And the Fuel Surcharges keep coming

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Kosiw
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And the Fuel Surcharges keep coming

Post by Kosiw »

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MrWings
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Re: And the Fuel Surcharges keep coming

Post by MrWings »

Ahhh .... the fuel surcharge.

They add on the "fuel surcharge" as if to say "hey, all of this goes directly to the increase of fuel".

But we never see things like a "managment wage surcharge" or a "pilot training surcharge" or a "parts surcharge" when those costs increase.

Sure the rising price of fuel means the consumer will pay more. But don't try and fool me by adding the surcharge and indirectly blaiming the governement/oil companies.

In the old days, the price of your ticket would just go up as a reflection in the increased the cost of doing business. The fuel surcharge is just a price marketing scam.
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captaingomes
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Re: And the Fuel Surcharges keep coming

Post by captaingomes »

I agree. I think additional fees like the fuel surcharge should be illegal. This is only a game to be able to advertise a lower ticket price vis-a-vis your competitors. I'm sorry, but if a ticket costs $500 but you add on a $50 fuel surcharge, then the actual cost is $550, and that's what should be advertised.

Finally, the general consensus is that fuel prices are going up, not down, and the high fuel prices are not a temporary condition.
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Re: And the Fuel Surcharges keep coming

Post by Campanola »

It's an abusive use of the word "tax". Tax is the perception of an amount of money by the seller for a third (usually the goverment). Here it's the perception of an additionnal amount by Air Canada and for Air Canada to cover his own operation cost.
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Re: And the Fuel Surcharges keep coming

Post by valvelifter »

MrWings wrote:In the old days, the price of your ticket would just go up as a reflection in the increased the cost of doing business. The fuel surcharge is just a price marketing scam.
I agree 100%; it doesn't make sense how one day they decide to slap on $120 on a x-country round trip whereas yesterday the price of fuel cost the same but I didn't dish out $120. What if the price of fuel shoots up another 10%. Will the surcharge go up by the same amount?

If you're gonna charge, then I am not a fan of fixed fuel fees, because it doesn't make sense that I pay the same tax when travelling from YUL to MIA or YYZ to LAX. (flights >1600km)

And should the price of fuel go down for a couple of months, will they remove the 'tax' in the meantime?

On a smaller scale, my flight school had one of those taxes when gas hit a buck a few years ago. It went back down after but the tax remained, until people complained and the tax disappeared.
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Post by whiteguy »

If the fares do go up then people will still complain. Don't like it, drive! Like I've said before until people are willing to pay what it actually costs to fly you'd better get used to it. Airlines are there to make money not to be your personal transportation for free.
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Re: And the Fuel Surcharges keep coming

Post by valvelifter »

Not really. Most people wouldn't complain if the fares went up along with the price of fuel, within reason of course. People know what's going on with the fuel situation, they live it at the pumps everyday. Fuel expenses are driving inflation up big time, and affecting the cost of just about everything from plastics to veggies at the store. It is only natural that airlines will hike up their prices as well. My beef is that the relationship between fuel prices and these fixed taxes are not linear; one day fuel costs example $1.50, I pay no surcharge. Next day, the price goes up to $1.51, they slap $120!!! Doesn't make sense. How do the airlines expect the consumers to be calm and understanding about adjusting fares in this manner? What's wrong with some sort of variable fuel surcharge that is already included in the price?
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Campanola
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Re:

Post by Campanola »

whiteguy wrote:If the fares do go up then people will still complain. Don't like it, drive! Like I've said before until people are willing to pay what it actually costs to fly you'd better get used to it. Airlines are there to make money not to be your personal transportation for free.
Complains are not about fares going up. It's about the method used to increase it. Taxes are for goverments. So, if it's not tax for the goverment, it's hidden fees.
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Re: Re:

Post by whiteguy »

