05 January 2005

Watch for Falling Planes... Er, Prices!

This is encouraging.

NEW YORK — Delta Air Lines Inc. (DAL), the No. 3 U.S. carrier, said on Wednesday it would cut airfares by as much as 50 percent for domestic flights and scrap its unpopular Saturday-stay requirements in a move aimed at luring customers back to an airline struggling to avoid bankruptcy.

Other features of the plan called SimpliFares include charging $50 instead of $100 to change tickets and declaring that no one-way coach ticket will cost more than $499 and no one-way first class ticket will cost more than $599.

In addition, the company said it would unveil other changes, including improving its delta.com Web site and "revising" the food it serves aboard its flights. The company also said it is redesigning its aircraft cabins to make them brighter and give them all-leather seats.

The Atlanta-based airline — plagued by high costs, weak revenue, high fuel prices and rising competition from discount carriers — had been expected to make the announcement since early this week.

Since I started university in 2000, I've flown quite a bit more than I ever had before, and on a variety of airlines. My grandmother only flies United, period, end of story. I've flown on at least eight airlines that I can think of, and probably more. I've flown as far west as Portland/Seattle, and as far east as Rome. I say this not to be a braggart, but because it gives me some experience in this issue.

The best airline that I can remember flying on was British Airways, to and from England my first time. I've only been able to afford flying on British Airways once since then, from Heathrow to Düsseldorf and back last August; just a hop. I'm always treated very well by Continental Airlines, and compared to other domestic carriers, I prefer flying Continental. Why? They give me a good product/service, and they do it for cheaper. For the sake of research, I just ran a search on Travelocity to see who's got the cheapest fares for a flight from PDX to Gatwick. The top two are Continental. I can also count on an actual meal, and a meal worth eating, on every continental flight.

In Europe, the budget airlines make an absolute killing. Flying Ryan Air or easyJet can get you to your destination for a few quid. Seriously. When I flew within Europe during my first trip (England to and from Italy), each leg of the trip was £15, and it's even cheaper now; you pay more in taxes than you do for your actual airfare. The only disadvantage is that they tend to operate out of secondary airports, which might require a short (and usually scenic) bus or train ride. There are no frills, the seating's not assigned, but it's comfortable enough, and it gets you where you're going. It's tougher to do this in the States because America is about the size of Europe, but American airline companies are starting to figure out how to make it happen.

There are three things that have killed the big name airlines: 9/11, the Internet, and their own imcompetence. After 9/11, revenue dropped sharply because of the heightened security; people who didn't need to fly didn't fly. The Internet, and sites like Travelocity, Orbitz, Hotwire.com, and Priceline.com allowed people to see just how much the big airlines were bilking them for. Delta is finally coming around and playing ball. They've developed a somewhat risky, but aggressive strategy aimed at simplifying the whole process, and giving customers what they want: a good product at a reasonable price.

Good on them. I've only ever had one difficult flight with Delta, and that was only because every single seat was booked and every single person brought everything but the kitchen sink with them (which isn't Delta's fault). If they can compete with Continental for my business, they should go right ahead. It's yet another example of the power of the free market when governments don't screw around with it.

And all God's little Capitalists said "Amen!"

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