significant price or schedule disparity, I'll book another airline.

Focke

Honda Accord would be a better comparison.

mvoight

What about other carriers? If other carriers are carriers are charging about same, what is the "crazy" part?

AA777

Wait....are you suggesting proponents of the merger were talking out their back end and lying when they made claims it would not adversely affect the flying public?

Cheers,
AA777

rjw242

Yes, nobody could have predicted.

But I'm sure that when UA and DL propose their merger 5 years from now, they'll swear up and down that it'll have absolutely no adverse effect on customers and will in fact guarantee low airfares and better service.

MiamiAirport Formerly NY George

The airline industry spent decades in financial limbo. Only in the past several years has the industry returned to financial stability. The question is what is the future of the industry, things rarely stay the same. If the price of oil soars again you can expect higher fares, more ancillary charges and expansion of ultra lccs. However, I do not see the ultra lcc business model ever reaching the point of a major carrier; UNLESS the majors move the E- product to that of an lcc (certainly not unthinkable).

Now, if fuel costs stay relatively low for an extended period of time and we get a real economic recovery new entrants are possible. If the industry is financially strong it could produce new competitors that want to differentiate themselves on the product. JetBlue did that back in the late 1990s, taking the Southwest business model and making customer improvements on it.

For now other than premium long haul, its about the highest price and the lowest level of service.

JDiver

Who can predict the behavior of opportunistic predators? Or sharks?

teevee

wrong answer. in the not too distant past, prices across the then three carriers that offered nonstops on the route were within $10 of each other. then came the "fuel crisis" which started making all travel expensive. fuel leveled off but airfares remained the same--roughly $150-$200 more than they used to be.

then came capacity cuts, allegedly to save the airlines from flying with too many empty seats. in reality, this gave them the opportunity to show increased demand for seats. no .... sherlocks! you have less seats so there APPEARS to be more demand.

then there is the inescapable truth that many people that fly do not do so for pleasure or because they simply want to. factors like work, family, etc often force them to fly.

you are correct on one point only: the free upgrade is no longer free.

imagine if your local supermarket steadily and continuously raised the prices on everything in the store. would you stop buying food? would you defend or explain the practice as being a normal business model of raising prices until people simply stopped eating? or, would you be screaming at the top of your lungs for change and honesty and a call to get rid of greedy corporate whores who would sell their own children to please wall street?

i'm all for everyone, including airlines, to make money. there is however, a boundary that an an unwritten set of rules they should follow.

in florida, the state has laws that prohibit retailers and others from raising prices after a hurricane--generally referred to as anti-gouging laws. some of the best legislation ever written!

however, most people, when it comes to airlines, say, let the market take care of that. let them charge whatever the market will bear. why not do the same after a hurricane? shoot! if y'all can't afford $10,000 for a $1000 generator, too bad. I'll just sell it to the guy who can either afford it or is desperate enough to dig deeper than he should.

rjw242

What you're ignoring is the fact that one carrier is offering the same route for $200 less. Nobody's putting a gun to your head and forcing you to buy AA. And if you (and enough other people) are willing to pay $200 extra to fly on AA, then AA has set their price correctly.

Your price-gouging argument is irrelevant since, again, anyone who needs to fly MIA-MGA can choose TACA for $200 less. Similarly, the comparison of basic necessities like food to frequent-flyer perks (which, as far as I can tell, is the sole reason you don't want to go with TACA) is simply preposterous.

OskiBear

I think this is called "Whole Foods." However, I can still go to my local Vons or Ralphs for a lot less. And, as you pointed out, you can fly UA or DL or some other airline that charges less.

What's with the obsession with AA's pricing? If it's out of whack, no one will buy it and it'll auto-correct or AA will be left with empty planes.

deeruck

Like OskiBear I'd stop shopping at WholeFoods and go to Walmart.

Question for you teevee, would you be this mad if the cheaper option didn't exist? If there was only one airline at $585, would you be happier?

MiamiAirport Formerly NY George

High prices and limited availability on any product line will eventually lead to new entrants. If get to a point of airfares achieving fares similar to pre regulation (adjusted for inflation) but a service far below to what we got then someone is going to see an advantage (no pun intended) of starting an airline that will stress amenities and not just how much can we take away or charge you a la carte. Even Spirit, when you look at the base fare and then consider fees you would have to pay there often is not really any difference. What Spirit tries to do is convince the occasional traveler that they are much cheaper than major carriers. Then lets not forget the wonderful 28 inch pitch and charging to print a BP at a kiosk (no mobile option available).

Eventually another Jet Blue is going to happen (Jet Blue sadly compromised by the Wall Street shrills).

seawolf

As others have said, the price of airfare is driven more by supply and demand rather than the cost of the seat. The management of any publicly traded company that makes the decision to cut prices just because the cost to produce went down should be voted out for failing to maximize value for the stockholders.