Following the Airline Deregulation Act of 1978 airline ticket prices plummeted due to competition. Since then prices have continued to drop until they reached the low prices they are currently at. Airlines have not always tended to the general public, in fact most of the flights airlines took mainly pampered to the upper class. With gas prices continuing to rise and ticket prices lowering due to competition and websites such as expedia, orbitz, etc. has brought traveling via flying and driving to be approximately the same price. Especially with airlines not selling that many of their own tickets and them rather being sold by internet sites, and other travel agents prices have continued to drop.
I feel that flying should be slightly more expensive than driving to aid in the value to flying to the general public. Although most of the general public should be able to fly in my opinion, I feel that it has largely lost its value and is now taken for granted and used without much gratitude. This is why we need to increase the ticket prices slightly, in order to create a greater value of the ticket. It seems that there is mostly criticism and not very much appreciation for the airline infrastructure in the United States.
If airlines raised their prices too dramatically then there would most likely be a lot of mergers, and numerous airlines would close down. If there is only a slight increase in prices, less people would be able to afford trips via airlines however it would hopefully create more value and appreciation for air travel. The industry would have fewer airlines to compete against each other, however the competition between those airlines would be greater. Airlines could certainly use some help since numerous of the majors have been struggling and been forced to merge with other airlines or close down. Some airlines have already begun to stop making trips to certain locations so frequently, or at all and this has helped them financially. This strategy helps them combine trips and have generally more people per flight. Limited scheduling also gives value to the ticket since it is only at certain times. Although it is a good start to adding value to air travel, it needs to be worth more to the general public.
Are you in favor of reversing the deregluation of airlines?
ReplyDeleteNo, as I feel that competition plays a very vital role in our economy and with regulating prices again it will not allow for that. I feel that it should be a movement within the airlines to slightly raise the prices of their tickets to protect themselves better financially.
ReplyDeleteI agree with your points, however an organized "movement within the airlines" would most likely be illegal and the first airline to make a move would be taking a sizable risk. So then what?
ReplyDeleteI agree that some raising of the fares is necessary. Today's low prices are only feasible because of painstaking cuts to the companies and their employees. The airline jobs of pre-deregulation are a dream compared to today's job pay/benefit environment.
ReplyDeleteInteresting how you say that people take aviation and the aviation infrastructure in the U.S. for granted. I agree with you. Even myself being a pilot, I don't really think twice about flying commercially.
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