Airline deregulation has failed to benefit many consumers, says Georgia travel agency owner Lawton Roberts, and it has certainly not benefited travel agents. To publicize his views, Roberts is using the Web site for Uniglobe Country Place Travel (www.countryplace.com, 770-338-1184).
Roberts’ manifesto (www.countryplace.com/amok.htm) lists eight ways in which the major airlines take advantage of consumers. I’d call six of the eight relatively trivial:
– Too much overbooking (a problem the airlines solve by luring travelers off overbooked planes with vouchers for future travel).
– Nonrefundable air fares (a nuisance, but one that permits big lines to sell tickets cheaply).
– The $50 fee to trade in the dollar value of a nonrefundable ticket toward a second ticket (another nuisance, but better than no exchange at all).
– Requirements for travelers to buy low-fare tickets as soon as they reserve (designed to get travelers to bypass agencies and buy direct from airlines).
– Constant fare changes (so?).
– Failure of some low-fare lines and the big lines to agree to through-ticketing and through-baggage checking (a situation as much the fault of low-fare lines as of the big ones).
Roberts’ seventh point, I think, is both valid and important: “Consumers are lured by the frequent-flier programs of major airlines, only to discover that in many cases the airlines can’t deliver on free tickets.” Solving that particular problem, however, doesn’t require full reregulation.
But the core of Roberts’ manifesto is in his eighth charge–that there’s “little or no competition in major airline hub cities,” allowing average fares to and from those cities to be far higher than fares on more competitive routes. In fact, I’d say the problem is bigger yet: Even on routes where two or more big airlines compete, many consumers are denied the full low-fare benefits of deregulation unless there’s also competition from at least one low-fare line.
The consumers who suffer most from big-line pricing are those who decide to travel on short notice and those who can’t stay at their destination over a Saturday night.
Granted, leisure travelers benefit from the ability of big airlines to squeeze top dollar out of business travelers. If everyone paid the same price, most leisure travelers would wind up paying a lot more than they do now. Unfortunately, restrictions the airlines apply to prevent business travelers from using low fares also prevent many leisure travelers from using them as well.
Roberts isn’t the only voice calling for reregulation, or at least some form of government-mandated relief from monopoly pricing. Consumer advocate Don Pevsner says the government should enforce a reasonable maximum level for unrestricted fares–an action, he says, that would not require throwing out the other benefits of deregulation.
I continue to maintain the marketplace is the proper arena for remedies. And competition from low-fare lines has provided an adequate remedy to major-line oligopoly on many routes.
Right now, I don’t sense much public or political pressure for airline reregulation. But such pressure could easily develop if the big airlines continue to gouge so many of their customers. Agree? Keep an eye on Roberts’ Web site.
