Competition between airlines both domestic and foreign is high in today's economy. Some people believe that the rampantly increasing prices of aviation can be reduced, but can they?
According to Molly Martin, the airline industry is the most heavily taxed industry in the United States today. Today their are almost 20 taxes imposed on airline travel that will increase the price of your ticket a very significant amount, sometimes being that the taxes will actually supersede the price of your ticket. According to an article by USA Today, a certain Jet Blue flight from Boston to New York is just over 100 dollars, and another from Boston to London on Virgin Atlantic is actually less than 100 dollars, but the taxes for these flight add up to over 600 dollars, three times the amount of the actual airfare. Would the general public find this appalling? Most would agree that yes they would, but if all of these taxes were removed for more affordable airfare to the average American, what would the deficit that would be caused mean for the U.S? What the average public does not realize is that part of these taxes are going towards the so called "aviation infrastructure". This includes things such as the GPS system, ground based navaids, air traffic control, airport maintenance and so on.
To give a better idea on how much the "aviation infrastructure" costs, we can examine the cost of upkeep on the VORs around the country. According to Flyingmag.com, upkeep and maintenance of all the thousands of VORs across the country cost over $110,000,000 per year. This is where some of those taxes come in to play. The average American does not understand the outstanding cost of aviation as a whole, and all of the different aspects that cost money.
So, what can be done about the high cost of airline travel? Well, this is difficult to answer, however their are a few ideas that I have. First, I believe that foreign air travel to the U.S. should heavily taxed. If foreign air carriers are making money off of flying to our country, why shouldn't we make money off of them flying to our country? Secondly, I believe that people should travel more. How would this possibly help you may ask? It is simple, the more business that operators receive, the more money they make, which in turn could lead to lower ticket prices. I personally believe that these are a few solid ideas that could help the airline industry. If the price of aviation and airline travel is reduced, more and more people will begin to utilize it more frequently and therefor creating new jobs and assuring job security for those current.
I am one who believes that although airline travel and aviation as a whole is expensive, it is a necessity in the world today and I am a firm supporter of the advancement and upkeep of the industry.
In the near future, we won't have to rely on the upkeep and maintenance of VORs due to GPS and WAAS capability. I like your ideas to lower the cost of airline travel; however, I wonder what percentage of the population will not travel because they're afraid to fly?
ReplyDeleteAirline travel and aviation is definitely expensive and necessary. I feel the same way about the necessity of the infrastructure. I wonder if the prices would really go down if air travel increased. Almost every commercial flight I've been on in the last few years is completely full. It seems like efficiency has picked up, and companies are finding ways to fill flights. The profit margin still seems very low even when a flight is full. Maybe the airlines should just raise their rates and stop trying to be the lowest price around.
ReplyDeleteIt is a good point about the VORs. Why do we spend $110 million on that?
ReplyDeleteI struggled to follow the discussion in certain parts. That said, it is challenging times for sure. Yes, the loads on flights are high, yet the airlines struggle to turn a profit. Thoughts? I entertain that this is a result of high and unpredictable fuel cost in addition to the taxes that are needed for infrastructure maintenance. This gives little room for profits. But if all airlines raised prices, who customers give in and pay the higher prices?
ReplyDeleteInteresting point about the dollar amount associated with keeping the current VORs serviced. Did not know that it was that much a year!
ReplyDeleteDo you think that the $110 million we spend on the up keep of VORs will be spent elsewhere? What I am trying to say is will we really be saving all of that money or just finding another place to blow it?
ReplyDeleteIt would help if people just traveled more like you said above but in these times can the general public really afford to just travel more? Unfortunate as it is, I don't think something like this will actually fix all the cost problems as a whole.
ReplyDeleteI think they could definitely find better use for that $110 million dollars!
ReplyDelete