The collapse of Spirit was unique in that in its death throes it managed to solicit a bailout offer from the U.S. government; but it was not unique among its fellow airlines in going broke. Airlines are a bad business: a really, really bad business. The International Air Transport Association, the trade body of the global airline industry, has documented for years that airlines as a sector destroy investor value in the aggregate. The IATA’s 2026 outlook, looking forward to a quite strong year—this was before the Iran war broke out and oil prices surged—projected an average return on invested capital of 6.8 percent, against a weighted average cost of capital of 8.2 percent. As the IATA’s report said, “the airline industry collectively does not generate earnings that cover its cost of capital.” This has been the case for a long time. From its deregulation in 1978 to the end of 2025, the airline industry has cumulatively lost money: its net profit over those 47 years sits at negative $37 billion.1
Given these grim economics, you won’t be surprised to hear that airlines have a bad habit of going insolvent. This includes many of the most famous names in the history of aviation. Pan Am, long the unofficial flag carrier of the United States, ceased operations in 1991; Eastern Air Lines liquidated the same year; TWA, the carrier of Howard Hughes, was absorbed into American Airlines after a third bankruptcy filing in 2001; Braniff died in 1982. And those are only the most famous names; countless aviation startups have come and gone. (Have you ever heard of Trump Shuttle?) Even airlines with the backing of a national government go bankrupt all the time: Alitalia, Italy’s flag carrier, reported only a single year of profit since its founding in 1946 and was saved countless times by the Italian government before ultimately ceasing operations in 2021. Even those airlines that survive for long periods of time are perpetually in financial distress. Between 1978 and 2005, more than 160 airlines filed for bankruptcy; virtually every major U.S. carrier other than Southwest has been to bankruptcy court at least once. In September 2005, every one of the four largest American airlines—United, Delta, Northwest, and US Airways—was operating simultaneously under Chapter 11 protection.
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One of the central ideas in the study of cooperative games is the idea of the core. The “core” of a game is simply the set of outcomes that no coalition of players can improve upon by breaking away and dealing among themselves. If an outcome is “in the core,” it’s stable, such that nobody can propose a side deal that makes every member of some subgroup better off; if the core is “empty,” then every arrangement is vulnerable to being undercut by some side-coalition, and the market has no resting point, no stable equilibrium. It cycles, destabilizes, and, without outside intervention of some kind, eventually breaks down.
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Suppose you try to run the industry with just two firms. Demand exceeds supply, such that prices are high and there’s plenty of profit to enjoy. But that profit is exactly what invites a third firm to enter, undercut both incumbents, and still cover its costs. Now there are three firms, and supply exceeds demand. Someone has to operate below scale and bleed money on fixed expenses; eventually one of the firms will have to leave the market. Now you’re back to where you started: prices recover, profits climb higher, and the cycle begins again.
So whichever side of the integer you land on—one firm too many, one firm too few—there is some coalition of firms and customers that can profitably reorganize the market against the existing arrangement. In the language of cooperative game theory, the allocation is always vulnerable to defection by some coalition. The core is empty.
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You find the empty-core syndrome, for example, in the railroad industry of the nineteenth century. Building a railroad required vast capital expenditure on track, rolling stock, depots, and bridges; but once the infrastructure was in place, the marginal cost of carrying an additional ton of freight or another passenger across it was almost zero. Two railroads running competing lines between, say, Chicago and New York could not both operate at full cost recovery; so they spent the 1870s and 1880s alternately forming pools and rate-fixing agreements, then watching them collapse into ruinous price wars, going bankrupt, reorganizing, and starting the cycle over again.
And you’ll find the same dynamic in the contemporary airline industry.
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The economics of a genuinely competitive airline industry, then, are really bad—for the same reason the economics of any empty-core industry are bad. And this suggests that, in search of stability, the market participants will eventually try to suppress competition, if only so they can survive.
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In the course of this long path of suffering, every airline has decided, in one way or another, that the competitive airline industry is structurally unprofitable, and not really worth participating in.
One response is to cartelize the industry through means other than direct rate-fixing: to recreate, by private contract, the kind of competition-suppressing arrangements that the CAB previously wrote into statute. The international alliances of which airlines are so fond—Star, SkyTeam, and Oneworld, with their codesharing and antitrust-immunized joint venture agreements—are one form of this: they allow nominally competitive airlines to coordinate scheduling, share revenues, and refrain from undercutting each other on high-value trans-oceanic routes.
The hub-and-spoke model that dominates domestic aviation is another form of this tacit cartelization. By concentrating its operations at a few major airports, an airline can turn those airports into something close to local monopolies. American Airlines, for example, carries about 90 percent of passengers at Charlotte Douglas and 82 percent of passengers at Dallas-Fort Worth, but only about 7 percent of passengers at San Francisco, where the market is dominated by United, and 2 percent at Atlanta International, which is the central hub for Delta. In effect, major domestic airlines have carved up the country into a sort of feudal map of fortress hubs, with each one operating a quasi-monopoly through which it produces the margins that cannot be earned in genuine competition.
But the other response, and perhaps the more interesting one, is to leave the airline business entirely: to treat the planes as a kind of loss-leading distribution channel for what has become the actual product. The main innovation of the airline industry of the last few decades, from this vantage point, has been the frequent flyer program. Invented in the immediate aftermath of deregulation as airlines scrambled for ways to lock in customer loyalty, frequent flyer programs have become something quite different: enormous, free-floating financial businesses, miles-as-currency operations whose value bears essentially no relationship to the cost of the seats backing them.
