As of midnight last night, part of the FAA shut down due to fun politics. Part of the shutdown was not having the ability to renew FAA taxes on airline ticket sales. Some airlines are taking advantage of this and offering lower fares, others are using this as a chance to earn a little extra dough.
It makes sense for airlines to go both directions. One is really just your classic sale promotion and using the timing of the taxes. For the others, I would assume that most consumers do not understand that there are no taxes and are not aware that even though the taxes are removed, most airlines have just raised fares to compensate.
UPDATE 1: I have confirmed that Spirit Airlines is passing the savings on to customers. I have heard rumors that Frontier is as well, but waiting to confirm.
UPDATE 2: Hawaiian Airlines is also sharing the love with customers.
UPDATE 3 (7/24 2pm PDT): Frontier Airlines is also sharing the love. American and JetBlue have raised their fares.
UPDATE 4 (7/25 7:45am PDT): It looks like some airlines might have had a change of heart. Working to confirm, but appears that Virgin America and Frontier might have stopped passing on their savings and have raised fares. For now I am changing Virgin America and Frontier to “unknown.” Also checking in with Alaska, Spirit and Hawaiian to see their thoughts.
UPDATE 5 (7/25 8:55am PDT): Spirit Airlines has confirmed they are still offering lower fares. Virgin America has raised some of their fares, but not all of them.
Currently, only a few airlines are passing the FAA tax savings to customers.
I am trying to talk directly to US airlines through out the day and will be updating. I am hearing somethings from reliable sources, others are more like rumors and I am being sure to indicate each:
ALASKA AIRLINES- Sharing the Love
Alaska Airlines is advertising on their main page that they are having cheaper prices due to no FAA taxes. A spokesperson with Alaska explained via email, “We’re not raising fares. We’ll continue to pass the savings on to customers.”
SPIRIT AIRLINES- Sharing the Love
I have confirmed directly with Spirit that they are passing down the savings and have no plans to stop.
As of 6:30pm PST on 7/24 there is no information about their “Spirit Airlines is Giving Customers Their Share of $200 Million Per Week in Tax Savings!” deal on their webpage, but an email was sent out to their VIP customers (thanks John B for sharing). In the email they state, “Spirit has become a model for transparency, ensuring customers are not impacted by hidden fees as practiced by other airlines and the government.”
HAWAIIAN AIRLINES- Sharing the Love
Hawaiian Airlines is promoting saving money via the FAA Taxes on Twitter: “Some major federal taxes on airline tickets have taken the weekend off. BOOK NOW.”
VIRGIN AMERICA- Sharing Some of the Love
Over the weekend, Virgin America ran a special “Evade Taxes. Take Flight,” campaign, but now the website is changed. As of 10:40pm last night they were advertising fares with lower federal taxes. As of Monday morning, they have raised some of their fares. “Yes, we were automatically passing on the equivalent discount (down to the decimal) across the board through the weekend ’“ and encouraging guests to grab the discount early,” Abby Lunardini with Virgin America Communications explained over email. But, given the dynamic nature of fares, with the Monday morning fare load ’“ some fares have changed and/or moved up, but some of the discounts have held.”
FRONTIER AIRLINES- Unknown
As of Monday morning I am hearing rumors that Frontier has raised their prices. Emails, calls and messages sent via Twitter have not yet been returned to confirm.
DELTA AIR LINES- Keeping the Money
It seemed earlier in the day that Delta was going to share the love, but it has been decided to raise fares.
SOUTHWEST AND AIRTRAN- Keeping the Money
“Southwest and AirTran implemented a system wide fare increase of $4 each-way to help offset industry cost pressures ’“ such as the rising expense of fuel,” Brad Hawkins with Southwest Communications explained over email. “Our current ticket prices will remain the same (Customers will not see an increase in fares), as the 7.5% excise tax will not be collected. These decisions were made in light of the recent industry change in aviation tax collections, and we made a business decisions to remain competitive in these economically challenging times.”
UNITED AIRLINES- Keeping the Money
United has decided to match the taxes and have increased fares.
AMERICAN AIRLINES- Keeping the Money
According to the LA Times, American Airlines and JetBlue have raised their fares and are keeping the extra FAA tax money. “So in effect the taxes are not being collected, but the price paid by the customer remains the same,” American’s Tim Smith told the LA Times.
JETBLUE- Keeping the Money
JetBlue has decided to raise fairs and a spokesperson told AirlineReporter.com, “We’re working with the Federal Government to determine how the recent expiration of the Federal Excise Tax, and other taxes, will impact our operation. We have participated in an industry-wide fare increase in order to remain competitive.”
The livery on this Jet2holidays Boeing 737-800 (G-GDFD) looks mighty similar to Allegiant Air's livery.
If it looks like a duck, quacks like a duck, then it has to be a duck right? Not always. The image above is for a Jet2holidays Boeing 737, but that livery looks mighty familiar doesn’t it? It seems to have a lot in common with Allegiant Air’s livery, but for good reason.
Allegiant Air has leased two of their Boeing 757s (current registered as G-LSAL and G-LSAM) to Jet2holidays and they are flying them with a modified Allegiant livery. It appears they have now painted their 737 in a similar, but not exact same livery — which has become their new livery.
It is not bad looking, but I think Allegiant’s looks better. It does give you an idea what Allegiant’s livery would look like on a Boeing 737.
I tried to emails Jet2holidays to get some more information on the livery update, but to date, I have not received a reply.
