Delta Math
Jan 27, 2011 | 5:21 pm
#1
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Delta Math
I finally got around to reading the January SKY magazine. Here's an extract from Richard Anderson's editorial:
...Congress again is proposing an increase in passenger facility charges from the current $4.50 to $7 per flight segment. This increase means airline customers would pay an additional $2 billion in taxes per year - an average of $112 per trip for a family of four.
Let's see: at $2.50 per segment, $112 is 44 segments, or 11 segments per person. The average trip has 5 segments each way?
And you wonder why the airline industry is so troubled...
It reminds me of the SKY magazine editorial a few years ago where tarmac delays in ATL were blamed on all the bizjets there.
...Congress again is proposing an increase in passenger facility charges from the current $4.50 to $7 per flight segment. This increase means airline customers would pay an additional $2 billion in taxes per year - an average of $112 per trip for a family of four.
Let's see: at $2.50 per segment, $112 is 44 segments, or 11 segments per person. The average trip has 5 segments each way?
And you wonder why the airline industry is so troubled...
It reminds me of the SKY magazine editorial a few years ago where tarmac delays in ATL were blamed on all the bizjets there.
Jan 27, 2011 | 5:26 pm
#2
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...Congress again is proposing an increase in passenger facility charges from the current $4.50 to $7 per flight segment. This increase means airline customers would pay an additional $2 billion in taxes per year - an average of $112 per trip for a family of four.
Let's see: at $2.50 per segment, $112 is 44 segments, or 11 segments per person. The average trip has 5 segments each way?
Let's see: at $2.50 per segment, $112 is 44 segments, or 11 segments per person. The average trip has 5 segments each way?
Using that assumption, 16 segments are needed at $7 per segment to make $112. That makes it 4 segments per person for a family of four, or 2 segments each way, which I imagine is indeed typical.
Jan 27, 2011 | 5:27 pm
#3
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he's stating the total cost per family, not the increase from the current cost, so you have to use $7 and not $2.50.
$112 for a family of four on a round trip. That's $28 per person. With 4 segments on a r/t that's $7 per segment.
So the error in his statement is in the word "additional", he should have said "total".
edit to add: steex is saying the same thing, but faster than me by a minute.
$112 for a family of four on a round trip. That's $28 per person. With 4 segments on a r/t that's $7 per segment.
So the error in his statement is in the word "additional", he should have said "total".
edit to add: steex is saying the same thing, but faster than me by a minute.
Jan 27, 2011 | 5:33 pm
#5
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Jan 27, 2011 | 5:42 pm
#6
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not all airports charge the max PFC (though most of the larger ones do). Further, they have to say what they will do with them. MEM currently has no PFC, and CVG lowered their PFC from $4.50 to $3.00 a couple years ago.
Jan 27, 2011 | 5:55 pm
#7
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Having met Richard and engaged in both verbal and written conversations, it is easy to determine that he clearly has an excellence command of facts and details that is very impressive. I am sure that includes good math skills.
Perhaps he should more closely review these editorials before they get published.
Jan 27, 2011 | 5:56 pm
#8
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Jan 27, 2011 | 6:10 pm
#9
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The lack of PFCat MEM has always been one of the reasons NW and now DL has pushed it as a connecting hub, since it is easier to compete price wise.
Jan 27, 2011 | 7:45 pm
#11
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The reality of the taxes is that they aren't taxes on the fliers, they are taxes on the airline. You can check one flight connecting in ATL and another in MEM to prove this. The MEM fare will be higher by the amount of the PFC and the total price is exactly the same....all other factors being equal.
It's a real wonder this industry can make any money at all given the extremely high rate of taxes levied on it.
It's a real wonder this industry can make any money at all given the extremely high rate of taxes levied on it.
Jan 27, 2011 | 8:54 pm
#13
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Don't forget... he also said that there would be one standard of service across DL... regionals and mainline.
I can't even get comparable service on two DL mainline segments.
I can't even get comparable service on two DL mainline segments.
Jan 27, 2011 | 10:33 pm
#15
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PFCs are certainly taxes, but let's clarify that the money stays with the local agency/authority (and according to the FAA may only be used for certain improvements). See http://www.faa.gov/airports/pfc/ Granted, money is fungible so this isn't always as clear cut as it could be. However, this doesn't affect the federal general fund, at least not in a meaningful way.
We can argue the costs/benefits of such user taxes, but ad hominem attacks don't advance the conversation. If we're going to debate this, let's at least stick to facts.
We can argue the costs/benefits of such user taxes, but ad hominem attacks don't advance the conversation. If we're going to debate this, let's at least stick to facts.