Airlines Look To Recoup Fuel Costs

Kevin Depew  May 22, 2008 11:02 am

Airlines Look To Recoup Fuel Costs
 
Turning basic expectations of flight into a la carte services.
 

 
Recently air carriers including American (AMR) and US Air (LCC) announced various surcharges to cover the high cost of fuel eating into their operating margins. While this is not exactly a new story - a total of eight airlines have entered Chapter 11 bankruptcy protection or stopped flying altogether since Dec. 2007 - every time the price of a barrel of oil goes up $1, it drives up the expense of jet fuel by $465 million for US-based carriers.

Meanwhile, carriers are now either partnering up, like Delta (DAL) and Northwest (NWA), or rumored to be considering it, like Continental (CAL) and United (UAUA). Expect more fees and surcharges to be coming your way.

Below Minyanville takes a look at what fees you might expect to be paying if fuel costs for air carriers keep rising:

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Comments (7) See All Comments »
05-22-2008, 12:37 pm
You probably mean May 15. http://www.iht.com/articles/reuters/2008/05/16/business/OUKBS-UK-UNITED-TALKS.php

In America one is of course free to refrain from using or purchasing products from anyone they disagree with. That is why I don&
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05-22-2008, 12:41 pm
I might go along with the price gouging idea if they were making money. As I see it, they never have charged enough. The flight costs are too low. Not one carrier has made money in the long run, despite huge gov't supplied infrastructure from
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05-22-2008, 12:53 pm
I agree with what you say Doug. The headline "gouging" is, in fact, misleading. We'll change it to better reflect that. Nonetheless, the bottom line, as you point out, is that airlines have been unable to make money despite massive
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05-22-2008, 5:03 pm
What motive do the airlines have to make a profit? They know they will be bailed out by the government every time. It seems like common sense that in a service industry one would not eliminate the services provided for long-term health of said indust
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05-22-2008, 6:02 pm
I know the popular refrain is that the airlines do not charge as much and so how are they going to keep their head above water. But then again how is it that airlines around the world with similar pricing structures can offer a markedly better produc
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