I remember having a discussion with my dad many years ago about corporations. And we happened to land on airlines. He was complaining about how they've all gone to shit after deregulation, yet...
I remember having a discussion with my dad many years ago about corporations. And we happened to land on airlines. He was complaining about how they've all gone to shit after deregulation, yet still charge so much for airfare.
But before we had that conversation, I stumbled upon stats for the airline industry as a whole. And it was shocking: the whole global airlines industry's profit was like $30billion in the previous year. Which isn't that different today, at about $36billion for 2025. When I brought that up, I think he was in disbelief and just ignored it. But it doesn't really invalidate the modern flying experience, either.
Regardless, there are individual companies in other sectors that make that much, and more, every year.
I likely fly more than the average American. I get it; flying is expensive, and it does feel like you get less and less every year, while the prices go up and up. Things that used to be included are now separate, but yet the base fare has still increased. And it's only gotten more expensive since this dumb war.
I don't feel sorry for the airline industry. I'm not keen on giving them even more money. Though I will because I want/need to travel. But it's not the money printer that people think it is. Maybe some individual airlines have decent margins, but definitely not all.
Idk, good to have perspective I guess. Still sucks to fly.
It does suck to fly. 37 years ago when I started flying regularly for business it wasn't that way. Airline employees were happy, or at least it seemed that way. Airlines published monthly...
It does suck to fly. 37 years ago when I started flying regularly for business it wasn't that way. Airline employees were happy, or at least it seemed that way. Airlines published monthly magazines to read during flights, they took pride in them, and they were actually quite enjoyable to read during a flight. On some flights you could listen to ATC radio traffic on one of the audio channels. Several airlines provide multi-channel audio programming you could listen to by plugging in a headphone at your seat. Meals were abundant on flights and the food was actually good. There were obviously bad days with flight delays and cancellations, but for the most part, it was enjoyable to fly.
Today most every employee seems miserable. Gate agents, who used to seem like they were smart, in charge, and there to help, are now pretty much mindless robots reading prompts from monitors. Amenities on aircraft have been removed one by one over the years; the only thing that is better now is we have the Internet and aircraft Wi-Fi. Pilots have become glorified bus drivers at the mercy of some faceless remotely-located central control. (It may have been that way decades ago, but it wasn't so obvious.). Frequent flyer clubs are overcrowded and now have all the mayhem you used to avoid in the airport outside the clubs. When it comes to airlines and flights I find myself in search of choices that suck the least. I'll be so happy when I retire and don't have to take another flight again.
I'm not sure what you mean here. Being a pilot at a major airline in the US has gotten tremendously better, particularly compared to the late 80s and 90s. Even being a regional or...
Pilots have become glorified bus drivers at the mercy of some faceless remotely-located central control. (It may have been that way decades ago, but it wasn't so obvious.).
I'm not sure what you mean here. Being a pilot at a major airline in the US has gotten tremendously better, particularly compared to the late 80s and 90s. Even being a regional or corporate/charter pilot has improved a lot. It was common in the 90s for a regional pilot to fly 8 legs in a day. Duty time limits hardly existed, which resulted in working a 16 hour day that ended when you set the parking brake with 8 hours "off" that was actually only 5 hours of sleep considering getting off the airplane and ended when you got on the airplane the next day.
Stronger union contracts, despite both 9/11 and the 2008 recession, have resulted in fewer legs per day, and new federal rules made it so pilots need 8 hours of "sleep opportunity" instead of just 8 hours between flights. Pilots were always subject to scheduling from HQ, pilots always talked to air traffic control, and frankly I will take the advanced in technology which make both you and me safer over needing a third person up there who was required because otherwise we couldn't adequately keep track of engine performance or where we actually were.
I mean it was also absurdly expensive 37 years ago. Far beyond the means of most people. These days air travel is extremely affordable - as is often noted, it can often be cheaper than trains,...
I mean it was also absurdly expensive 37 years ago. Far beyond the means of most people. These days air travel is extremely affordable - as is often noted, it can often be cheaper than trains, buses, or car travel, which is pretty remarkable when you think about it. Not just in the us, even in Japan it’s cheaper to fly to Kyushu from Tokyo than it is to Shinkansen. It can sometimes be cheaper to fly to Osaka from Tokyo than take the Shinkansen.
Personally, I’d take the tradeoff of today’s prices vs yesteryears service. I really don’t need a gourmet meal for what is going to be less than 5 hours domestic. I’d rather just get there and eat something nice when I land.
I know the market has spoken*, I just wish the old pricing and service were still an option. As with many, many industries, it’s been remodelled to support an incredibly price conscious consumer...
I know the market has spoken*, I just wish the old pricing and service were still an option. As with many, many industries, it’s been remodelled to support an incredibly price conscious consumer at one end and and an extremely wealthy one at the other, rather than having a “decent price for decent service” option.
From the studies I can see, ticket prices in real terms are around half what they were per mile in the late 80s. I’m fortunate enough that I could and probably would pay double in a lot of scenarios for an all round better experience - not just a comfier chair or a better meal (although I fully would be paying for those too), but an experience that treats the customer and the employee both as people to be respected rather than as inconveniently ambulatory cargo and costs to be eliminated.
