The airlines that are stockpiling capacity at our expense will come hat in hand for a bailout at our expense.
Airlines flying empty planes to keep flight slots during coronavirus outbreak
101–110 of 364 posts
Re: Airlines flying empty planes to keep flight slots during coronavirus outbreak
#102Earlier quoted context omitted.
Because on the flip side, airlines could keep canceling flights on less popular routes when they're not at full capacity (i.e. not/less profitable). That would inconvenience passengers. Under this regulation they could lose that route to a competitor that is more willing to service customers (or can operate at a lower cost). EDIT: I found the EU page outlining the regulation here: https://ec.europa.eu/transport/modes…
Mandating flights seems like a bad solution to carriers canceling flights unilaterally. Why not just force them to provide comparable alternate arrangements and/or pay the passengers financial compensation?
The flights aren't mandated, the airlines can not fly them if they want. But if they don't they may lose them to another airline willing to fly them. If nobody wants to fly the route, then there's no threat of losing it to a competitor.
Re: Airlines flying empty planes to keep flight slots during coronavirus outbreak
#103Earlier quoted context omitted.
I find it interesting your word choice suggests that the price war is undesirable compared to a destabilizing monopoly.
I mean, what do you expect happens after airlines die from a price war? It’s not lower prices.
Generally speaking, I'd hope it wouldn't be "Everything consolidates without bound."
Doing that just sets the stage for a monopoly to form, just add time. The price war should be won by the airline that can most efficiently manage resources and adapt different business models to provide stable service with fewer inputs. That is what the Market is purportedly for, no?
Consolidation is not good. High variety distributes society's eggs across many baskets, creating fault tolerance. Consolidation leaves us one black Swan away from a potentially unrecoverable calamity.
Re: Airlines flying empty planes to keep flight slots during coronavirus outbreak
#104The airlines that are stockpiling capacity at our expense will come hat in hand for a bailout at our expense.
Except there won’t be money available when they ask for it. When the dollar collapses after the Fed cuts rates, the interest rate will rise very high. The government will be forced to cut spending, and there will be no bailouts this time.
Re: Airlines flying empty planes to keep flight slots during coronavirus outbreak
#105Earlier quoted context omitted.
Because otherwise airlines can buy up all the slots so competitors can't operate.
But it's ok with you that they buy up all the slots so competitors can't operate... just so as long as they burn fuel while they do it?
If they buy up all of the slots and then fly them, customers can take the flights. The goal isn't to (necessarily) to ensure that competitors can operate, it's to ensure that passengers have flights they can travel on.
Re: Airlines flying empty planes to keep flight slots during coronavirus outbreak
#106The airlines that are stockpiling capacity at our expense will come hat in hand for a bailout at our expense.
Except there won’t be money available when they ask for it. When the dollar collapses after the Fed cuts rates, the interest rate will rise very high. The government will be forced to cut spending, and there will be no bailouts this time.
zerohedge.com is leaking again
Re: Airlines flying empty planes to keep flight slots during coronavirus outbreak
#107Earlier quoted context omitted.
As I’ve answered elsewhere: burning fuel (and sustaining other operating costs) while they squat on slots ultimately ensures that squatting on too grand a scale and/or for too long will result in bankruptcy and thus ensures that the system is self-correcting (by limiting incumbent advantage).
If you just give fines to companies that don't run flights on routes then you can impose a penalty without incentivising empty or near-empty flights.
If the fine is larger than the price of the fuel then they'll just fly the flights.
Re: Airlines flying empty planes to keep flight slots during coronavirus outbreak
#108Ironic. I had heard tales of the old Soviet Union about trains running empty to fill distance quotas. It was presented as the ultimate proof of how messed up their system was.
Re: Airlines flying empty planes to keep flight slots during coronavirus outbreak
#109Honestly, how can we ever beat climate change if this is the norm.
Re: Airlines flying empty planes to keep flight slots during coronavirus outbreak
#110Earlier quoted context omitted.
Because (as is argued elsewhere in this thread), large airlines could buy up all slots and then not operate flights on them, starving their would-be competitors of opportunity to create a basis for themselves.
But they could just do the same with the current ruling - the only difference would be whether they spend their money on more expensive slots or on wasting fuel.
No. There are multiple levels of regulation.
Internationally the rule is that you can have "slots" if your airport is busy enough. IATA classifies airports into three levels with only the busiest class 3 "Co-ordinated" airports having slots. A relatively small number of generally very globally important airports qualify, very few of them in the US - but of course these seem notable because you've heard of them. My local airport (which is a ghost town because the airline that ran most flights from there recently collapsed) does not have slots. If you had told them last year you wanted to take off and land six planes a day there they'd just say that sounds great, let us know when to expect them and where to send the bills. London Heathrow on the other hand obviously doesn't have capacity to just have you show up with six extra planes and not cause chaos.
But, the international rule doesn't say how you get slots. IATA organises conferences to discuss strategy, but it's completely legal for, say, Russia to decide that all slots in its major airports are for Russian companies. The EU has its own regulations which say if you're a EU member state with an airport that gets slots, you must meet certain EU criteria that aim to create a competitive marketplace, keep unsafe carriers out of European airspace and make everything efficient.
The UK implements those regulations through a private company because of course it does the Tories (party presently in government) love private companies, and that's what Airport Coordination Limited is for.
Anyway, the EU level regulation means you can't "just" buy more slots, you need to qualify to even be allowed them. If Big Airline A buys Small Airline B, it would not be unusual for the rules to say that too bad, the resulting company still named Big Airline A doesn't get all the resulting slots, some of them must be auctioned off to competitors.