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LA Times: Fuel Surcharges Up Up And Away  
User currently offlinePlateMan From United States of America, joined May 2007, 922 posts, RR: 0
Posted (6 years 5 months 2 weeks 2 days 18 hours ago) and read 2040 times:

Interesting article in this morning's LA Times about how fuel surcharges keep rising (no surprise) but how they equal about half the cost of tickets.

http://www.latimes.com/business/la-fi-airfares29jan29,0,5847646.story

"You can argue forever about whether this is justified, but how they are doing it shows their worst nature."

Airlines just add more and more surcharges.

[Edited 2008-01-29 04:51:28]


"Explore. Dream. Discover." -Mark Twain
16 replies: All unread, jump to last
 
User currently offline2175301 From United States of America, joined May 2007, 1026 posts, RR: 0
Reply 1, posted (6 years 5 months 2 weeks 2 days 18 hours ago) and read 2004 times:

Ahhh.... I can see it now.

Fly NY to LA.... only $9.99 + taxes and fees...

Now the whole family can afford to fly - enjoy that dream vacation and have more money to spend on other things...


Fuel surcharge $175
Airport Fees $30
Flight Crew Fee $35
Maintenance Fee $75
Interest surcharge $57

What a concept.... Are you all ready for airline tickets to be sold like this?


User currently offlineAuroraLives From Canada, joined Nov 2007, 179 posts, RR: 0
Reply 2, posted (6 years 5 months 2 weeks 2 days 18 hours ago) and read 1981 times:

From this thread ( Cost Of A Tank Of Gas On A 777? (by AuroraLives Jan 28 2008 in Civil Aviation) ) some very helpful people showed how to calculate the fuel cost for a flight.

As the LA Times article suggests, I checked out Tokyo - Hololulu (6216km) on United on Feb 24th. The fuel surcharge per passenger looks like $150 per person per direction.

Assuming United uses the 348 seat 777 on this route... total fuel surcharge is $52,200. By the calculations in the above thread, the TOTAL fuel bill for this flight would be around $53,000.

Sooooo... this PROVES that the "fuel surcharge" has nothing to do with the "rising" cost of oil. The ENTIRE cost of the fuel for the flight is broken out as a separate charge. I'm still looking for an example where the fuel surcharge is > total fuel cost..... would they even be allowed to use "fuel surcharge" in that case???


User currently offlineBond007 From United States of America, joined Mar 2005, 5394 posts, RR: 8
Reply 3, posted (6 years 5 months 2 weeks 2 days 17 hours ago) and read 1955 times:

"In the U.S., major airlines charge about $20 in fuel fees for domestic flights. On Monday, they doubled the surcharge to $40. ...The fuel charges are generally hidden in a ticket's fine print under 'taxes and fees.' "

Quoting 2175301 (Reply 1):
Fly NY to LA.... only $9.99 + taxes and fees...

As I mentioned on the other thread, and AFAIK (unless it has been changed), this 'hidden tax' is only true for international flights.

For domestic flights at least, only certain government imposed fees and taxes can be excluded from the advertised base fare.

I know the article does mention international ... but it's easy to interpret it as meaning all flights.


Jimbo



I'd rather be on the ground wishing I was in the air, than in the air wishing I was on the ground!
User currently offlineMEA-707 From Netherlands, joined Nov 1999, 4295 posts, RR: 36
Reply 4, posted (6 years 5 months 2 weeks 2 days 17 hours ago) and read 1901 times:

In Europe, at least the Netherlands, consumer organizations got so fed up with the hidden fees, since a year airlines and travel agents are forced by law to advertize with all in costs, or at least make it clear early on what the total price is, and not only after entering name and creditcard details on the final booking.
Ryanair and some other airlines with international sites don't comply, but still it makes trip alternatives much clearer to compare.
In the USA the taxes were until a few years ago a low nominal fee, like $ 10-20 for a domestic flight. Now the airlines got so tempted to throw more surcharges outside their advertized price that I am sure consumer groups etc. will get so annoyed that they also force them to be more clear and honest. Things like this should be done by law, as for individual airlines it's beneficial to advertize with the lowest prices while others put the full totals in their PR.



nobody has ever died from hard work, but why take the risk?
User currently offlineFiatstilojtd From , joined Dec 1969, posts, RR:
Reply 5, posted (6 years 5 months 2 weeks 2 days 15 hours ago) and read 1835 times:



Quoting 2175301 (Reply 1):
Ahhh.... I can see it now.

Fly NY to LA.... only $9.99 + taxes and fees...

Now the whole family can afford to fly - enjoy that dream vacation and have more money to spend on other things...


Fuel surcharge $175
Airport Fees $30
Flight Crew Fee $35
Maintenance Fee $75
Interest surcharge $57

What a concept.... Are you all ready for airline tickets to be sold like this?

yes, because when you cancel such an el-cheapo "non_refundable" Ticket at least here in old Europe you are entitled to get the Taxes (excl. a few bucks admin. fee) back.


