Unfortunately, airlines want to make a profit, too

One thing I’ll say about consumer advocate Chris Elliott: He’s persistent. This morning, he posted an article on fortune.com chastising the airlines for “piling on the perks” for their best customers at the expense of their customers in economy class. He’s quite right about one thing: first class, particularly in international products, is getting better, as airlines are forced to compete with the likes of Etihad. He notes the Porsches that pick you up airside, first class lounges, first class terminals, etc. for the 1%ers. All true. I think the large US carriers are fighting a losing battle as they fight to keep the three big middle-east carriers (ME3) out of the US, but as businesses, they are doing what every other business would do. As usual, there are a few hints at the bottom of the post on how to beat some of these business practices.

Where he loses me is that the carriers are doing this at the expense of economy passengers. I know some of it is clickbait, but apparently, I bit:

 

More fees in the back, more freebies in the front. The rich get richer. And the rest? Well, they don’t call it “economy” class for nothing.

 

No, I don’t like the idea of the new Slimline seats or continued degradation of amenities, but to say that this is happening because airlines are sticking it to economy passengers is simply an example of the Post hoc ergo propter hoc fallacy. The airlines have much more base motives: profits. Although we’ve come to think of airlines as a public utility, they have shareholders who demand returns, in the same way that McDonald’s, IBM and Pfizer do. The airlines implemented bag fees when oil prices went up several years ago and discovered that the bag fees would stick, even when oil prices came down. Do I like it? Of course not. Do airlines of things that border on slimy? Well, check out their policies on the fees that you have to pay when you make a ticket change versus their “responsibilities” when they decide to change the time of your flight. Like many other corporations, US airlines are doing exactly what they need to (or can do, as the case may be) to be competitive financially.

I’m not arguing that airlines are warm and fuzzy companies, but it’s important to have a consistent sense of “fairness.” If I stay at a hotel, I don’t expect to get the same treatment in the least expensive room that I would get in the Presidential Suite. My basic computer won’t have the same bells and whistles that a high-end one would. Etc.

We’ve gotten used to free bags, food, etc. on airlines because that’s the way that it had always been, particularly prior to deregulation (I can distinctly remember the taste of the sponge cake that they used to serve on the tray as dessert. I wish I couldn’t.). But airlines could only fly certain routes and prices were much higher on an inflation-adjusted basis. And if there’s any question that the consumer likes cheap vs. good, look at the success of low-cost carriers like Southwest, or even ultra-low-cost carriers like Spirit, versus the success (or lack thereof) of all-business class carriers. Remember Eos or Maxjet? Didn’t think so. Even Midwest Airlines eliminated the chocolate chip cookie. And that’s precisely the point: there is a difference in value between the first and economy class products, and airlines do what they can to maximize profits.

Fortunately, there are less expensive ways to get some comfort without buying a ticket outright.

  • The major network carriers all offer ways to upgrade domestically using miles, with or without a small co-pay. Internationally, you can do so with more miles and a larger co-pay, but the product is that much nicer. Delta has changed the “cost” of the upgrade since that post was written to a more complicated structure. One-way upgrades are generally in the 15-20K range, with co-pays generally around $75, plus or minus. United even waives the co-pay for elite members. In other words, you can upgrade from Boston to Los Angeles, for instance, for $75 and 15,000 miles on American. That’s a bargain. Note that a few of the transcon flights out of New York have a different structure.
  • Delta allows you to “buy up” your ticket using miles, valued at a penny each. For instance, if the cost of your economy ticket is $300 and you could buy that same flight in first class for $600, you can pay 30,000 miles ($300 at a penny per mile) and upgrade to first. Even better: The ticket will earn you miles as if you bought it outright, at least on the cash portion.
  • And, of course, you can buy the ticket with miles. This is the area where I find the airlines to be most disingenuous. They do a great job of advertising free flights, but not such a great job of offering inexpensive ones. It’s getting harder to find flights at the “saver” or “standard” level, since the airlines have created so much artificial currency. Still, there’s no reason to horde miles if you want to go somewhere. They certainly don’t earn interest and always devalue over time.

And if you’re not happy in economy (And why would you be?), check out Louis C.K.’s take on flying. It starts at about 2:00.

 

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