Delta fares

Nikita

Newbie
Sep 25, 2002
3
0
Hello,
today I saw an online Delta fare of $182 from LaGuardia to Orlando for summer 2003. Do you think the fares will go lower after the new year? I''m new to traveling and don''t know the trends in air fares and such. Any advice would be appreciated.
Nikita
 

Diesel8

Senior
Aug 19, 2002
290
0
www.usaviation.com
The fare might go down a few dollars, but $182 is about as low as one could expect, provided this is roundtrip.

Unless Delta decides to have a firesale, I think that it's a great price!
 

PLANES333

Member
Aug 19, 2002
66
0
www.usaviation.com
The price may or may not go down. It all dpends on the market next summer. If Jetblue or Spirit decide to offer $69 fares, then DL will be forced to fight the fare war with them. Also keep in mind that $183 is not a bad price for a ticket, especially if it includes all of the taxes, security fees, segment fees and fuel surcharges if any. My advise for you would be to buy a ticket with DL Express from JFK to MCO, as this would allow you to change the ticket a bit easier if you needed to. DLX only has a $50 change fee and it is easier to get a simialr fare, so you won't be paying large fare difference charge. Delta Mainline charges $100 to change tickets and it is more difficult to get a similar fare as DL mainline has a much more complex fare structure. If the price does go down for you flights you can always get a credit for the difference.

Good Luck
 

KCFlyer

Veteran
Aug 20, 2002
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Just remember that it's non refundable, non transferable, if you fail to use it, you lose it, and any changes will be subject to a $100 change fee.
 

Busdrvr

Veteran
Aug 20, 2002
2,217
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[blockquote]
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On 9/25/2002 4:32:07 PM DalMD88 wrote:

Sounds like a steal. Compare Greyhound@ $250, Amtrak@ $277 or your own car at about $150 in gas. We are giving that fare away @ $183.
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[/blockquote]

And the government SUBSIDIZES AMTRAK and doesn't tax Greyhound tickets.
 

KCFlyer

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Aug 20, 2002
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Busdriver - If your employer sold me a ticket that cost a total of $200 (all taxes included), and the government eliminated the taxes that represent 25% of that amount, would they sell me the ticket for $150 or would the fare stay at $200?
 

Busdrvr

Veteran
Aug 20, 2002
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[blockquote]
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On 9/26/2002 7:15:02 AM KCFlyer wrote:

Busdriver - If your employer sold me a ticket that cost a total of $200 (all taxes included), and the government eliminated the taxes that represent 25% of that amount, would they sell me the ticket for $150 or would the fare stay at $200?
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[/blockquote]

My employer would likely charge 175 or some other price that would stimulate demand enough to meet supply, while at the same time allow us to make a profit, ie WIN-WIN. What do you think is a fair fare on that route?
 

KCFlyer

Veteran
Aug 20, 2002
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[P]
[BLOCKQUOTE][BR]----------------[BR]On 9/26/2002 7:54:19 AM Busdrvr wrote:
[P][/P][BR]My employer would likely charge 175 or some other price that would stimulate demand enough to meet supply, while at the same time allow us to make a profit, ie WIN-WIN.  What do you think is a fair fare on that route?
[P][/P]----------------[/BLOCKQUOTE]
[P]Hmmm...well, I thought that $200 was a pretty decent fare. My point is, that the argument that the government needs to eliminate the taxes is not valid, since the customer is paying the bulk of those taxes, and IMHO, your airline would be the exception by offering a lower fare if the taxes were not included. After all, in all the newspaper ads, the fare that is advertised doesn't include all the added taxes, PFC's and security charges. I'd think that most airlines would raise the advertised fare to the same level that it would have been with all the taxes added in...especially after all the consumer unfriendly announcements about use it or lose it and $100 change fees. [/P]
 

DLFlyer31

Senior
Aug 20, 2002
444
0
[blockquote]
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On 9/26/2002 9:28:27 AM KCFlyer wrote:
Hmmm...well, I thought that $200 was a pretty decent fare. My point is, that the argument that the government needs to eliminate the taxes is not valid, since the customer is paying the bulk of those taxes, and IMHO, your airline would be the exception by offering a lower fare if the taxes were not included. After all, in all the newspaper ads, the fare that is advertised doesn't include all the added taxes, PFC's and security charges. I'd think that most airlines would raise the advertised fare to the same level that it would have been with all the taxes added in...especially after all the consumer unfriendly announcements about use it or lose it and $100 change fees. [/P]
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[/blockquote]

In a direct sense, you are right the consumer pays the tax. However, the underlying economics indicate that the airlines also pay the tax...just not directly. Here's an example:

Lets say we live in HappyLand, where there are no taxes. Now, I own an airline and charge $100 to fly from NNN to XXX (a popular destination ) . With this incredibly low fare, I attract 100 customers daily so my total revenue is $10,000.

Now, one day HappyLand is invaded by Socialists who take over the gov't. They decide to impose a tax of 50% on all airline tickets. Without changing my fares, I now must charge passengers $150 and of course give $50 of that to the gov't. Unfortunately, the higher fare scares away some pax who decide to drive, take a train, teleconference,etc. So now, only 90 passengers fly my airline daily and my total revenue is only $9,000.

In the direct sense, the 90 passengers who still fly my airline are paying the tax 90x50=$4500. However, in the economic sense, I am paying part of the taxes in terms of lost revenues due to fewer passengers.

The argument I am making is extremely simplistic and leaves out much of the economic theory. There is far more to it in terms of who bears the burden of taxation...the consumer or the producer?

