Airlines ponder how far they can push travelers

[AlisterC]

MSN News Article

With oil now over $130 a barrel (this time last year it wss $65, in 1999 in was $10) airlines are in trouble. American Airlines is now charging for the FIRST checked in luggage bag. So no luggage is included in the ticket price (except carry-on). Many smaller airlines, especially in the US, are drastically cutting flights and even major airlines are now cutting jobs.

Some interesting quotes:

QUOTE

"This is worse than 9-11," said Ray Neidl, an analyst with Calyon Securities. After the 2001 terror attacks, "at least you knew passengers were coming back. Oil at $130 is unsolvable."[/quote]

QUOTE

Herb Kelleher, the iconic co-founder of Southwest Airlines who stepped down as chairman Wednesday, said flying could become something that only business travelers or the affluent can afford, much as it was in the 1950s and '60s.

"You may see a lot less air service across the United States, and that's really a shame," Kelleher said. "We are heading back in that direction."

Passengers are wondering how long they can afford to fly.[/quote]

Obviously the article is aimed at the US. But this is obviously a world wide problem. With oil running out (demand has exceeded supply for the last 18mnths) its bad news for aircraft because you can't run a jetliner on batteries.

s0cks

 

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[Peppermint]

Bad news indeed. The thing that gets on my nerve, is so many of these big companies are sitting on their asses moaning about the price of oil, why don't they all band together and come up with a good alternative? Heck, I've even thought of a couple of ideas how we could get cars using 90% less petrol or none at all (Although with my limited knowledge, no idea how it would all go together).

[Alex]

I suppose things will have to become unbearably uncomfortable before people start getting together and putting something else in place...

Sort of interesting what will happen, as the world is an oil-based economy (think of where your common house-hold items come from, were made, how they got to you...).

Alex

[greaneyr]

We're not 'running out of oil'. This is the key thing to remember. We just have more people wanting to buy oil than the oil-producers can churn out (well at least, that's what they say, but I can understand why it might be in their best interests to say that). However, if we assume that it's true then consider this: According to a report produced by the Ministry of Economic Development, roughly half of NZ's oil consumption is used to power motor vehicles. So, if we could eliminate that (and if all the world could) then the demand for oil would drop lower than the supply and air travel wouldn't be as affected. In other words, alternative fuels used in motor vehicles will affect the demand for oil and influence the affordability of air travel.

We're never going to 'run out' of oil. What we need to be doing is working to reduce the demand for it in areas where fossil fuels can easily be replaced by renewables. Air travel will eventually need to start using something else besides fossil fuels, but not right now if we can reduce what we're doing with the rest of the world's oil. Here in NZ we can get around 75-80% of our power from renewables, whereas other countries are much more reliant on fossil fuels. A LOT can be done to reduce the world's oil consumption.

People often paint 'worst case scenarios' about fuel usage, but that is basing everything on the world's oil consumption as it is today. Remember, as prices rise, demand will drop, and every act that reduces demand is a good thing.

[AlisterC]

Unfortunately the USA is close to recession, so people with money are at the moment investing money in commodities, like Oil and Gold, and probably rice for all I know. Hence the price of these things is going up. No use investing in property or the share market in the US at the moment.. Plus as has been mentioned, countries like China are consuming more and more, and in a few years will consume more than the US :S

[Ian Warren]

Were getting closer to the days of sail , gone the fast steamers like Titanic ... Cough cough :poo: , the speedy 'Queen Mary' , the larger 'Queen Elizabeth' .. the Stainless steel hulled 'United States' .. .. Its time ! VOTE FOR Monty Burns , Yes Its ... Time for Nuclear Power ! , the safest energy source around ... Lucky the USA our friends the Americans tried it in a B-36 why not now , ok few complaint's if had a slight mishap , we can all Glow from here