User currently offlineBond007 From United States of America, joined Mar 2005, 5394 posts, RR: 8
Reply 6, posted (6 years 5 months 2 weeks 2 days 15 hours ago) and read 1828 times:



Quoting Fiatstilojtd (Reply 5):
you are entitled to get the Taxes

I didn't see any taxes in that list ... the point perhaps.


Jimbo



I'd rather be on the ground wishing I was in the air, than in the air wishing I was on the ground!
User currently offlineFiatstilojtd From , joined Dec 1969, posts, RR:
Reply 7, posted (6 years 5 months 2 weeks 2 days 15 hours ago) and read 1808 times:



Quoting Bond007 (Reply 6):

I didn't see any taxes in that list ... the point perhaps.

At least at the moment here in Europe the Fuel Surcharges are "included" in Taxes...so you get them refunded if you do not take a "non-refundable" Flight.


User currently offlineBond007 From United States of America, joined Mar 2005, 5394 posts, RR: 8
Reply 8, posted (6 years 5 months 2 weeks 2 days 15 hours ago) and read 1780 times:



Quoting Fiatstilojtd (Reply 7):
At least at the moment here in Europe the Fuel Surcharges are "included" in Taxes...so you get them refunded if you do not take a "non-refundable" Flight.

Well, it may be different in certain countries, but AFAIK there are no general regulations requiring European airlines to refund taxes and charges for non-refundable tickets .... although many, if not most, do. In fact some of those that do, specifically exclude fuel surcharges, and only include those government and airport imposed taxes and fees.

Quoting Fiatstilojtd (Reply 5):
excl. a few bucks admin. fee)

Well, this is where you may get some disagreements on your 'few bucks' estimate.

In fact many European airlines charge anything like 20-30 Euros admin charge ... which in many cases is greater than the taxes/charges you would have been refunded. There are also few regulations limiting the amount that the airlines can charge in admin fees.


Jimbo



I'd rather be on the ground wishing I was in the air, than in the air wishing I was on the ground!
User currently offlinePanAm747 From United States of America, joined Feb 2004, 4242 posts, RR: 9
Reply 9, posted (6 years 5 months 2 weeks 2 days 9 hours ago) and read 1681 times:

Imagine...the NERVE of some airlines...wanting to pass on the cost of higher fuel to their CUSTOMERS!! Is nothing sacred anymore?

I mean, a whole $40 on a cross-country ticket!! That's going to break the bank!! I'm calling my congressman...those lazy airlines are taking food out my childrens' mouth, and I won't stand for it!!

There...that was my impression of the typical American consumer finding out about this "illegal tax".

Considering that, when adjusted for inflation, it is actually cheaper to fly now than has been in the past, consumers are still getting a bargain. The relentless "giving-away-of-the-store" by airlines and subsequent lowering of EVERYONE'S expectations of "service" has been well-documented.

If airlines want to call this a "fuel surcharge", let 'em. If consumers want to freak out about an increase in the price of their ticket hidden in the taxes and fees, let 'em. If $20 breaks the bank, then you shouldn't be flying. Keep your money for filling up your Canyonero SUV that gets 8 mpg.

Ranting over.



Pan Am:The World's Most Experienced Airline - P(oor) S(ailor's) A(irline): San Diego's Hometown Airline-Catch Our Smile!
User currently offlinePlanemaker From Tuvalu, joined Aug 2003, 6074 posts, RR: 34
Reply 10, posted (6 years 5 months 2 weeks 1 day 22 hours ago) and read 1608 times:



Quoting PanAm747 (Reply 9):
I mean, a whole $40 on a cross-country ticket!! That's going to break the bank!! I'm calling my congressman...those lazy airlines are taking food out my childrens' mouth, and I won't stand for it!!

Quite funny how there are a couple of conflicting threads running on a.net about fares and "rational pricing."



Nationalism is an infantile disease. It is the measles of mankind. - A. Einstein
User currently offline2175301 From United States of America, joined May 2007, 1026 posts, RR: 0
Reply 11, posted (6 years 5 months 2 weeks 1 day 19 hours ago) and read 1560 times:



Quoting PanAm747 (Reply 9):
Imagine...the NERVE of some airlines...wanting to pass on the cost of higher fuel to their CUSTOMERS!! Is nothing sacred anymore?

I mean, a whole $40 on a cross-country ticket!! That's going to break the bank!! I'm calling my congressman...those lazy airlines are taking food out my childrens' mouth, and I won't stand for it!!

There...that was my impression of the typical American consumer finding out about this "illegal tax".

Considering that, when adjusted for inflation, it is actually cheaper to fly now than has been in the past, consumers are still getting a bargain. The relentless "giving-away-of-the-store" by airlines and subsequent lowering of EVERYONE'S expectations of "service" has been well-documented.

If airlines want to call this a "fuel surcharge", let 'em. If consumers want to freak out about an increase in the price of their ticket hidden in the taxes and fees, let 'em. If $20 breaks the bank, then you shouldn't be flying. Keep your money for filling up your Canyonero SUV that gets 8 mpg.

Ranting over.

