Irony alert – airlines not happy with new airport fee hikes

by Scott Carmichael on

In what I can only describe as “you have to be kidding me”, the Association of European Airlines (AEA) slammed European airports for increasing the fees they charge for the right to use their facilities.

These fees are passed on to passengers in the form of “passenger facility charges”. The airlines claim that increasing these fees is not fair in this current economic climate, and that the fees will only hurt them even more, especially since air travel is at an all time low.

What they really meant to say is that they should be the only ones that are allowed add ridiculous fees to their tickets.

It boggles the mind that the very same airlines that are introducing baggage fees, booking fees, airport check-in fees and other insane charges don’t want to allow airports to recoup some of their investments by raising their prices.

The airport fee hikes are used to improve facilities, add more gates and expand when needed. Unlike the airlines who use these fees as nothing but a new money making scheme. If adding a couple of bucks to my ticket means I get a better airport, I’m 100% for it – I wish the same could be said for the fees the airlines charge – I pay more, but on many carriers I get the same crappy service.

On-time airline improvements continue, third month in a row

by Tom Johansmeyer on

Airlines in the United States posted an improved on-time performance rate in April relative to the same month the year prior – stretching their streak to three. The 19 largest airlines were on time 79.1 percent of the time in April 2009, compared to 77.7 percent in April 2008. The industry also performed better than it did in March 2009, showing a month-to-month improvement from 78.4 percent. An on-time arrival is defined as being within 15 minutes of the scheduled time … which has already been buffered comfortably by the airlines.

According to the U.S. Department of Transportation, 7.4 percent of April delays resulted from aviation system issues. Late-arriving aircraft caused 6.2 percent, and factors within the airline’s control (e.g., maintenance or crew problems) accounted for 4.8 percent. Extreme weather and security together didn’t even account for 1 percent of delays. The most delayed flight was Northwest Airlines Flight 803 from Atlanta to Honolulu. It was late 97 percent of the time.

The DOT also found that:

  • Cancellation rates improved to 1.5 percent in April 2009 – from 1.7 percent in April 2008 and 2.1 percent in 2009.
  • Nearly 50 flights had taxi-time waits of greater than three hours
  • Mishandled baggage rates improved to 3.79 per 1,000 from 4.99 in April 2008 and 4.12 in March 2009

Customers complained to the DOT 781 times about airline service, compared to 1,112 in April 2008. But, it was up from the 705 the previous month.

So, the airlines are generally posting some positive numbers – Fight 803 notwithstanding. Why? Are we looking at a vast improvement across an entire industry … an industry that clearly can’t afford to invest in doing a better job?

Let’s not go crazy, here.

The airlines are doing a better job because they don’t have to deal with as many people. Fewer asses are occupying seats, which eases the burden of boarding passengers, pushing back on time and keeping track of their luggage. Ironically, success is the path to failure, as selling more seats would give airlines an operational burden they’ve proved they’re ill-equipped to handle.

Pay to pee on Ryanair no joke

by Tom Johansmeyer on

Remember when we called Ryanair’s plans to charge for lavatory access a stunt? Yeah, we do, too. Those were simpler days, I guess. It turns out, that stunt concealed an even larger one. CEO Michael O’Leary announced that the airline will begin charging one pound (around $1.65) for access to the special rooms at the front and back of the plane.

I actually see some restraint on the press-whorish CEO’s part. I expected him to break the fee down by bodily function, charging a premium for what results in a bit more time. After all, time is money, and one person’s long stay could cost a few extra bucks because other passengers may not get their turns.

But, the savvy airline leader is hedging his bets … as he did with the fat tax, which is now off the table (O’Leary calls it “impractical”). No start date has been revealed; only a two-year time horizon was given. But, he does say, “We are serious about it.”

There’s only one way to make this better, and O’Leary’s found it. Instead of charging for the existing abundance, he’s planning to tear a few out of each plan, in order to make room for more seats. This works in two ways. First, there are more people on the plane who become potential piss-payers. Also, there are fewer lavs, creating a scarcity of resources.

Delta backtracks on extra bag fees

by Tom Johansmeyer on

Delta is caving to competitive pressures, cutting its plans for extra bag fees on international flights. The airline says that others have not matched its fee of $50 for the second bag checked on international flights. Now, it will only apply to travel between the United States and Europe. The fee is effective July 1, 2009.

Originally, this new fee was supposed to bring the battered airline (aren’t they all?) – which also happens to be the world’s largest – another $100 million in revenue. That’s a lot of cash, but it’s probably realistic. After all, fees for extra bags brought Delta an additional $177 million in 2008, and it was good for an extra $1 billion for the airline industry as a whole.

First and business class passenger are exempt, given the exorbitant sums they’re laying out already. Also, active military passengers will not have to pay for a second bag – which is as it should be.

Misery works: airlines making money on baggage fees

by Tom Johansmeyer on

The one thing nobody says about the “nickel and dime” strategy is that it can work. For the airline industry, charging passengers for extra bags translated to more than $1 billion in lifeblood to a struggling business last year, according to the Department of Transportation. As much as you may hate to shell out that extra cash, last year, it went to businesses that desperately needed it.

Before the financial decay spread to every corner of the business community last year, airlines typically allowed two pieces of checked luggage per person and charged for anything else that followed. Then, United Airlines started demanding that passengers throw down $25 for a second bag, with US Airways following to the tune of $15.

It adds. Up. United brought in an extra $133 million. Delta picked up an extra $177 million. American Airlines wins with $278 million last year from baggage fees. Even Southwest Airlines pulled in an extra $25 million. Rick Seaney, CEO of Farecompare.com, believes that baggage fees could be worth up to $3.5 billion in 2009.