But I can’t pay double for that. I can pay 10x as much for business class, or I can pay a wildly varying amount for wildly varying quality in premium economy, but ultimately the standard path sucks and the good path is wildly expensive.
Same goes for a ton of industries: the default option is cheap and horrible for customers and employees alike. If you hint in any way that you’re driven by something beyond just minimising price, that’s a signal that you might be in the “wealthy” bucket and could be convinced to pay for a vastly more expensive boutique service. Decent quality for a fair increase in price simply isn’t an option in a lot of fields, where it used to be the case that it was the only option (which, yes, had its own issues of price floor).
And again, I know, the market has spoken. I still think it sucks, and I still think society as a whole loses out in far greater ways by deferring to the market alone. Maybe the value of good craftsmanship, or stable jobs, or even simply letting people run at less than burnout pace has been lost at a broad societal level in a prisoner’s dilemma of companies undercutting and consumers exercising rational self interest? Maybe we should be looking at ways to push the market into selecting for a more pleasant, more comfortable world for the people who live in it?
*caveats apply about how much markets can truly capture consumer preference when the options are limited to what providers offer and the barriers to compete are incredibly high. But yeah, I’ll accept that there is a genuine trend to cheaper-but-worse winning out.
That basically is what business class is. It's roughly around 2x the cost for domestic flights, maybe 3-4x the cost for international. Definitely not 10x though, unless you're talking about some...
That basically is what business class is. It's roughly around 2x the cost for domestic flights, maybe 3-4x the cost for international. Definitely not 10x though, unless you're talking about some super premium outlandish first class Emirates fare with a psuedo flying hotel room or something.
I’m really not talking about anything crazy like that - I might be looking towards the more pessimistic end there (not intentionally, but I’ll accept I might have rounded it that way), but it’s...
I’m really not talking about anything crazy like that - I might be looking towards the more pessimistic end there (not intentionally, but I’ll accept I might have rounded it that way), but it’s not at all unusual to see £5k - £7k return tickets in business for transatlantic flights (the routes I’m by far the most familiar with, so again acknowledging my own bias there) where economy tickets on the same plane are going to be somewhere in the £450-800 range.
I don’t think I’ve ever actually bought a business class ticket - only ever miles upgrades or work expenses - and if I saw one as low as 3x the economy price on a flight I needed to take I’d really seriously consider it.
That's very doable with the right travel credit cards and reward programs. I've done it, and my only regret was the crying baby in the sleeper cab next to us.
That's very doable with the right travel credit cards and reward programs. I've done it, and my only regret was the crying baby in the sleeper cab next to us.
What would this look like? The reality is that if your prices were 2x everyone else’s but you have nicer seats and the flight attendants smiled at you more you’d get less customers than you would...
And again, I know, the market has spoken. I still think it sucks, and I still think society as a whole loses out in far greater ways by deferring to the market alone.
What would this look like? The reality is that if your prices were 2x everyone else’s but you have nicer seats and the flight attendants smiled at you more you’d get less customers than you would make in ticket costs.
Do you think we should subsidize such businesses with government money? Brainwash people so that the company gets more customers?
In the end the market isn’t some kind of divine force, it’s just the study of human behavior.
I wouldn’t be averse to the government subsidies idea as a test case, at least in a world with better alignment of government to social good. Try it for everything from airlines to ISPs to grocery...
I wouldn’t be averse to the government subsidies idea as a test case, at least in a world with better alignment of government to social good. Try it for everything from airlines to ISPs to grocery stores - but don’t give them any regulatory special treatment, and don’t subsidise existing profit making entities, just do the groundwork for organisations to exist that prioritise quality and service over profit. I’d be fascinated to see what would happen if every major industry had a cost neutral non profit option run in the public interest (it’d be counted as a subsidy because presumably the government would need to provide or underwrite capital investment, and accept the opportunity cost of not maximising return on that). Have the government fund a baseline array of services that compete with everyone on everything - force private companies to survive only if they can actually beat the nonprofit version in terms of what they offer.
That said, I’m already in kind of utopian territory compared to the current political reality. It’d probably need to be a cultural shift, and happen at a level far broader than airlines alone. As you very rightly say, the market isn’t some kind of divine force - but the strongly reinforced political and cultural zeitgeist has become to treat it like one. This succeeded in the market? It’s better. That failed in the market? It’s worse.
Success in the market solely means “convinced more people to pay for your product”. Maybe that’s because it’s a better product, or a better value despite being a worse product. Or maybe it’s advertising. Maybe it’s chemical addiction. Maybe it’s regulatory capture. Maybe it’s monopolistic behaviour, or a cartel. Maybe it’s externalising the costs and making them society’s problem.
A market is the study of human behaviour, and like any study it sets parameters on that behaviour, sets targets, shapes the very thing it’s studying. If you show that profit is the only criterion that matters, you get paperclip maximisers that increase profit incredibly well without regard to any other outcomes or externalities.
As a rough, very rough, back of the envelope idea, I’d suggest looking at an economic policy that still makes heavy use of market economics - markets are tools that do provably work for efficiently finding successful equilibria, after all - but couples it with a clear and intentional use of targeted interventions (regulations, taxation, direct state run competition) for the overall maximisation of net population happiness, comfort, and wellbeing. “This will hurt company profits” shouldn’t be an argument against a sensible intervention, it should be an acknowledgment that the companies involved were briefly allowed to gain from harmful behaviour but the loophole is now justifiably being closed.