I have zero problems with the airline charging for the change in fuel prices.... My problem is that since they know that it is $20, or $40, or whatever that they just dont say that the ticket price is that much extra. Ever notice how the airlines seem to know what the fuel surcharge is - in advance... Why then is this considered a surcharge item.

Let me give you two common business practices that account for change in prices:

1) UPS publishes shipping rates only a few times a year... If fuel goes up beyond a certain point they add a fuel surcharge at time of shipping, said fuel surcharge varies too (as the price fo fuel moves up and down).

2) I helped negotiate a contract worth about $13 million for my plant recently. A key material component is about 1/3 of the total cost - and prices have been fluctuating wildly. The contract price is based on that material costing $x.yy per lb, and a material surcharge - or savings - will be determined by the difference of the actual purchase price of that material for the project (the vendor will show us the invoices for that material). We do not know if we will be paying more or less than the base contract price.

The airlines do not seem to be following either model. Since they are constantly changing their rate structures to supposedly adjust for cost it is harder to claim that they even need a fuel surcharge; and if they do - how do they know much prior to the time of service delivery what that surcharge will need to be (and how come there are never any fuel credits).

In the case cited at the start of this thread - the fuel surcharge works out to essentially the entire fuel bill for the entire trip (assuming a full plane). That is not just an adjustment for inflated fuel prices - its a lie. Big difference.

The issue has nothing about $20, $40, or even $150. The issue has to do with how the airlines are presenting the cost of a ticket and are they being truthful up front.


User currently offlineAuroraLives From Canada, joined Nov 2007, 179 posts, RR: 0
Reply 12, posted (6 years 5 months 2 weeks 1 day 18 hours ago) and read 1524 times:



Quoting PanAm747 (Reply 9):
Imagine...the NERVE of some airlines...wanting to pass on the cost of higher fuel to their CUSTOMERS!! Is nothing sacred anymore?

I mean, a whole $40 on a cross-country ticket!! That's going to break the bank!! I'm calling my congressman...those lazy airlines are taking food out my childrens' mouth, and I won't stand for it!!

Please see my post #2 in this thread. Yes.. it's cheaper to fly now than before. Yes.. $40 surcharge on a cross country flight will not break most people.

BUT... as I show in post 2... the "fuel surcharge" is dangerously close to the ENTIRE cost of fuel for the flight. This is NOT a surcharge based on fluctuating prices, but rather charging for the fuel on top of the basic fare.

I think what irks most people is that if this is "accepted" by the traveling public, what is to stop the airline from saying the base advertised fare is $2 + Fuel + Pilots + Crew + Airline Amortization Costs + Used Tire Recycling Fee + Corporate Lawyers + Advertising and Marketing Fee + Painting + etc, etc etc..... = $924 total price.


User currently offlinePlanemaker From Tuvalu, joined Aug 2003, 6074 posts, RR: 34
Reply 13, posted (6 years 5 months 2 weeks 1 day 12 hours ago) and read 1472 times:



Quoting AuroraLives (Reply 12):
BUT... as I show in post 2... the "fuel surcharge" is dangerously close to the ENTIRE cost of fuel for the flight. This is NOT a surcharge based on fluctuating prices, but rather charging for the fuel on top of the basic fare.

Also, as the LA Times article points out, the surcharge is free from corporate discounts on biz fares so it is a great way to soak corporate customers.



Nationalism is an infantile disease. It is the measles of mankind. - A. Einstein
User currently offlineSMcC From United States of America, joined Sep 2000, 48 posts, RR: 0
Reply 14, posted (6 years 5 months 2 weeks 1 day 11 hours ago) and read 1450 times:

I am ALL for this.
The airlines MUST learn to pass their costs on to the consumer.
AND the flying public needs to learn not to expect to fly coast to coast (...or whatever) for less than it costs to fill up the tank in their car. Ridiculously low fares are not good business.


User currently offlineRobsawatsky From Canada, joined Dec 2003, 597 posts, RR: 0
Reply 15, posted (6 years 5 months 2 weeks 1 day 11 hours ago) and read 1438 times:



Quoting SMcC (Reply 14):
I am ALL for this.
The airlines MUST learn to pass their costs on to the consumer.
AND the flying public needs to learn not to expect to fly coast to coast (...or whatever) for less than it costs to fill up the tank in their car. Ridiculously low fares are not good business.

And you've splendidly missed the point. The issue is not the overall price but the way it is presented.

Airlines know perfectly well how to pass their costs on but unless you don't believe in free-enterprise, the airlines and their competitive strategies are responsible for the fares not the customer. Management is responsible for good business practices and ridiculous fares may be part of a necessary competitive tactic when used judiciously. Consumers expect exactly what the airlines want them to expect (low fares). But, what consumers don't expect is obscure pricing of total fare.


User currently offlineSMcC From United States of America, joined Sep 2000, 48 posts, RR: 0
Reply 16, posted (6 years 5 months 2 weeks 1 day 10 hours ago) and read 1415 times:

Well excuse me Rob

...I should have known better than to post something on here.

It's entirely possible that I missed something that you didn't, but reading this thread got me thinking about airfares and how sometimes seats are sold way below what it costs to provide them. You may think it was off topic, I don't.


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