They hate the airlines already. So who cares what they think?
People hate gas companies, too, but they buy gas BECAUSE THEY NEED TO.
They aren't flying for the experience, or if they are, they are certifiable and shouldn't be flying because they're not mentally sane and should be in a straitjacket!
So charge them what you need to in order to make money, and tell them to take greyhound if they don't like it.
And tell them greyhound will charge more anyway.
Yes, I know what they say. The customer is always right. Bullcrap. The customer is very often wrong, and companies should not be afraid to tell them this if it is factually accurate.
Second, the other thing they'll say is they'll just flock to another airline. Oh yeah? And what empty seats will they find with airlines cutting capacity and load factors already in the 80s?
This is not directed at Tony, his was just the last post to have the sentiment that the airlines should just raise their fares.
The problem with this argument is that it assumes that air travel is not elastic. The fact is, it is HIGHLY elastic, and, except for a (much smaller than people realize) segment of the business community, and an even smaller segment of others, if the fares were made too high, a lot of people just wouldn't fly, period. Some would drive, but a lot more would just not go anywhere, or anywhere far, for their vacation time. More companies would do things via video conference, etc., and overall demand would go down. The changes could end up being semi-permanent if it went on for any significant period of time.
THAT is the reason they are so concerned with raising fares. No doubt that the low fare competition plays are roll also, but that's easy to work around by selling your last few empty seats at very good rates (adding to the margin with no increase in fixed costs, and just a relatively small increase in variable costs due to higher fuel use).
The yield software pushes the envelope, and they raise the fares as much as possible and offer only a few seats at those cheaper fares, but, as a consequence of the sophistication of the yield software, they know EXACTLY when the demand is falling off due to higher fares. Even though those flights are fairly full, the YIELD is down. You charge more than the competition and the net result is that you fill your airplane with more lower yield passengers, if you want to capture the margin (and no airline can afford NOT to capture the margin, because an empty seat is lost forever, ANY revenue generated from it is a good thing).