Campanola wrote:
whiteguy wrote:If the fares do go up then people will still complain. Don't like it, drive! Like I've said before until people are willing to pay what it actually costs to fly you'd better get used to it. Airlines are there to make money not to be your personal transportation for free.
Complains are not about fares going up. It's about the method used to increase it. Taxes are for goverments. So, if it's not tax for the goverment, it's hidden fees.
They're not hidden. When you book a flight you can click on link to explain the taxes, if you don't thats your problem not the airlines.
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Re: Re:

Post by Campanola »

whiteguy wrote:
Campanola wrote:
whiteguy wrote:If the fares do go up then people will still complain. Don't like it, drive! Like I've said before until people are willing to pay what it actually costs to fly you'd better get used to it. Airlines are there to make money not to be your personal transportation for free.
Complains are not about fares going up. It's about the method used to increase it. Taxes are for goverments. So, if it's not tax for the goverment, it's hidden fees.
They're not hidden. When you book a flight you can click on link to explain the taxes, if you don't thats your problem not the airlines.
Hidden fees dosen't mean that you can't know what it is. It means hidden charges not included in the advertized prices, excluding goverment taxes.

:?: I guess you work for AC? Am I wrong?
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Re: And the Fuel Surcharges keep coming

Post by whiteguy »

Campanola wrote:It's an abusive use of the word "tax". Tax is the perception of an amount of money by the seller for a third (usually the goverment). Here it's the perception of an additionnal amount by Air Canada and for Air Canada to cover his own operation cost.
The only one using the word "Tax" is you!
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Re: Re:

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Hidden fees dosen't mean that you can't know what it is. It means hidden charges not included in the advertized prices, excluding goverment taxes.

:?: I guess you work for AC? Am I wrong?[/quote]


Yes, you're wrong!
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Campanola
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Post by Campanola »

whiteguy wrote:Yes, you're wrong!
Ok, Jazz then (to me it's the same)? Or, you did work for them (AC or Jazz) in the past, as a pilot or anything esle?
I'm saying that because it seems to me that you don't like when people are talking against them.
We rarely see people who are willing to defend silently added hidden fees.

And you'r right. They are using the word "Tax" only in the french media. Air Canada itself is using the word "Supplément", not "Taxe". But still, it's hidden fees to me and it's fooling the consumer.

The fuel surcharges is hidden in "Navcan and Surcharges 116.00$":
Flight 1 - Departing airfare (Tango) 109.00
Flight 2 - Returning airfare (Tango) 89.00
Navcan and Surcharges 116.00
Canada Airport Improvement Fee SQ 40.00
Canada Security Charge CA 9.33
Canada Quebec Sales Tax (QST #1000-043-172) XQ 1.58
Canada Goods and Services Tax (GST/HST #10009-2287) XG 18.17
Total airfare and taxes before options (per passenger) 383.08
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Re: Re:

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Campanola wrote:
whiteguy wrote:Yes, you're wrong!
Ok, Jazz then (to me it's the same)? Or, you did work for them (AC or Jazz) in the past, as a pilot or anything esle?
I'm saying that because it seems to me that you don't like when people are talking against them.
We rarely see people who are willing to defend silently added hidden fees.

And you'r right. They are using the word "Tax" only in the french media. Air Canada itself is using the word "Supplément", not "Taxe". But still, it's hidden fees to me and it's fooling the consumer.

The fuel surcharges is hidden in "Navcan and Surcharges 116.00$":
Flight 1 - Departing airfare (Tango) 109.00
Flight 2 - Returning airfare (Tango) 89.00
Navcan and Surcharges 116.00
Canada Airport Improvement Fee SQ 40.00
Canada Security Charge CA 9.33
Canada Quebec Sales Tax (QST #1000-043-172) XQ 1.58
Canada Goods and Services Tax (GST/HST #10009-2287) XG 18.17
Total airfare and taxes before options (per passenger) 383.08
Okay you are right I did use to work for AC but I would still defend any airline that adds a fuel surcharge. Pax in Canada don't how good we have it with the price of fares. Look at the fares you quoted, do you think any airline is making money let alone breaking even at those prices. I watch the news every night and listen to people say aren't going to drive anywhere this summer because gas is to expensive yet they expect airlines to not increase they're fares. Give me a break!

