“NEW YORK (CNNMoney.com) — As oil prices continue to break records, the nation’s six leading airlines have announced capacity cuts for 2008, trimming flights in major hubs and cutting off service to dozens of discount destinations.
“All told, the industry will cut capacity by 9% in 2008, according to James Higgins, analyst for Soleil-Solebury Research.”
The continued rise of oil prices along with other, which have contributed to the recession we may or may not be in (but, it sure feels like it), has hit major industries deeply from mine (broadcasting), real estate, retail and most notably the airlines.
Never has an industry done so little for so many. So, naturally, the rising crude oil prices, which hit $140 per barrel yesterday (a new record), and the ridiculously rising gasoline costs (as the big oil companies enjoy big profits) have given the airline sector another whack.
Long before we would have thought that there would have been a sub-prime banking-real estate crisis, the airlines have treated us, the paying passenger, like one of those chocolates that Lucille Ball & VIvian Vance as Lucy and Ethel were stuffing in little boxes on a fast-moving assembly line in that classic “I Love Lucy” episode. But, unlike those chocolates, which looked wonderful, there is nothing wonderful about air travel today. It is bad. It’s beyond bad.
Not one U.S. airline has been profitable for years, with the exception of Southwest as their business model continues to dwarf the competition, and they have a now-famous way to hedge fuel, when they lock in prices at present day figures, purchasing volume for years, hence controlling their costs. It was easier when crude oil prices were 80% less, or even 50% less than its closing number as the markets finished for the week. But, SW, which is a basic no-frills carrier, in fact, the most-successful in the industry, has something else that no American carrier possesses: Customer service. While I haven’t travelled on SW in 30 years, I have many friends who do so regularly, and never has there been a major complaint.
The airline industry was deregulated 30 years ago by then President Carter. This brought on a wave of increased competition and lower prices. But, it also brought to America something that we wanted used to: crappy customer service.
The airlines just don’t care about us. They have a disdain for the customer. They have continually found opportunities to make life utter hell for us. Yet, there are so many loyal passengers that stayed with you, others have moved from the so-called legacy carriers to Southwest, jetBlue and Virgin America. Overseas travelers, who don’t travel in upper class, take the cheapest route.
We’re now being charged for luggage, unless we’re lucky enough to be elite members of their frequent flier programs, which used to allow us an opportunity to redeem miles for “free” travel. So, passengers are discriminated against if they haven’t accrue enough miles in a year to get that oh-so beautiful silver or gold card.
Item: “US Airways announces it will no longer offer free non-alcoholic beverages or snacks on its flights.”
So, here we are reading daily how airlines are piling on the costs to the passengers in the name of rising petrol prices, which, to be fair, is not their doing. And they continue to take away any semblance of customer service or as some like to call it customer ‘care’.
As a good friend put it in one of his blogs, “you have turned us into packages moving through your system.”
We aren’t alone. Employees of the airlines, once the shining stars of the airline industry have been treated unfairly and there’s certainly no job security for them either. Remember those Pan Am flights, during their heyday? If you’re not that old, check out the videos on the web with the wonderful commercials highlighting what air travel used to be until the 1980s. Now that was air travel. But, Pan Am is gone, too.
At the end of the day, we’ll begin to hear about further consolidation, which will certainly continue to raise ticket prices, or we’ll be reading about possible airline closures, which seems to be more likely today than at any other time.
I don’t like to see people lose their jobs nor companies suffer.
But, the airline industry has brought much of their plight on themselves. I won’t be losing a night’s sleep for the situation they find themselves in today.