Klm is Dead - Long Live KLM

I must have to brush up my economics.
Are you saying that absolute market volume is a proxy indicator for competitiveness and relative price levels?
Fascinating.

hfly

Maybe yes, maybe no, I do know that overall on every single comparison that I wrote above that the US examples are much cheaper than the European examples and that while it may not be a function of absolute capacity that in most cases there is far more competition in the US than Europe and at very worst the same number of competitors.

Captain Schmidt

The article in question is actually comparing the EU (rather than the continent of Europe) vs the US which are both single markets, so discussion about flights to Moscow or Istanbul should really be excluded.

To that extent, the EU and the US are both "big". EU land mass is 4.3m sq km and 500 million people. US land mass is 9.1m sq km (including Alaska as has been pointed out) and 310 million people. I think it's fair to say that these are both big enough to create economies of scale. Despite the smaller population, the US should have an advantage in this as it has been a single market for a lot longer than the EU.

My own personal experience suggests the article is roughly correct but as florin said, we are trying to compare apples and oranges and I suspect that this really reflects my own personal travel within the US vs that within the EU.

Of more interest to me would be an article on why the American consumer gets absolutely fleeced on TATLs originating in the US vs. what the European consumer pays ex-EU but no doubt someone will be along shortly to defend US "free enterprise" (sic).

GUWonder

The European market is no more or less trivial to game than the US market or joint markets -- if anything the European market is easier to game and yet my reviewed costs per seat mile flown on commercially-scheduled passenger flights for intra-Europe travel are higher than for intra-US travel.

hfly

No, but it shows that you have limited range in what EU countries you are talking about, Italy...........Definately. Germany.............about the same........UK, have you priced TATL's out of the UK, especially London over the last..............15-20 years? Also are you including the fuel surcharges and other garbage which many/most big European airlines tack onto trips leaving the EU taht are generally not collected, or even so at a lesser rate than the other way around?

hfly

Oh, BTW, you say that you want to exclude IST, however on average IST often has better fares than some EU destinations, the same generally cannot be said of SVO or DME though.

Captain Schmidt

I assume you're talking to me?

I actually fly relatively often across the Atlantic, mostly between the US and the UK as a matter of fact so I'm pretty sure I have an idea of what I'm talking about. Care to reveal how often you do?

And yes, for comparison I am obviously including all fuel surcharges and taxes that are charged. Sometimes there is little difference, but generally prices ex-UK are cheaper. I've never seen prices from the US be lower.

And we're talking about today, yes? 15-20 years ago is sort of irrelevant in that context.

Captain Schmidt

I said IST should be excluded because it is not in the EU and the article was specifically about EU vs. US.

hfly

Perhaps you are talking about Y fares, I am speaking about Biz fares if that was not obvious. I have averaged EXACTLY 25 Transatlantic segments per year every year since 1986. That is a bit more than 600 in case your math is rusty, furthermore I would posit that 85% plus have been premium fares. My main US gateway has always been JFK, however LAX, ATL, BOS and MIA have figured into it over the years. Furthermore over the years, my Euro Bases have been LHR, IST, CDG, MAD, FRA among others. Depending on fares, ticketing, routing, season and several other factors, my fares may start at different ends of the Atlantic (as I alluded to before) as there is no hard and fixed rule.

hfly

I just chose a random week in Sept, out the 9th, back the 16th in Club

JFK-LHR-JFK $5820
LHR-JFK-LHR 3659 GBP (Appx $5927)

Pretty much the same.

To be fair I can also cite FCO fares to the States that are half that of the other way around, in fact it can go either way, and again has to do with a load of factors.

Captain Schmidt

It would appear then that our experiences are somewhat different, but as I alluded to earlier, mine are based on my own experiences over the last year and a half (in both Y and J). I can't speak to the previous 20-odd years.

Captain Schmidt

Yes, and to be fair, searching both Y and J fares for these dates gives me pretty much the same cost orginating in either ORD or LON so there is obviously no certainty, other than I'll bet next time I actually want to book a flight from the US it will be more expensive

redheadtempe33

Please tell me where these "many" cities are. A city in my home state, Grand Junction, CO, has a population of around 146,000 people. A fairly small town. It is served by SIX different airlines. Bismark, ND (a town of 108,000) has three.

I would add that while personal income tax rates in Europe are generally higher than in the US, the corporate rates are often similar. So, US companies pay the same tax as their European counterparts, but also pay for their worker's health care and retirement (pensions, 401k's), as opposed to Europe, where the government often takes care of such things. Benefit costs are a huge drag on American companies compared to the rest of the world (especially heavily unionized companies).

nkedel

There are plenty of intercity busses; usually that's the one form of mass transit that goes nearly everywhere, even cities too small to have a GA municipal airport.

The general sense people have that Greyhound and similar intercity bus services are uncomfortable (true - and true for coach on the airlines too, but trips are generally much shorter), and unclean/unsafe (not so true, but perception often counts more) means that in general long haul bus service is only considered competitive for the very broke or for those for whom time has very little value.

Klm is Dead - Long Live KLM

Given the true un- and under-employment rates in the US and the direction the country is taking, this would seem to be an incredible growth market opportunity for the amazing US long haul bus service industry!

Unfortunately, most of these tens and tens of millions of citizens without (hope of) discretionary income increasingly have absolutely no where to go... and so will not use the "competitive" grehound buses nor the de-commissioned, historical national air transportation system.