I had alook at YYC-YWG return and it was $400 total. Drive to YWG and see how much it will cost in time and money.

I think there should be more of an outrage about the AIFs that are being charged!! and the government security charge which is double what the US charges!
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Re: Re:

Post by Campanola »

whiteguy wrote:Look at the fares you quoted, do you think any airline is making money let alone breaking even at those prices. I watch the news every night and listen to people say aren't going to drive anywhere this summer because gas is to expensive yet they expect airlines to not increase they're fares. Give me a break!
As pilots, we all want to work for a financially healthy airline. So I agree, they must increase their prices. I just don't agree with the way AC is doing it. I am annoyed by the difference between the price they sell and the price we pay at the end and the difficulty to compare accurately the price between two airlines based on their ads. Maybe it's the goverment who should change the rules.
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Re: And the Fuel Surcharges keep coming

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valvelifter wrote:My beef is that the relationship between fuel prices and these fixed taxes are not linear; one day fuel costs example $1.50, I pay no surcharge. Next day, the price goes up to $1.51, they slap $120!!!
It's not a mystery that the price of fuel has almost doubled since this time last year. This is the first major increase in fuel surcharge during this time. Over the last year of escalating fuel prices, who do you think absorbed the additional operating costs brought on by the price of fuel? The airlines.

You can't increase the price of tickets/surcharges/taxes - whatever you want to call them - on a daily basis. Instead, prices are adjusted to reflect current operating costs at larger intervals. This is why, as you say, one day there is no surcharge, the next day "they slap [on] $120". If you want to see a linear increase in fuel surcharges, talk to the oil companies. The increase in fuel surcharge is only as linear as the increase in the price of oil.

Also, for those contesting the fact that the increased operating costs be labelled as a fuel surcharge vs. an increase in ticket price, this is attributed to the volatility of fuel prices. These days it's anyone's guess what the price of fuel will be tomorrow. And since with every increase in fares the airlines are bombarded with accusations of gouging travellers, there has to be a method of differentiting fare increases that are a result of the airlines actions and fare increases that are out of their control. The fuel surcharge is a way of saying: "Hey guys, we hate to raise the price of your tickets again. But we aren't trying to steal your money. We're just trying to pay the gas bill, as is every other Canadian when they fill up their car at the pump."

These days fuel is the single largest expenditure of airlines, and as long as the price of fuel increases uncontrollably, so will the fuel surcharges. It sucks, but such is reality.

Regards,

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Re: Re:

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Campanola wrote:
whiteguy wrote:Look at the fares you quoted, do you think any airline is making money let alone breaking even at those prices. I watch the news every night and listen to people say aren't going to drive anywhere this summer because gas is to expensive yet they expect airlines to not increase they're fares. Give me a break!
As pilots, we all want to work for a financially healthy airline. So I agree, they must increase their prices. I just don't agree with the way AC is doing it. I am annoyed by the difference between the price they sell and the price we pay at the end and the difficulty to compare accurately the price between two airlines based on their ads. Maybe it's the goverment who should change the rules.
Yes we do and I agree maybe advertising should be a little different but don't single out AC for doing the exact same thing all the airlines do. Do you think WS will include its fuel surcharge in the price, no! When people book the look at the lowest price thats advertised in the paper or website. Alot don't even know they pay more after all the taxes. I know alot of people don't even look at AC to travel because they assume WS is always the cheapest.
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Re: And the Fuel Surcharges keep coming

Post by valvelifter »