And finally, to be clear: I know it’s not that simple. Government run entities are a conflict of interest when it comes to legislative special treatment. Regulation is subject to regulatory capture. Powerful and pervasive government intervention is susceptible to incompetent or malicious government. I’m not saying any of this is easy, maybe not even plausible. I’m certainly not saying one guy musing on the internet has the perfect answer. But I am saying we should be thinking and talking along these lines to see if there are ways to refine the practical details, rather than accepting the premise that market success is a sufficiently good proxy for what we actually want to encourage in the world.
What is the social good in this case? As a taxpayer there’s a lot of other things I’d rather subsidize before we get to “make middle class plane riders feel better about themselves”. If anything,...
I wouldn’t be averse to the government subsidies idea as a test case, at least in a world with better alignment of government to social good.
What is the social good in this case? As a taxpayer there’s a lot of other things I’d rather subsidize before we get to “make middle class plane riders feel better about themselves”. If anything, I’d rather subsidize the low end of flight.
It’s the low income people that need to see their families, or are traveling from a area with no jobs to a place that needs workers, that has more of a social good than “I feel like plane attendants don’t respect me anymore”.
There’s certainly many areas where there can be market intervention. Anything with a positive or negative externality, for instance. Education is a classic example, where the net benefit to society is higher than the market benefit.
But “plane tickets should be more expensive” is not one of those areas lmao. Already almost all of the major carriers run at a net loss anyway, they only make a profit due to reward programs and selling miles to credit card companies.
I deliberately didn’t address the “flight attendants should smile at me more” point in your first reply because I thought it was unnecessarily snarky, but since you’re doubling down on that side...
I deliberately didn’t address the “flight attendants should smile at me more” point in your first reply because I thought it was unnecessarily snarky, but since you’re doubling down on that side of the question: I care about them being treated with respect as employees, as a valuable and integral part of a company rather than a costly resource to be bled dry. I care about customers being treated as people who are purchasing something in good faith and morally deserve to be provided a service in the spirit of that transaction, rather than as adversaries to be misled on pricing up to and slightly beyond the limits of the law, tied in paperwork to strip what legal rights do exist, and thrown into a kafkaesque nightmare of inaccessible and conflicting “support” when anything goes wrong. And I care about this as a pattern I see in effectively every industry, not remotely just airlines.
What is the social good in this case?
Maybe I wasn’t as clear as I tried to be, but I was taking this as a jumping off point for my thoughts on the erosion of the customer/service provider social contract in general, through the lens of airlines because it was the jumping off point that brought it to mind and I do think it makes for a good and relatable microcosm of the broader problem.
It’s why I was talking about craftsmanship, about ISPs and grocery stores and baseline economic competition in general, about holistic economic policy and its overlap with culture.
The social good is the rebalancing of the things we prioritise, to acknowledge that private profit is not the optimal goal, and should be treated as an imperfect proxy for actual contribution to the world.
In short: it was a train of thought, one that meandered beyond the relatively small station it began at. I think it’s fair to say there’s quite a bit more nuance in my replies than “plane tickets should be more expensive”, even if you do end up disagreeing with my broader underlying point.
That seems like complete apples and oranges as to what the original topic was on? Which was that these days, planes have seats with a small amount of legroom and give you some peanuts and call it...
I care about customers being treated as people who are purchasing something in good faith and morally deserve to be provided a service in the spirit of that transaction, rather than as adversaries to be misled on pricing up to and slightly beyond the limits of the law, tied in paperwork to strip what legal rights do exist, and thrown into a kafkaesque nightmare of inaccessible and conflicting “support” when anything goes wrong.
That seems like complete apples and oranges as to what the original topic was on? Which was that these days, planes have seats with a small amount of legroom and give you some peanuts and call it a day, rather than serve you steak like in the regulation days.
I think having consumer protection laws to stop false advertisement and giving people the run around when flights get cancelled. And we do have those laws, in the US and elsewhere. Could we have more? Sure.
But the small legroom and peanuts should stay - that’s better for society. That’s a completely different issue. Trying to gentrify air travel again is not to the betterment of society, rather, the opposite.
I read @agentsquirrel’s points about pride in one’s work, employee happiness, and agents having, well, agency and ability and desire to achieve an outcome for the customer as the main thrust of...
I read @agentsquirrel’s points about pride in one’s work, employee happiness, and agents having, well, agency and ability and desire to achieve an outcome for the customer as the main thrust of the conversation. That’s where I was coming from, but I can see that with a focus on different parts of that first reply, it reads differently.
The backdrop to the “37 year ago experience” is that it was pre-deregulation. It would be the equivalent of if we had a law that stated that all hotels in the US must cost $1000/night. Of course,...
The backdrop to the “37 year ago experience” is that it was pre-deregulation. It would be the equivalent of if we had a law that stated that all hotels in the US must cost $1000/night.
Of course, if you have to cost exactly $1000/night, which is a pretty high sum, the main leverage point for airlines was to be even more luxurious than your competitors. With OP presumably having his enormous airfare covered by work, yeah, it would be a sick deal for them. It’s a terrible deal for 99.999% of the population.
