EU airlines gamble on no-frills pricing
 

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Copyright © 2002 The International Herald Tribune | www.iht.com

EU airlines gamble on no-frills pricing
Edward Wong The New York Times
Monday, August 12, 2002



LONDON The ads in the Underground are as subtle as the barking of a sideshow huckster. "You won't believe your eyes," they scream.

Then come the prices: the equivalent of $107 round-trip to Paris, $154 to Marseille, $201 to Lisbon.

Those tickets on British Airways do not have to be bought in advance, do not require a Saturday night stay - and are as much as 80 percent below comparable fares offered two months ago. On most of the carrier's domestic and European flights, a traveler can walk up to the counter and buy a discounted ticket until seats at those prices sell out.

MORE..................

All this is, is a publicity stunt trying to get people back on traditional airlines. Fact is that seats advertised are not readily available and are still more expensive than seats on no frills airlines.

All the traditional airlines can't just become low cost because they slash fares and scrap the food, cost control is nowhere near enough to operate profitably offering these prices. Neither do they have the required economies of scale required to operate profitably.

As they say, time will tell...

How strange. Recently I tried to book a flight to Dublin, checking the fares from several regional airports in the UK. In every case I found Aer Lingus (traditional carrier) to be cheaper than Ryanair (low cost). In fact, no matter which day I travelled (looking a month in advance) I couldn't find a cheaper fare on any of the low cost carriers. So Aer Lingus it was, and i got a free beer on board! Its all well and good saying that the low cost carriers get rich on low fares, but they don't. They make their cash on the middle to high fares they get from pasengers suckered in by promises of (extremely limited) low fares and aggressive (and inaccurate according to the UK ASA) advertising.

You might have found cheaper offers there but Ryanair operates a price guarantee policy refunding twice the difference in fare.

The number of seats offered cheaply by traditional airlines is nowhere near the same as the quantity offered by low fares airlines.

FlyingIrishman:

I remember reading the small print of the Ryanair price guarantee a few months ago and wondering whether they *ever* paid out, so restrictive were its terms.

I've just gone to their website to look for the wording but can't manage to find any reference to price guarantees. It doesn't seem to be a major part of their offer any more. Can you point me at it?

Below are some fares for travel to Dublin from 4 southern airports dep sat 31/08 and ret wed 04/09.

BA Southampton £148.20
Air Lingus Gatwick £95.10
BA Heathrow £85.10
Ryanair Bournemouth £68.68
Ryanair Gatwick £49.68

The cheapest available fare was chosen on all routes.

consider yourselves lucky...
 

Looking at some of the Canadian "low-fare" airlines, prices of $50 within Ontario look tasty, until you see $55 of charges. Yikes! 9/11 Surcharges, Airport "Improvement", GST etc...

Is it that Canadians are
(a) getting ripped off or
(b) paying the true cost of flying?

LHR-DUB is EI operated and code shared with BA. The fares do differ even on code share. EI may have been cheaper.

Also what times are you looking at? Quoting fares need to same or roughly the same departure time.

As I already have stated I quoted the cheapest available fare on that route for the dates stated. The majority of these flights were mid afternoon. All prices quoted are from the airlines own websites.

Perhaps it is germane to remark that Ryanair operates at a profit whilst Aer Lingus is losing money.

Since Ryanair's price guarantee probably only applies on routes it operates and since most other carriers don't operate on those routes I would imagine that Ryanair doesn't have to pay out very often, if ever.


This 'my airlines cheaper than your airline' really is nonsense. Most of the time people should say, "I shopped around and got the best deal on the day for the circumstances and I don't care who the flight's with.".

If the best deal is Aer Lingus then thats great.

The price guarantee applies to all designated airports of a particular city. For example, if you find a flight from STN to Stockholm-Arlanda cheaper than a Ryanair flight to Stockholm-Skavsta then this qualifies for the price guarantee if the departure and arrival times are within 2 hours of those of the FR flight.

Why then wasn't I offered this for STN SNN when i found way cheaper on EI/BA for the same dates and roughly the same time? It took 7 weeks, yes SEVEN, for the no reply to come through. As with everything FR, it is arbitary. Flying Irishman- NOONE ELSE OPERATES INTO STOCKHOLM (ANY AIRPORT) FROM STANSTED EXCEPT FR...NICE BUSINESS PLAN FOR THE REFUNDS.

St Crispin -

I think FI's point is that this guarantee would apply to all the airports at the London end too, i.e. you should be able to compare the Ryanair STN-Skavsta fare with BA/SK from Heathrow to Arlanda.

That said, I do agree with you about the difficulty of getting refunds, and assume that FR has de-emphasised this "guarantee" since it's no longer a key selling point.

A related refund issue is the PSC which is collected in respect of each departing passenger. If you don't fly, the airline doesn't have to pay the PSC - I recall managing on one occasion to get a refund from Ryanair afterwards (with several letters) but they have now changed their wording to make it clear that all money paid, including passenger charges, is non-refundable. A nice deal, this:
contribution to FR fixed costs if you fly
=ticket price - pax-variable costs
ditto if you no-show = ticket price + PSCs and taxes

Now this may be the same for other airlines, but IMHO the argument is rocky: "don't blame us for these taxes and charges, they're nothing to do with us, we have to pay them to the greedy airports," followed by, "you didn't use your ticket? OK, so we don't have to pay the taxes and charges to the airport for you now, but of course you can't have the money back - it's ours."

The competitions authority in the Uk were very hot on BA for the above PSC charges and they now make a point of refunding it if nothing else of the ticket is recoupable..then again if you don't recognise the air users association or show disregard for the above authority what hope for the passenger?