PilotFlying wrote:It's not a mystery that the price of fuel has almost doubled since this time last year. This is the first major increase in fuel surcharge during this time. Over the last year of escalating fuel prices, who do you think absorbed the additional operating costs brought on by the price of fuel? The airlines.
I don't dispute that airlines absorbed the price of fuel over the last couple of years. I did/do enjoy the incredibly cheap fares you sometimes find. It doesn't make sense actually. And they had to absorb the fuel costs because every other airline was doing the same, and if you start charging more realistic prices, well, everyone else will book on the other airline b/c it is cheaper, and I wouldn't blame anyone for doing that. I know I will get nailed for this one but the gov't has to get involved. If you add this surcharge, it means that you are not charging enough in the first place to cover costs and make a profit. Why not just charge correctly in the 'fare' and forget the surcharge? And I mean this comment to the airline industry as a whole, not just AC.

Here's an analogy: I contract my snow cleaning to a company (well worth the $ this past winter..) and they mentioned to me that they will have to increase their price (as they did last year) b/c of high diesel costs (completely understandable). And when I will receive my bill next fall, I will get charged one price, not a 'ridiculously low price' + 'please help me out the price of fuel is killing me' surcharge.

Bottom line is that no one likes to pay surcharges; it just looks bad. Just charge me what it costs you to perform the service and whatever extra to pay your bonus.
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Re: And the Fuel Surcharges keep coming

Post by kevenv »

My biggest peeve on airline charges is the NavCan fee. NavCan doesn't charge passengers anything, The airlines are not collecting it on behalf of NavCan like they do with the AIF's. Plus, when NavCan gives money back to the airlines, passengers never see it. Where do we stop? Maybe they could reduce ticket prices to YYZ even more and then add a "landing fee" surcharge. I'm with all the others who say "charge me what the price will be, that is the fare". If all airlines in Canada were forced to advertise the total price it would be a level playing field.
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Re: And the Fuel Surcharges keep coming

Post by snoopy »

valvelifter,

You raise some valid points, but unfortunately, whether you are talking 705 or 703, the reality doesn't work that way - and I'm speaking from experience as a partner in a 703 Operation.

" If you add this surcharge, it means that you are not charging enough in the first place to cover costs and make a profit. Why not just charge correctly in the 'fare' and forget the surcharge? And I mean this comment to the airline industry as a whole, not just AC."

First off, all corners of aviation are competing for a declining market for various reasons. Then, consider that neither the rates, nor operating locations/conditions are regulated since de-regulation took place and TC has subsequently abandoned regulatory oversight, so free market prevails in every way.

Whether you are talking low budget airlines or your local Mom and Pop charter outfit, there is nothing to stop an operator from undercutting the rates required to properly sustain all operating costs, and god forbid, actually make a profit. Kind of like cutting off your nose to spite your face, but it happens everywhere all the time and somehow the rate-cutting operator survives, or maybe they don't.

If they do survive, it's usually at the price of legitimate competition - but eventually they have to change their ways in order to cover costs because you can't run at a loss, creatively hide actual costs, or cut corners forever (well, some operations seem to be able to - but then some regulatory oversight! would cure that). If they don't survive, that too will often be at the expense of legitimate competition - basically dragging "the enemy" down with them, and everybody loses.

So whether people charge a fuel surcharge, or higher rates, the only way for everyone to survive is to charge fair and proper market value for services.

The trouble with this rational solution, is we are talking about the human race, and human nature, which collectively is at a disgustingly low state of evolution. Don't believe me? Watch the world news. No matter how many parties reach consensus to fix the market rates at fair value, somebody will try and cheat the system and the house of cards collapses.

The only thing that will rectify the situation until such time as the human condition improves, is re-regulation. And how can we implement THAT when we can't even get the government to effectively oversee safety and rectify the injustices within, and caused by, their own department?

I agree with your point about the surcharge: "Bottom line is that no one likes to pay surcharges; it just looks bad. Just charge me what it costs you to perform the service and whatever extra to pay your bonus."

