Will airlines and passengers call a truce?
February 25, 2010 ·
But the surveys show that more than half of customers understand why American has had to charge for things they used to expect free, a response Mr. Garton finds encouraging.
“We’re still going through the hardest part of it, because we are unbundling what for the better part of 70 years has been a fixed-price menu,” Mr. Garton says. “You have to get through this phase so people can get used to it.”
Major airlines have been cutting back on frills for more than two decades, ever since American began reducing the number of olives it served in each salad. Hot meals were among the first to go on short flights, sacrificed in a wave of cuts after the September 2001 attacks.
But lately, the pace of change has been faster, and made travel more complex, uncomfortable and aggravating.
“It’s horrible,” says Matthew B. Stern, a professor of neurology at the University of Pennsylvania who can’t avoid air travel because he lectures and consults around the world. But after his golf clubs were lost on a trip he took with his son, he refuses to check luggage. On longer trips, he sends bags ahead by courier, and for short trips he generally gets by with just one carry-on bag.
“Traveling by plane nowadays is like low-class bus travel in the 1950s,” he says.
But back then, bus lines didn’t charge to take a suitcase, or to select a specific seat. And analysts say the airlines have bungled the switch from all-inclusive to à la carte, irritating already cranky fliers even more.
“How do you run an industry where people hate you?” says Robert W. Mann, an airline analyst based in Port Washington, N.Y. “What they don’t realize is the long-term implications of the things that they are doing.”
Mr. Mann says he believes that the dizzying array of new charges, coupled with security uncertainties and the weak economy, is deterring discretionary travelers — those who once thought nothing of jumping on a plane for a weekend trip.
Airlines need those passengers to fill seats left vacant after so many companies cut back on business travel.
They include Sanjay Lad, a dentist who lives in Los Angeles. In the past, he says, he regularly took last-minute flights to nearby cities like Las Vegas for a few days of relaxation. But now he might drive to avoid paying fees, like the $50 he paid last month to check his skis on a round-trip Delta flight to Salt Lake City.
“A lot of us understand the crisis the industry is in,” says Mr. Lad, “but I’d consider whether it’s financially feasible before I just jump on a plane.”
Still, passengers cannot escape some responsibility for the airlines’ tactics, says Tim Winship, editor of SmarterTravel.com.
“We have to look at ourselves in the mirror as consumers, and acknowledge the extent to which our own price sensitivity has contributed to the way things are,” he says.
That sensitivity has been made clear during the recession. After raising fares 15 times in 2008 to offset record fuel costs, the airlines were able to raise prices only four times in 2009, when the slow economy caused air travel to drop by about 25 percent. From July to September, the most recent quarter for which information is available, the average round-trip domestic fare was $306, down from $358 in the period a year earlier, according to the government’s Bureau of Transportation Statistics.
So far this year, airlines have twice tried unsuccessfully to raise average prices. The first was an attempted $16 round-trip increase in January by American, Continental, Delta and United, and a $10 round-trip increase that many carriers tried this month. But low-fare airlines resisted, and prices stayed higher for only a few days before the airlines retreated.
“They’re testing the price elasticity of consumers, and consumers are saying, ‘We’re very sensitive to price,’ ” says Rick Seaney, chief executive of FareCompare.com, which tracks airfares. “Consumers are just expecting weekly discounts. One dollar matters nowadays.”
By contrast, the airlines have had a much easier time adding and increasing fees. The price to check a bag rose 50 percent during the last year, when they collectively took in $3.8 billion in baggage and other fees.
It now costs an average of $25 to check a first bag on many major airlines, though discounts are available if booked ahead online. The airlines have also added surcharges to travel during the most popular times, like the week between Christmas and New Year’s.