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Competition in the Airlines leads to… Competition?
Yes, you read that right. There’s been lots of competition in the airlines ever since deregulation happened. Deregulation allowed airlines to price what they wanted, to where they wanted, and offer the service they wanted without government interference. This did lead to a number of airlines not being able to adapt quickly enough, and those who didn’t eventually closed their doors.
Well, today I read an article over on Gawker.com titled “Delta Forces Customers to Agree to Shitty Service Before Purchasing Ticket” about how horrible Delta Airlines is because they were offering a “Basic Economy” fare. Yes, such a horrible idea. Since people shop with their checkbook, yet in someone’s mind they think that somehow their $300 fare should obviously give them extra leg room, a four course meal and free movies and tv, right? Well…. no, no it does not. Simple economics works that if you want render additional services, then you have to pay for them.
So, what is a Basic Economy Fare? It’s a seat with no amenities, no free seat selection, no benefits for SkyMiles Medallion Members, no possibility of upgrades or add-ons, etc. Think, Spirit Airlines, but a bit nicer and with seats that aren’t “pre-reclined.” You’ll still get free soda and those delicious biscoff cookies on Delta, so no worries there. These types of tickets are great for a single person traveling without checked bags, but not for a family of 5 with small children heading to Orlando for vacation with two bags each.
Delta is now doing what some other airlines aren’t: They’re adapting. The influx of discount carriers such as Frontier, Spirit, and low fare behemoth Southwest Airlines have woken up Delta. If they want those passengers to pick Delta, then they need to offer them the same product and/or price.
Here’s the thing, the boom of the 1990s provided a huge expanse in the airline industry adding flights to every state with destinations near and far. The airlines however watched as discount airlines began to slowly nibble away at markets larger airlines deemed unfit for “legacy” airlines to continue service to. They didn’t care because how could these tiny “low cost” and “low fare” airlines possibly be a threat? In the 1990s the discount airlines counted for less than 10% of US market share. Today however, that has more than doubled. Delta Airlines currently holds about 16.9 of the US Domestic Market. But who holds the most you might ask? Well, that would be Southwest Airlines at an amazing 17.6 percent of the US Domestic market! YEP, the largest domestic airline (by revenue passenger miles-RPM) is now Southwest Airlines.
Delta had announced this project of offering Basic Economy fares a while back. I went looking for them, but I couldn’t find them. Since I have to book a ticket home to visit family, I checked Charlottesville, VA on Delta from NYC. Nope. Then I checked New York to Orlando.
That’s where it got interesting. I found basic fares available from New York LaGuardia (LGA) but not from New York- JFK. Having a feeling I knew who this might be after, I checked LGA to Milwaukee, and found basic fares again.
These basic fares would seem to be aimed at Southwest Airlines, maybe others too, however it looks as they are the main source of the fight due to the markets they are being placed in. So, if you find yourself looking for a cheaper ticket, make sure you check all the airlines operating that route, chances are you might find there is some competition after all.
It should be pointed out too though that all the normal Delta Economy seats may be taken, and if no one has sprung up to pay for their Economy Comfort+ seats, you could end up in those seats with extra legroom, where booze and snacks are complementary. It really would be the luck of the draw for that to happen but I’m sure will at some point. In any case, if it was a choice between peanuts or biscoff cookies, I think I’d go for the cookies.
While, I certainly won’t be booking a “Basic Economy” ticket any time soon, for some people, I’m sure they’re happy to find them.
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