Delta CEO talks air traveler headaches, from fees to redeeming miles

Discussion in 'Delta Air Lines | SkyMiles' started by sobore, May 24, 2013.  |  Print Topic

  1. sobore
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    sobore Gold Member

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    Ever wondered why airlines charge so many fees?

    "CBS This Morning" co-host Norah O'Donnell did, and asked Richard Anderson, chief executive officer of Delta Air Lines, why so many fees are being extracted from travelers, from bags to drinks on the planes.

    Anderson noted there are few things at work here: "If you look at the totalities of the cost of air travel today in the U.S. and you include fees on an inflation-adjusted basis," he said, "we're still 10 percent lower today than we were in 2000. Second, the transparency of the Internet gives you the ability to shop a la carte, and third, the industry is incredibly competitive."

    In 2012, Delta earned $1.6 billion in fees from baggage and change/cancellation fees, according to the U.S. Department of Transportation. The industry as a whole made $3.5 billion on baggage fees, and $2.6 billion on airline change fees.

    In addition to fees, Anderson addressed the apparent difficulty "CTM" co-host Gayle King experienced while attempting to redeem frequent flyer miles on the airline's web site.

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  2. USAF_Pride
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    USAF_Pride Gold Member

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    Baghdad Bob has made an appearance again!!
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  3. AMPfromBNA

    AMPfromBNA Silver Member

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    Okay... So they made 1.6B from fees. Lets say maybe 50% are change/cancel fees. That's 800M in fees. How many passengers do they fly annually (embarkations). Let say 200M; it's probably a lot more. Wouldn't the smarter pricing strategy just be to offer a high quality product (like they do now, inflight at least) and charge $4 more per ticket? Their revenue would be the same in the end, with a more straight forward approach to customer service, and likely more passengers choosing their product because of their flexibility with passengers.

    Obviously refunding cancellations would be counterproductive, but same day or even near-day or name change flexibility would allow better flexibility and competitiveness of their product.

    Maybe I just don't get airline pricing models. Oh well... Ill just wait on standby for my next flight, pray to make it, and contemplate how to travel in the future.

    Anyone know how Amtrak works? ;-)
  4. diver90
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    diver90 Gold Member

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    I am nothing short of amazed the way DL and other airlines spin the "benefits" they keep providing us. I actually get a certain kind of morbid / train wreck fascination about reading their press releases mumbling to myself, "That's wickedly brilliant you devious bastards", based on the insane pretzel logic of their positioning. It's like the creature in Hitchhiker's Guide who thinks it's invisible if it covers itself with a blanket or towel. It can't see you, so you can't see it.
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