There’s also a lot of assertions that I don’t think are backed up in reality. Pilots are treated far better today. I’m not even sure what “glorified bus drivers” is supposed to mean. The pilot makes sure you get from A to B safely. They are paid handsomely (large aircraft pilots can get to 7 figures with overtime). There is a lot of rules to make sure they don’t work too much and kill everyone.
Flight attendants are fine? It’s not, luxury hotel butler good. But I’ve been on 6 flights in the last month and the attendants have all been professional and courteous. They seem to care and take pride in their work.
What is overworked is ATC but they’re not customer facing to begin with.
They didn’t even mention things like customer support.
Yeah the comments on flight attendants and pilots seem extremely out of touch to me and rooted in a concerning mentality that cares more about the appearance of comfort on planes than on the...
Yeah the comments on flight attendants and pilots seem extremely out of touch to me and rooted in a concerning mentality that cares more about the appearance of comfort on planes than on the actual material conditions these employees work in (and based on other comments pointing out that they have objectively improved for pilots since the 90s, I don't have much trust in the original comment's attempts to tie this to their complaints about service quality, which I agree with you has been extremely pleasant and adequate at minimum on every flight I've taken)
...i flew often from the seventies through the turn of the millenium but since september 2001, i've quit flying unless absolutely unavoidable, as i loathe the twenty-first-century american air...
...i flew often from the seventies through the turn of the millenium but since september 2001, i've quit flying unless absolutely unavoidable, as i loathe the twenty-first-century american air travel experience...
...last time i flew to east asia, though, i was struck by how remarkably similar their airlines felt to peak-era western air travel; it was an unexpectedly refreshing turn of experience only spoiled when transferring to an american carrier on the return leg home...i expect a deeper analysis of economic and cultural cause-and-effect may present interesting correlations and hypothetical models for how airlines might operate more or less successfully as a private or public good...
But they don't charge so much for airfare. Airfare is massively cheaper now versus before deregulation. That's basically the entire reason it sucks now. Airlines used to compete on service and...
He was complaining about how they've all gone to shit after deregulation, yet still charge so much for airfare.
But they don't charge so much for airfare. Airfare is massively cheaper now versus before deregulation. That's basically the entire reason it sucks now.
Airlines used to compete on service and comfort, because they weren't allowed to compete on the one thing customers actually care about; price. Now they compete on price, and pretty much price alone. As a result, flying sucks now. It is however, far cheaper than it was in the 70s.
Do many people think it's profitable? Granted I live in a smaller isolated country where air travel is really the only way to/from it, and visiting family in different cities is usually much more...
But it's not the money printer that people think it is.
Do many people think it's profitable? Granted I live in a smaller isolated country where air travel is really the only way to/from it, and visiting family in different cities is usually much more convenient via flying, so it's not uncommon to hear news about how unprofitable our flag carrier is.
To use something from the article, we really only have enough demand for 1.8 airlines (or so). It has been pretty stable for a decade with the flag carrier being decent and often propped up by the government (and that's when it's most often in the news), and a budget airline still isn't all that budget (and is also foreign owned and operated). There are also a couple of teensy tiny airlines that run incredibly small planes on very few routes that aren't served by the other two, but they can't be making money from it.
Sounds a bit like Air New Zealand. It's our primary regional transport provider since we don't have passenger trains. Jetstar competes on some of the main domestic routes as a more budget option.
Sounds a bit like Air New Zealand.
It's our primary regional transport provider since we don't have passenger trains.
Jetstar competes on some of the main domestic routes as a more budget option.
I assumed it was Air NZ as well. I was down there for two weeks and it seemed like hopping on a domestic flight with a backpack was very very common. Jetstar looked incredibly frustrating if you...
I assumed it was Air NZ as well. I was down there for two weeks and it seemed like hopping on a domestic flight with a backpack was very very common.
Jetstar looked incredibly frustrating if you didn't read the fine print. I think like two thirds of the people I saw weighing their bags at the gate blew past the 7kg limit and had to pay to check bags.
Because it is :) To be honest, I don't know how many other places will be in a similar situation to NZ with our country being long and, as you noted, not having good rail connections. That's not...
Sounds a bit like Air New Zealand.
Because it is :)
To be honest, I don't know how many other places will be in a similar situation to NZ with our country being long and, as you noted, not having good rail connections. That's not even including the fact that we have a body of water between the larger two islands, and building a bridge between them is not feasible thanks to high and variable wind and strong currents.
And you're saying that the Naked bus doesn't travel from Auckland to Te Anau? What's the story there? I heard that if you ride in the nude it's totally free. That true?
And you're saying that the Naked bus doesn't travel from Auckland to Te Anau?
What's the story there? I heard that if you ride in the nude it's totally free. That true?
From the article:
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I remember having a discussion with my dad many years ago about corporations. And we happened to land on airlines. He was complaining about how they've all gone to shit after deregulation, yet still charge so much for airfare.
But before we had that conversation, I stumbled upon stats for the airline industry as a whole. And it was shocking: the whole global airlines industry's profit was like $30billion in the previous year. Which isn't that different today, at about $36billion for 2025. When I brought that up, I think he was in disbelief and just ignored it. But it doesn't really invalidate the modern flying experience, either.
Regardless, there are individual companies in other sectors that make that much, and more, every year.
