Thursday, December 18, 2014

Airline salad days, and what customers think

Airlines are in one of those periods, which have occurred at least half a dozen times in the 25-plus years I've written about them, when profits soar and the money appears to be pouring in. Yes, they will say, we've lost more money than they made since people starting flying in airplanes, so please leave us alone, don't complain about what we're charging you. But do you as a customer care what the historical profit-and-loss has been, in more than an abstract sort of way? At those airlines that have lost money the losses have been borne mostly by investors who voluntarily put money into airlines, or in many cases by employees whose jobs have at times been uncertain and less than remunerative.

Airline salad days, and what customers think

Airlines are in one of those periods, which have occurred at least half a dozen times in the 25-plus years I've written about them, when profits soar and the money appears to be pouring in. Yes, they will say, we've lost more money than they made since people starting flying in airplanes, so please leave us alone, don't complain about what we're charging you. But do you as a customer care what the historical profit-and-loss has been, in more than an abstract sort of way? At those airlines that have lost money the losses have been borne mostly by investors who voluntarily put money into airlines, or in many cases by employees whose jobs have at times been uncertain and less than remunerative.

The Department of Transportation reported today just how good the airlines did financially in the third quarter (short answer: as well as any quarter since 2002). Analysts now expect that for the full year, the industry's 2010 net income from ticket sales will be about the same as it gets in fee revenue, in the $5 billion range.

The fee-revenue issue, and how consumers know what they will pay in fees before they push the button to buy a ticket, are the subject of a DOT proposed rule-making. The airlines have generally portrayed the issue as a dispute between various elements of the travel business, but two consumer groups mentioned here before, the Business Travel Coalition and the Consumer Travel Alliance say no, it's really a traveler issue, and a question of simple fairness and transparency in pricing. Read what the groups told DOT about the isue here. 

Tom Belden
About this blog
Tom Belden has been reporting about Philadelphia International Airport and other air travel subjects for more than 20 years, writing columns for The Inquirer's Travel and Business sections. His reporting (with colleague Craig McCoy) on baggage handling problems in Philadelphia have been credited with helping to improve the system. His previous blog was called Road Warrior. He can reached at tbelden@phillynews.com. Reach Tom at tbelden@phillynews.com.

Tom Belden
Business Videos:
Also on Philly.com:
Stay Connected