Why Airlines Are Not Raising Prices

Have you heard about all the complaining from airlines lately? They are getting killed by fuel prices. They are pushing pilots to run on less fuel. Yet they are not really raising ticket prices much. Some are charging more for luggage. Some are charging more for various amenities that used to be free along with higher ticket prices.

So why all the whining and not raising prices? Your local gas station raises its prices. Your grocery store raises prices.

Our baseless hunch is that the airlines are looking down the road. They are looking to go bankrupt so they can get more breaks from government and have leveraging power in salary negotiations. Why would anyone run a business this way to lose this much money and intend to stay running? We can hear it now, "How can any union of pilots or air cabin staff complain about wages when the airlines are struggling so much?"

We want people to fly and to travel. It's our business. But it can cost more. Instead we have pilots running on less fuel to circle the airport or divert if a problem arises. We'd rather pay a bit more, have less crowded skies and be safer. Doing some comparisons to routes we took in 1994 and we found that tickets are cheaper today. Considering inflation and fuel prices that are up about 400% since then, they should be a bit higher.

What do you think?