I likely fly more than the average American. I get it; flying is expensive, and it does feel like you get less and less every year, while the prices go up and up. Things that used to be included are now separate, but yet the base fare has still increased. And it's only gotten more expensive since this dumb war.
I don't feel sorry for the airline industry. I'm not keen on giving them even more money. Though I will because I want/need to travel. But it's not the money printer that people think it is. Maybe some individual airlines have decent margins, but definitely not all.
Idk, good to have perspective I guess. Still sucks to fly.
It does suck to fly. 37 years ago when I started flying regularly for business it wasn't that way. Airline employees were happy, or at least it seemed that way. Airlines published monthly magazines to read during flights, they took pride in them, and they were actually quite enjoyable to read during a flight. On some flights you could listen to ATC radio traffic on one of the audio channels. Several airlines provide multi-channel audio programming you could listen to by plugging in a headphone at your seat. Meals were abundant on flights and the food was actually good. There were obviously bad days with flight delays and cancellations, but for the most part, it was enjoyable to fly.
Today most every employee seems miserable. Gate agents, who used to seem like they were smart, in charge, and there to help, are now pretty much mindless robots reading prompts from monitors. Amenities on aircraft have been removed one by one over the years; the only thing that is better now is we have the Internet and aircraft Wi-Fi. Pilots have become glorified bus drivers at the mercy of some faceless remotely-located central control. (It may have been that way decades ago, but it wasn't so obvious.). Frequent flyer clubs are overcrowded and now have all the mayhem you used to avoid in the airport outside the clubs. When it comes to airlines and flights I find myself in search of choices that suck the least. I'll be so happy when I retire and don't have to take another flight again.
I'm not sure what you mean here. Being a pilot at a major airline in the US has gotten tremendously better, particularly compared to the late 80s and 90s. Even being a regional or corporate/charter pilot has improved a lot. It was common in the 90s for a regional pilot to fly 8 legs in a day. Duty time limits hardly existed, which resulted in working a 16 hour day that ended when you set the parking brake with 8 hours "off" that was actually only 5 hours of sleep considering getting off the airplane and ended when you got on the airplane the next day.
Stronger union contracts, despite both 9/11 and the 2008 recession, have resulted in fewer legs per day, and new federal rules made it so pilots need 8 hours of "sleep opportunity" instead of just 8 hours between flights. Pilots were always subject to scheduling from HQ, pilots always talked to air traffic control, and frankly I will take the advanced in technology which make both you and me safer over needing a third person up there who was required because otherwise we couldn't adequately keep track of engine performance or where we actually were.
I mean it was also absurdly expensive 37 years ago. Far beyond the means of most people. These days air travel is extremely affordable - as is often noted, it can often be cheaper than trains, buses, or car travel, which is pretty remarkable when you think about it. Not just in the us, even in Japan it’s cheaper to fly to Kyushu from Tokyo than it is to Shinkansen. It can sometimes be cheaper to fly to Osaka from Tokyo than take the Shinkansen.
Personally, I’d take the tradeoff of today’s prices vs yesteryears service. I really don’t need a gourmet meal for what is going to be less than 5 hours domestic. I’d rather just get there and eat something nice when I land.
I know the market has spoken*, I just wish the old pricing and service were still an option. As with many, many industries, it’s been remodelled to support an incredibly price conscious consumer at one end and and an extremely wealthy one at the other, rather than having a “decent price for decent service” option.
From the studies I can see, ticket prices in real terms are around half what they were per mile in the late 80s. I’m fortunate enough that I could and probably would pay double in a lot of scenarios for an all round better experience - not just a comfier chair or a better meal (although I fully would be paying for those too), but an experience that treats the customer and the employee both as people to be respected rather than as inconveniently ambulatory cargo and costs to be eliminated.
But I can’t pay double for that. I can pay 10x as much for business class, or I can pay a wildly varying amount for wildly varying quality in premium economy, but ultimately the standard path sucks and the good path is wildly expensive.
Same goes for a ton of industries: the default option is cheap and horrible for customers and employees alike. If you hint in any way that you’re driven by something beyond just minimising price, that’s a signal that you might be in the “wealthy” bucket and could be convinced to pay for a vastly more expensive boutique service. Decent quality for a fair increase in price simply isn’t an option in a lot of fields, where it used to be the case that it was the only option (which, yes, had its own issues of price floor).
And again, I know, the market has spoken. I still think it sucks, and I still think society as a whole loses out in far greater ways by deferring to the market alone. Maybe the value of good craftsmanship, or stable jobs, or even simply letting people run at less than burnout pace has been lost at a broad societal level in a prisoner’s dilemma of companies undercutting and consumers exercising rational self interest? Maybe we should be looking at ways to push the market into selecting for a more pleasant, more comfortable world for the people who live in it?
*caveats apply about how much markets can truly capture consumer preference when the options are limited to what providers offer and the barriers to compete are incredibly high. But yeah, I’ll accept that there is a genuine trend to cheaper-but-worse winning out.
That basically is what business class is. It's roughly around 2x the cost for domestic flights, maybe 3-4x the cost for international. Definitely not 10x though, unless you're talking about some super premium outlandish first class Emirates fare with a psuedo flying hotel room or something.
