As the child of a former 40-year Continental Airline pilot, I have only lived in the ‘real’ world of airline ticket purchaser for a few years. Before my father retired from the airlines, I lived the good life of buddy passes, and even better, when I was younger I traveled in first class for free because I was not yet eighteen and the airlines actually gave their pilots’ families great benefits back then. When my dad retired several years ago, I got a major wake-up call that has only become louder and more annoying with each passing year. Gone are the days I would take a yearly trip out of the country without giving a thought to the airfare. Now, the prospect of having to pay $600.00 to fly to New York this summer has me biting my nails and stalling on purchasing my ticket.
Yesterday, as I was driving and mulling all this over, I heard a report on National Public Radio that, at first, had me swearing that Delta Airlines was the devil. According to the report on NPR yesterday, Delta Airlines has attempted to raise their airfare eleven times this year, and we are in April, for goodness sake. Five of those times, the airline failed to get the rate raised because the other airlines refused to go along with the hike. Let’s do the math. That means Delta Airlines has raised their rate six times in four month. They have just put another rate hike out there, which if I were a betting woman, I’d say the other airlines will probably take.
Why? Is it because the airlines are made up of corporate pigs who don’t care if the common man, or woman, can afford to fly? No, not really, though it may seem that way to some of you as it did at first to me. The fact is airlines are losing money, and to stay in business, they need to raise their rates.
The Wall Street Journal had an article in MarketPlace this morning in which the headlines read: Airline Net Hits Downdraft. To read the article in its entirety you need to pick up the newspaper or go online. I want to share the bullet points with you.
The first quarter of this year has been particularly brutal for airlines. Why?
- Winter storms
- Rising gasoline prices
- Earthquake in Japan, which weakened demand for travel to Asia
- 2010 was the first profitable year for airlines in 3 years
- The first quarter of 2011 is expected to be a loss for Delta Airlines, United-Continental Holdings, US Airway and American.
- Among the five biggest airlines only Southwest is expected to post a profit. Guess what- that profit is – 3 cents a share.
With another fuel crisis on the rise, we all need to run to our computers and buy our tickets for the summer. Fuel represents 35% of carriers’ cost, up from 24% a year ago. It is a NO BRAINER that tickets will be rising as well.
So Delta may not be the devil, but they are going to be forced to raise rates again if they want to stay in business, which means we, the poor consumers, will pay the price if we want to fly.
Have you purchased your NY ticket yet? If so, did you get a good rate? I’d love to hear how the cost of airlines tickets will affect your decision to attend the RWA conference this summer.
Have a great day!
Julie Johnstone, The Marchioness of Mayhem