BiggnightsAirline Business
August 18th 2008 20:55
What's going on in the airline business now that the price of oil has started to fall? Some analysts think that the current price marks a point where airlines will start to see operating profits.
But the consensus appears to be that airlines will continue to raise prices, add fees, charge for services such as meals and checked bags, and cut capacity (ie, fewer flights overall). See the CNN Money link for this side of the industry.
What will you do regarding travel plans and the changing airline industry? I've found that for short trips (up to about 400 miles) it may actually be faster and cheaper to drive than to fly.
William Greene, airline analyst for Morgan Stanley, believes that the recent downturn in oil prices is the "tipping point" that will save the airline industry. He said a continued plunge in oil prices could return the industry to profitability by 2009.
"The recent oil price move, if sustained, is a game-changing event for the industry," said Greene, in an analyst note published on Aug. 11. On Friday, oil prices were trading below $113 a barrel.
(CNN Money)"The recent oil price move, if sustained, is a game-changing event for the industry," said Greene, in an analyst note published on Aug. 11. On Friday, oil prices were trading below $113 a barrel.
But the consensus appears to be that airlines will continue to raise prices, add fees, charge for services such as meals and checked bags, and cut capacity (ie, fewer flights overall). See the CNN Money link for this side of the industry.
What will you do regarding travel plans and the changing airline industry? I've found that for short trips (up to about 400 miles) it may actually be faster and cheaper to drive than to fly.
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