derryl

Are Airlines Going Bankrupt Again?

As a number of commenters have observed above, demand for airline tickets is extremely price elastic. Unless airfares are relatively cheap people simply look at the few hundred dollar pricetag and decide to drive or choose a closer destination where flying is not necessary. At least 50%, probably much more, of air travel is nonessential, a 'luxury', and luxuries are the first items cut from deflating household budgets.

One commenter wants to reregulate and subsidize airfares. Why should 100% of taxpayers subsidize a luxury like air travel for the maybe 10% of taxpayers who regularly use it? This is just another example of the wealthier and more profligate sucking money out of the less wealthy and more prudent. Unless you are Dumbo the flying elephant, or the flying nun, or a witch on her broom, flying across continents and over oceans is NOT a 'right', and certainly not an activity that taxpayers should be subsidizing.

In the 1960s only rich 'jet-setters' flew around this planet. I'm not making an argument for elitism, but air travel is a high cost service that naturally belongs in the category of luxury consumption that few can afford. If and when oil prices return to peak oil levels the airline industry faces massive contraction and will once again become a playground for rich people and for 'once in a lifetime' middle class extravagance.