As for what would happen if out gov't removed taxes? Economic theory would say that prices would fall, but not by as much as the tax. This is the argument that Busdrvr is putting forward with his win-win situation. The exact amount of the fall would depend upon the incidence of taxation and demand elasticity.

Now, economic reality might be different from economic theory. Fares are already extremely low and planes are relatively full so the airlines don't necessarily want more customers paying even lower fares. They might keep fares where they are and just reap the full benefit of the tax cut....i.e. no consumer benefit. This is the situation you seem to expect, KCFlyer and I would tend to think you are right....though the low-fare airlines could conceivably throw a wrench in the whole plan.
 

whlinder

Veteran
Aug 20, 2002
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What is the fare basis on that?

There are cheaper fares out there but are for travel between now and the end of the year. Deltaflot's CEO keep telling us how revenue isn't coming back; if it is really the case they'll have a sale for next summer. imho
 

longonsofty

Member
Aug 28, 2002
16
0
Busdrvr, you ignorant slut.

To be fair, the airlines get subsidies too. I see it in A bin of every flight through my station. It's mail. Also, when KCFlyer is going from say MCI-BNA on gov't bidness he'll pay X, a fare that has been bid on by any airline that wants to. (That's my understanding of it, it may not be 100% accurate. Hell, it might not be 50% accurate, but that's my understanding of it.) But, at least at WN, they'll bid a price where they can make some $ on it.
 

KCFlyer

Veteran
Aug 20, 2002
10,697
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[P]
[BLOCKQUOTE]
[P][BR]----------------[BR]On 9/26/2002 11:02:03 AM DLFlyer31 wrote:[/P]
[P][BR]In a direct sense, you are right the consumer pays the tax.  However, the underlying economics indicate that the airlines also pay the tax...just not directly.  Here's an example:[BR][BR]Lets say we live in HappyLand, where there are no taxes.  Now, I own an airline and charge $100 to fly from NNN to XXX (a popular destination ) .  With this incredibly low fare, I attract 100 customers daily so my total revenue is $10,000.  [BR][BR]Now, one day HappyLand is invaded by Socialists who take over the gov't.  They decide to impose a tax of 50% on all airline tickets.  Without changing my fares, I now must charge passengers $150 and of course give $50 of that to the gov't.  Unfortunately, the higher fare scares away some pax who decide to drive, take a train, teleconference,etc.  So now, only 90 passengers fly my airline daily and my total revenue is only $9,000. [BR][BR]In the direct sense, the 90 passengers who still fly my airline are paying the tax 90x50=$4500.  However, in the economic sense, I am paying part of the taxes in terms of lost revenues due to fewer passengers.  [BR][BR]The argument I am making is extremely simplistic and leaves out much of the economic theory.  There is far more to it in terms of who bears the burden of taxation...the consumer or the producer?  [BR][BR]As for what would happen if out gov't removed taxes?  Economic theory would say that prices would fall, but not by as much as the tax.  This is the argument that Busdrvr is putting forward with his win-win situation.  The exact amount of the fall would depend upon the incidence of taxation and demand elasticity.  [BR][BR]Now, economic reality might be different from economic theory.  Fares are already extremely low and planes are relatively full so the airlines don't necessarily want more customers paying even lower fares.  They might keep fares where they are and just reap the full benefit of the tax cut....i.e. no consumer benefit.  This is the situation you seem to expect, KCFlyer and I would tend to think you are right....though the low-fare airlines could conceivably throw a wrench in the whole plan.[/P]
[P][/P]
[P]----------------[/P]
[P]Mostly correct, but currently in Happyland, the situation has it that the $200 fare includes all the taxes, so the consumer is apparently willing to pay the money and have the airline hand over the 25% to the government. Airline managment - seeing that the consumers in Happyland are happily paying $200, and needing every extra dollar, will be more inclined to raise the overall fare to the $200 level and not have to turn over any of it to the government. My point is that the argument about the taxes scaring away passengers is not quite correct. [/P]
[P]On the other hand, what IS scaring away many passengers are the $1,500 to 2,000 fares that have the taxes added to them. Which is why I suggest the good old AA value pricing model be used - DONT scare away those last minute passengers with an outrageous fare...DON'T scare the passenger who would be willing to pay a less discounted advance purchase fare with the use it or lose it or $100 change fees. In other words, make it useless for companies to attempt to book hidden city iteneraries, since the fare difference between the advance purchase fare and the full walkup fare would not be worth their time to try to weasle around the rules. You'd get more passengers...and at a profit. At the same time, your super de duper advance purchase fares could be raised to the point where they at least covered the costs, without scaring away leisure travellers. The big boys have the power to compete...even with little or no concessions from their employee groups. Why they don't have the cajones to reduce the full fare price to induce more business travel escapes me. Delta can compete with Southwest or Airtran by matching their fares and not setting out to portray themselves as the low cost leader in markets where they compete, and they can cover any losses on those routes with without charging an arm an a leg for last minute fares on routes where they don't compete. [/P]
[P]Hell, Southwest flies NYC to LA for $299 one way. That comes out to about .122 cents per mile. Delta's costs are .1005 cents per mile, so even Delta could turn a small profit at that fare. But they don't have to. There still is something called customer loyalty, and some folks even like airline food and heavily edited movies, so Delta could get away with charging more. As it is, they charge $1,100(one way). Any guesses as to how many more passengers might book the flight if that last minute fare was something like $500 (one way)? And they can do it without setting up any airline within an airline scheme. [/P][/BLOCKQUOTE]
 

Busdrvr

Veteran
Aug 20, 2002
2,217
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[blockquote]
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On 9/26/2002 5:11:58 PM DalMD88 wrote:

I would expect to pay more to get there faster.

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[/blockquote]

And Safer