I’m really not talking about anything crazy like that - I might be looking towards the more pessimistic end there (not intentionally, but I’ll accept I might have rounded it that way), but it’s not at all unusual to see £5k - £7k return tickets in business for transatlantic flights (the routes I’m by far the most familiar with, so again acknowledging my own bias there) where economy tickets on the same plane are going to be somewhere in the £450-800 range.
I don’t think I’ve ever actually bought a business class ticket - only ever miles upgrades or work expenses - and if I saw one as low as 3x the economy price on a flight I needed to take I’d really seriously consider it.
That's very doable with the right travel credit cards and reward programs. I've done it, and my only regret was the crying baby in the sleeper cab next to us.
What would this look like? The reality is that if your prices were 2x everyone else’s but you have nicer seats and the flight attendants smiled at you more you’d get less customers than you would make in ticket costs.
Do you think we should subsidize such businesses with government money? Brainwash people so that the company gets more customers?
In the end the market isn’t some kind of divine force, it’s just the study of human behavior.
I wouldn’t be averse to the government subsidies idea as a test case, at least in a world with better alignment of government to social good. Try it for everything from airlines to ISPs to grocery stores - but don’t give them any regulatory special treatment, and don’t subsidise existing profit making entities, just do the groundwork for organisations to exist that prioritise quality and service over profit. I’d be fascinated to see what would happen if every major industry had a cost neutral non profit option run in the public interest (it’d be counted as a subsidy because presumably the government would need to provide or underwrite capital investment, and accept the opportunity cost of not maximising return on that). Have the government fund a baseline array of services that compete with everyone on everything - force private companies to survive only if they can actually beat the nonprofit version in terms of what they offer.
That said, I’m already in kind of utopian territory compared to the current political reality. It’d probably need to be a cultural shift, and happen at a level far broader than airlines alone. As you very rightly say, the market isn’t some kind of divine force - but the strongly reinforced political and cultural zeitgeist has become to treat it like one. This succeeded in the market? It’s better. That failed in the market? It’s worse.
Success in the market solely means “convinced more people to pay for your product”. Maybe that’s because it’s a better product, or a better value despite being a worse product. Or maybe it’s advertising. Maybe it’s chemical addiction. Maybe it’s regulatory capture. Maybe it’s monopolistic behaviour, or a cartel. Maybe it’s externalising the costs and making them society’s problem.
A market is the study of human behaviour, and like any study it sets parameters on that behaviour, sets targets, shapes the very thing it’s studying. If you show that profit is the only criterion that matters, you get paperclip maximisers that increase profit incredibly well without regard to any other outcomes or externalities.
As a rough, very rough, back of the envelope idea, I’d suggest looking at an economic policy that still makes heavy use of market economics - markets are tools that do provably work for efficiently finding successful equilibria, after all - but couples it with a clear and intentional use of targeted interventions (regulations, taxation, direct state run competition) for the overall maximisation of net population happiness, comfort, and wellbeing. “This will hurt company profits” shouldn’t be an argument against a sensible intervention, it should be an acknowledgment that the companies involved were briefly allowed to gain from harmful behaviour but the loophole is now justifiably being closed.
And finally, to be clear: I know it’s not that simple. Government run entities are a conflict of interest when it comes to legislative special treatment. Regulation is subject to regulatory capture. Powerful and pervasive government intervention is susceptible to incompetent or malicious government. I’m not saying any of this is easy, maybe not even plausible. I’m certainly not saying one guy musing on the internet has the perfect answer. But I am saying we should be thinking and talking along these lines to see if there are ways to refine the practical details, rather than accepting the premise that market success is a sufficiently good proxy for what we actually want to encourage in the world.
What is the social good in this case? As a taxpayer there’s a lot of other things I’d rather subsidize before we get to “make middle class plane riders feel better about themselves”. If anything, I’d rather subsidize the low end of flight.
It’s the low income people that need to see their families, or are traveling from a area with no jobs to a place that needs workers, that has more of a social good than “I feel like plane attendants don’t respect me anymore”.
There’s certainly many areas where there can be market intervention. Anything with a positive or negative externality, for instance. Education is a classic example, where the net benefit to society is higher than the market benefit.
But “plane tickets should be more expensive” is not one of those areas lmao. Already almost all of the major carriers run at a net loss anyway, they only make a profit due to reward programs and selling miles to credit card companies.
I deliberately didn’t address the “flight attendants should smile at me more” point in your first reply because I thought it was unnecessarily snarky, but since you’re doubling down on that side of the question: I care about them being treated with respect as employees, as a valuable and integral part of a company rather than a costly resource to be bled dry. I care about customers being treated as people who are purchasing something in good faith and morally deserve to be provided a service in the spirit of that transaction, rather than as adversaries to be misled on pricing up to and slightly beyond the limits of the law, tied in paperwork to strip what legal rights do exist, and thrown into a kafkaesque nightmare of inaccessible and conflicting “support” when anything goes wrong. And I care about this as a pattern I see in effectively every industry, not remotely just airlines.
Maybe I wasn’t as clear as I tried to be, but I was taking this as a jumping off point for my thoughts on the erosion of the customer/service provider social contract in general, through the lens of airlines because it was the jumping off point that brought it to mind and I do think it makes for a good and relatable microcosm of the broader problem.
It’s why I was talking about craftsmanship, about ISPs and grocery stores and baseline economic competition in general, about holistic economic policy and its overlap with culture.
