Making some 'cents' of the airline industry

"Can you believe the airlines are raising the price of tickets again?" asked my neighbor, who is still grousing about getting charged for checking a second bag on his last flight and paying a surcharge equal to nearly half the price of the ticket itself. "I think it's some kind of experiment to see how much passengers will take before they finally shout 'uncle'."

In case you missed it, the big three carriers recently raised the price of their round-trip flights by $20 to help offset the rising cost of oil. Apparently, oil is greasing the palm of somebody, but it's not buttering any bread for the airlines or their passengers.

The airlines have cut services to the bare bones. They fill their aircraft to capacity and yet they still land in bankruptcy court. What gives?

According to frequent flier Mike Caswell, it's Economics 101.

"Any good business knows, if you're losing money, you create demand and you raise your prices," said Mike. "Or you do something to attract more sales."

But, according to Mike, the airlines break all the rules. They eliminate the perks that would entice new passengers and sell their tickets below cost. It's a formula for failure.

Fellow traveler Dave Johnson agrees.

"The airlines have cut their staffs to skeleton crews; there's virtually no service left," said Dave, who spent 60 minutes listening to elevator music while waiting to speak to a live agent on a phone call. "If I treated my customers this way, my business wouldn't last a year."

Before the airlines deregulated the airlines, ticket prices made sense. The further you flew, the more it cost. Airlines competed for passengers by wooing them with more service. Flights scheduled for less than two hours offered dinner services with two entrée choices in economy class. Flight attendants passed mints and chewing gum before takeoff and landing. And passengers had a choice of magazines to read during every leg of the trip.

But ever since the Reagan years, ticket pricing has become a free-for-all while there's nothing free about the in-flight service. On any given flight, some passengers will pay bargain prices for a ticket, while for someone else, the sky's the limit. On a recent flight from San Francisco, my seatmate paid close to $600 for his seat, while mine cost less than $300. The meal service was non-existent, so both of us flew for peanuts.

Many passengers say they have reached their limits.

"Airports are as bad as the highways now," said one man, who had been waiting in a security line for more than 20 minutes at LaGuardia Airport in New York City. "Everything is backed up. It just isn't fun."

And for many it's not practical. Rather than fight the crowds or pay exorbitant prices for a first-class seat, many businessmen are letting their fingers do the walking and making a conference call instead of a flight reservation.

The airlines are in a precarious situation. Over the past several months we've seen many of the smaller carriers grounded for good. And some of the larger ones are looking at mergers as a way to stop the tailspin.

I believe it was Richard Branson who once said the way to make a millionaire was to sell an airline to a billionaire. No other industry has seen so many of their companies get their wings clipped so fast. Somebody needs to make some "cents" out of this industry.

Gail Todd, a free-lance writer,worked as a flight attendant for more than 30years. She can be reached via e-mail at gailtodd@aol.com.