I'd personally like to thank the U.S. Gov't & our Anti-trust Department
- Thread starter deepsea21
- Start date
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I don't know about charged more, they may have a financially better deal due to signing it years ago or discounts for volume of gates. As for clout for not allowing another airline to use gates, maybe not stop another airline from getting available gates, but certainly by leasing gates and taking them out of the availability pool.
If that is what they are doing it sounds like how we do things in America. But it may just be that another airline knows that if they split the flights with Delta they will not fill airplanes and will not make money.
Right now another car lot in our area is putting in a tow truck operation. I've seen it before over the last 30 years and they will not make it but they will reduce our tows in the area by splitting them 3 ways instead of 2. They have not done their research or they would know that it will not work and has not worked in the past. We are established enough that we will get through it at reduced or no profit. Our new competitor will get tired of working for nothing. I'm guessing Deltas competitors have done their research and know if they split the current market to Cozumel their planes will fly half empty. No money in it. Why do it?
They all seem to have their hubs, I'm sure it's like any on going endevour, you know where your competitors are dug in and are always weighing the pros and cons of invading their territories based on their strengths and weaknesses in certain markets. There is always that unwritten, unspoken strategy going on of we leave them alone in their strong territory they leave us alone in our primary territory and we battle it out in middle areas somewhere.
I think that is it. But there is no point in invading a small market where another operator will make it impossible for any of the operators to run full flights. I believe full flights are where the money is.
That's probably part of it. From what I read in the local news, Delta has Atlanta by the throat. They are a major employer here. The city, which owns the airport, does everything it can to keep Delta happy. I have read insinuations (which Delta denies) that Delta uses its position to do everything it can to hamper competition at ATL. If true, then the same thing probably goes on at other airports that are a major carrier's main hub.
Here's a thing: The CZM airport is very small compared to CUN. Cozumel doesn't have the infrastructure to be able to handle many more flights per day. I came in once on the third of four planes to land there in a pretty short time, and I stood in line in Immigration for longer than I was in the air from HOU.
OP
deepsea21
Contributor
We used to have numerous airlines and stiff competition in the U.S. with American, United, U.S. Air, Delta & Continental all serving Coz. Today we have American and Delta serving coz with United showing up here and there. The Anti-Trust department even initiated an investigation on airline price fixing a year or so ago. What was the outcome... Nothing because there is no evidence of price fixing. Anyone surprised? There's no evidence because there's no need for the airlines to communicate about price fixing. With only 4 major airlines in the U.S. all they have to do is not step on each other's toes. It's like an unspoken "Gentleman's Agreement" these days. The smaller discount carriers don't even try to enter major domestic routes because as soon as they may try a flight out of ATL to COZ all of a sudden the super-carriers will slash their fares and fly at break-even or at a loss on that route to drive them out. That is called "competition" today and the big airlines can say, "See, we are competing for this route" while their 5,000 other routes absorb the cost of "competing" with a small airline trying compete and start a new route at a reasonable price that works for them financially.
You need look no further than the profits the super-carriers that are left are reporting! Record profits as fuel prices have crashed (yet the baggage fees remain) and fares continue to rise (at least for me). Furthermore, I remember when we'd fly large planes into coz... of late, AA and Delta have stuck us on those mini-jets even from Atlanta, Miami, and Houston depending on demand at the time. THose little jets make sure there's not even crumbs left for a true low-cost competitive carrier.
As far as fuel hedges are concerned - Airlines hedge no more than 2 years out at the absolute max and they never hedge all fuel requirements just in case prices fall further. With record low fuel prices now going on for as long it has one would think fares would fall and bag fees would vanish but no way - not with no true "competition". Even if a small competitor tries to fly out of a secondary airport to another secondary airport each of which may be 1/2 - a 1HR drive from thelarge, regional airport what happens? The super-carriers drop prices to the point that th extra 30 min or 1 hour drive on each end can'e be justified by the savings. Airfares to CUN are exemplary of this - They knwo what it costs to take a hopper to CZM or do the bag drag to PDC with a ferry. They've priced that route perfectly because for most going to CZM, it's not worth saving a few bucks for the hassle of the bag drag or hopping the island hopper.
You need look no further than the profits the super-carriers that are left are reporting! Record profits as fuel prices have crashed (yet the baggage fees remain) and fares continue to rise (at least for me). Furthermore, I remember when we'd fly large planes into coz... of late, AA and Delta have stuck us on those mini-jets even from Atlanta, Miami, and Houston depending on demand at the time. THose little jets make sure there's not even crumbs left for a true low-cost competitive carrier.
As far as fuel hedges are concerned - Airlines hedge no more than 2 years out at the absolute max and they never hedge all fuel requirements just in case prices fall further. With record low fuel prices now going on for as long it has one would think fares would fall and bag fees would vanish but no way - not with no true "competition". Even if a small competitor tries to fly out of a secondary airport to another secondary airport each of which may be 1/2 - a 1HR drive from thelarge, regional airport what happens? The super-carriers drop prices to the point that th extra 30 min or 1 hour drive on each end can'e be justified by the savings. Airfares to CUN are exemplary of this - They knwo what it costs to take a hopper to CZM or do the bag drag to PDC with a ferry. They've priced that route perfectly because for most going to CZM, it's not worth saving a few bucks for the hassle of the bag drag or hopping the island hopper.
David McGlamery
Registered
I will never understand airfares...It's unbelievable. Last November (2015) I flow from PHX to CZM for $290 RT. In February (2016) I found an airfare from PHX to CZM for $325. I blinked and it was gone. I watch the airfares to CZM and they had been running about $825 RT PHX to CZM. Two weeks ago I checked again and the airfare was $565. Now I'm going to CZM in August. I rechecked the same flights yesterday and the same RT airfare was $1450. Go figure.