The social good is the rebalancing of the things we prioritise, to acknowledge that private profit is not the optimal goal, and should be treated as an imperfect proxy for actual contribution to the world.
In short: it was a train of thought, one that meandered beyond the relatively small station it began at. I think it’s fair to say there’s quite a bit more nuance in my replies than “plane tickets should be more expensive”, even if you do end up disagreeing with my broader underlying point.
That seems like complete apples and oranges as to what the original topic was on? Which was that these days, planes have seats with a small amount of legroom and give you some peanuts and call it a day, rather than serve you steak like in the regulation days.
I think having consumer protection laws to stop false advertisement and giving people the run around when flights get cancelled. And we do have those laws, in the US and elsewhere. Could we have more? Sure.
But the small legroom and peanuts should stay - that’s better for society. That’s a completely different issue. Trying to gentrify air travel again is not to the betterment of society, rather, the opposite.
I read @agentsquirrel’s points about pride in one’s work, employee happiness, and agents having, well, agency and ability and desire to achieve an outcome for the customer as the main thrust of the conversation. That’s where I was coming from, but I can see that with a focus on different parts of that first reply, it reads differently.
The backdrop to the “37 year ago experience” is that it was pre-deregulation. It would be the equivalent of if we had a law that stated that all hotels in the US must cost $1000/night.
Of course, if you have to cost exactly $1000/night, which is a pretty high sum, the main leverage point for airlines was to be even more luxurious than your competitors. With OP presumably having his enormous airfare covered by work, yeah, it would be a sick deal for them. It’s a terrible deal for 99.999% of the population.
There’s also a lot of assertions that I don’t think are backed up in reality. Pilots are treated far better today. I’m not even sure what “glorified bus drivers” is supposed to mean. The pilot makes sure you get from A to B safely. They are paid handsomely (large aircraft pilots can get to 7 figures with overtime). There is a lot of rules to make sure they don’t work too much and kill everyone.
Flight attendants are fine? It’s not, luxury hotel butler good. But I’ve been on 6 flights in the last month and the attendants have all been professional and courteous. They seem to care and take pride in their work.
What is overworked is ATC but they’re not customer facing to begin with.
They didn’t even mention things like customer support.
Yeah the comments on flight attendants and pilots seem extremely out of touch to me and rooted in a concerning mentality that cares more about the appearance of comfort on planes than on the actual material conditions these employees work in (and based on other comments pointing out that they have objectively improved for pilots since the 90s, I don't have much trust in the original comment's attempts to tie this to their complaints about service quality, which I agree with you has been extremely pleasant and adequate at minimum on every flight I've taken)
...i flew often from the seventies through the turn of the millenium but since september 2001, i've quit flying unless absolutely unavoidable, as i loathe the twenty-first-century american air travel experience...
...last time i flew to east asia, though, i was struck by how remarkably similar their airlines felt to peak-era western air travel; it was an unexpectedly refreshing turn of experience only spoiled when transferring to an american carrier on the return leg home...i expect a deeper analysis of economic and cultural cause-and-effect may present interesting correlations and hypothetical models for how airlines might operate more or less successfully as a private or public good...
Those weird tube headphones and dim movie screens were the worst.
But they don't charge so much for airfare. Airfare is massively cheaper now versus before deregulation. That's basically the entire reason it sucks now.
Airlines used to compete on service and comfort, because they weren't allowed to compete on the one thing customers actually care about; price. Now they compete on price, and pretty much price alone. As a result, flying sucks now. It is however, far cheaper than it was in the 70s.
And paying more for nice seats is still an option! Most people choose cheaper fares over comfy chairs...
Do many people think it's profitable? Granted I live in a smaller isolated country where air travel is really the only way to/from it, and visiting family in different cities is usually much more convenient via flying, so it's not uncommon to hear news about how unprofitable our flag carrier is.
To use something from the article, we really only have enough demand for 1.8 airlines (or so). It has been pretty stable for a decade with the flag carrier being decent and often propped up by the government (and that's when it's most often in the news), and a budget airline still isn't all that budget (and is also foreign owned and operated). There are also a couple of teensy tiny airlines that run incredibly small planes on very few routes that aren't served by the other two, but they can't be making money from it.
There's an old joke, which I think is apt:
Sounds a bit like Air New Zealand.
It's our primary regional transport provider since we don't have passenger trains.
Jetstar competes on some of the main domestic routes as a more budget option.
I assumed it was Air NZ as well. I was down there for two weeks and it seemed like hopping on a domestic flight with a backpack was very very common.
Jetstar looked incredibly frustrating if you didn't read the fine print. I think like two thirds of the people I saw weighing their bags at the gate blew past the 7kg limit and had to pay to check bags.
Because it is :)
To be honest, I don't know how many other places will be in a similar situation to NZ with our country being long and, as you noted, not having good rail connections. That's not even including the fact that we have a body of water between the larger two islands, and building a bridge between them is not feasible thanks to high and variable wind and strong currents.
And you're saying that the Naked bus doesn't travel from Auckland to Te Anau?
What's the story there? I heard that if you ride in the nude it's totally free. That true?
What a bizarre company name.
https://en.wikipedia.org/wiki/Nakedbus.com
I found kiwi businesses to have all sorts of weird names, and many of them had been around forever.
When you're the only game in town. . .