Image: Ben Allsup
Allegiant Air Boeing 757-200 (N902NV) while in Las Vegas. Yes, this livery looks even better in person -- one of the best on a 757 in my opinion.
Allegiant Air has gained approval from the Federal Aviation Administration (FAA) to start operating the Boeing 757-200. Today the 757 (N902NV) will start service between McAllen-Miller International Airport (MFE) and Las Vegas (LAS). You might have to be a true airline nerd to appreciate an airline starting to use a new aircraft type. I have enjoyed following Allegiant Air’s acquisition of Boeing 757s, see the re-painting, to seeing one in the buff getting its interior installed at Paine Field.
Currently, Allegiant flies a fleet of 51 MD-80 aircraft and this is the first time they have added another aircraft type. The airline owns a total of three Boeing 757s, but two of them are being leased with other airlines until mid-2012. Allegiant also plans to purchase two additional Boeing 757s that will enter service during the first quarter of 2012.
’œThis is an important day for Allegiant,’ Andrew C. Levy, Allegiant Travel Company President, said. ’œThe addition of the Boeing 757-200 will play an important role in our company’s future growth. Our operations team worked long and hard to ensure the completion of this certification and we thank them for their dedication in achieving this important goal.’
Allegiant was hoping to start flying to Hawaii, but the FAA required them to get experience operating the Boeing 757 over land before earning Extended-range Twin-engine Operational Performance Standards 180 (ETOPS), which is required to fly to Hawaii.
It is unlikely that the Boeing 757, configured with 217 economy seats, will remain on the MFE to LAS route, since the airline is hoping to initiate service to Hawaii, Mexico and Canada via Las Vegas and Orlando. The city and airport are pretty excited about the Boeing 757 that they made a video highlighting the new aircraft coming to the airport on YouTube.
Video found via Airliners.net
Delta Air Lines Boeing 767-300ER.
There is no question that Delta Air Lines made a lot of money off bag fees last year — $952 million to be exact. While many other airlines made a load of money with bag fees as well, Delta gets the majority of the attention since they made the most. Some attention has been in late night routines (okay, Conan’s bit is hilarious, if not fully accurate) and others have been negative news articles. It seems odd that so many companies are getting pats on the back for making profit out of the bad economy, but airlines end up being punished, like they are somehow earning their money illegally.
Dan Webb, on his blog Things in the Sky, shows that although Delta made more in bag fees than other airlines, that doesn’t mean it is a large percentage of their revenue. His post has a very handy chart that shows that Delta’s bag fees are only 3% of their overall operating revenue. When looking at all major US airlines, Delta is actually 9th in the percentage of bag fees to total operational revenue with ultra low cost carriers Spirit and Allegiant at the top the list with 10.5% and 8.7% respectfully.
There are a lot stories out there hating on the bag fees, but one of my favorites is from Boston’s NCEN.com titled Fuming over Bag Fees. It is a classic story talking to passengers who are up in arms for the airlines not being “honest” with them and hiding these bag fees. Even for people that do not travel often, it is pretty difficult not to know about bag fees. For those that do not, every airline I have ever flown makes it quite clear when booking your ticket, if there will be additional fees for luggage so one can plan accordingly. Passengers in NCEN’s story act like airlines are literally opening their wallets and stealing their money. The author, Peter Howe, states that airlines are “addicted” to fees like they are some nasty habit that should be kicked. Since when does a business not like a new idea that makes them money and allows them to survive? Without bag fees, you can be certain that not as many airlines would be able to survive, there would be less competition and airfares would be higher overall.
Airlines are not charities — they are businesses looking to make profit. Airlines had this idea to charge passengers for bag fees, obviously many passengers pay this fee and airlines are able to make a profit. Why would an airline get rid of these fees? Customers have the ability to vote on these fees with their pocket book. Southwest Airlines and JetBlue both don’t charge you for checking a bag (on Southwest, you can check two for free), but of course, they are not always the cheapest option, even when checking a bag.
All that being said, yes I know that they are annoying when you are checking in and you have to drop another $50.00 for two bags. I do whatever I can to avoid paying bag fees myself and cringe when I end up having to pay them.I wish airlines would do a better job explaining why they are charging the fees. It seems like most airlines are like “we are charging them, take it or leave it approach.” I do not think most customers realize that weight costs money and instead of selling it as, “if you have a checked bag, you will owe more,” sell it as, “if you do not have a checked bag, we now let you save money.”
I believe that ala cart pricing will be the future of airlines. Many other businesses operate this way and why should I have to pay for something that I don’t want to use. When I book a hotel room, I might cringe when I have to pay $25 for parking and $20 for Wi-Fi and $5 for a bottle of water, but it is understandable. Why should parking be built into my hotel price if I do not have a car?
Image: Thomas Becker
Allegiant's Boeing 757 N902NV at Paine Field.
If you read the blog, you know I have a nice little fascination with Allegiant getting Boeing 757s. From the first announcement, to getting some of the first photos the Boeing 757 in Allegiant livery, to photos of the 757s in the new, new livery and their ETOPS delay.
Dan Webb on his blog, Things in the Sky, has a great update on Allegiant’s 757s. It looks like Allegiant will be pushing back additional purchases of used Boeing 757s and leasing others. They will only be flying one domestically to gain the experience to get ETOPS certified to fly to Hawaii. Allegiant tells me they will be flying N902NV which is currently housed at ATS at Paine Field.