Unfortunately, we don't all justify or quote our rates in the same manner, and it is left up to the smart consumer to ensure they are comparing apples with apples, and sift out the oranges. But often, the less wary consumer gets duped by what I would consider unethical marketing practices, and others would consider smart business. It works like this: If I quote you x number of dollars per mile, accounting for all costs and giving you "the bottom line", and our competition quotes you a lower rate and neglects to mention the fuel surcharge you will pay when you show up for the flight, chances are you will book with the competition due to the apparently lower rate. Unfortunately, by the time you realize you have been duped, it is too late - arrangements have been made, your stuff is already on the operators dock or at the departure gate and it is too much hassle to change your plans. The operator shrugs it off as a surcharge which "everyone" is charging, maybe they give you good service and maybe not, and you decide you're not mad enough to complain or go elsewhere.

So if the consumer doesn't demand fairness and equality, the government doesn't legislate it, and the human race isn't mature enough to offer it, then we will all continue to suffer the effects until something changes. Maybe complaining a bit will make us feel better, maybe not. Change would be better.

My two cents...

Cheers,
Snoopy
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Re: And the Fuel Surcharges keep coming

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valvelifter wrote:If you add this surcharge, it means that you are not charging enough in the first place to cover costs and make a profit. Why not just charge correctly in the 'fare' and forget the surcharge?
You're absolutely correct, valvelifter. I agree with you 100% that the price of a ticket should be one price including all the fees/surcharges/taxes, etc., reflecting the true operating cost + profit (as this is a business, after all) of the price of a seat from point A to point B. The problem is this: people LOVE to HATE airlines. At the first sign of any increase in fares or changes to service, everyone and everything starts pointing fingers and accusing the airlines of stealing even more of travellers' money. A perfect example was one of the front page headlines in the National Post on Saturday: "Air Canada slaps passengers with $120 fuel surcharge" (or something to that effect), insead of "Fuel prices force Air Canada to add fuel surcharge". If the price of tickets were raised to reflect the increase in fuel cost, the headline would read: "Air Canada gouges travellers with 10% increase in fares" insead of "Rising fuel costs lead to increase in ticket price". Why is this even front page news in the first place? Did UPS make the headlines for increasing their rates as a result of fuel costs? Or how 'bout the local produce store charging more because it cost more to ship their products? Shoppers Drug Mart? Your plummer? I could go on.

So, in a way, the fuel surcharge and other fees is a method of itemizing the price of a ticket, to make it perfectly clear to customers where their money is going. This much goes to NavCanada. This much goes to the Airport Authority. This much goes to fuel, and so on. And only THIS much goes to us. It can definitely be argued that this is a sneaky way of selling a ticket, but it is no sneakier than slapping on an additional 14% in provincial and federal taxes at the time of purchase of an an item off the shelf at WalMart. Until travellers truly appreciate the cost of that airline seat from point A to point B, and, as snoopy most accurately explains, competitors stop mercilessly undercutting, I don't see these hidden extras disappearing. In other words, don't hold your breath.

It really is too bad that it is this way. But again, in a way, we have shot ourselves in our own foot on this one.

Regards,

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Re: And the Fuel Surcharges keep coming

Post by fortis risk »

What does it really matter, if it costs to much than don't but the ticket. Its not like they wait til your at the gate to sping the fuel surcharge on you. People are free to make up their minds.

I want a healthy aviation industry for as long as we can keep one. If this helps then cool.
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Re: And the Fuel Surcharges keep coming

Post by Kosiw »

Westjet is introducing fuel surcharges too !

WestJet introduces fuel surcharge on all flights
The Canadian Press

May 12, 2008 at 3:00 AM EDT

CALGARY — WestJet is following the lead of Air Canada and several U.S. air carriers by adding fuel surcharges on all flights, starting Tuesday.

The Calgary based airline says the surcharges will boost ticket prices for short-haul flights by $20, $30 for medium range flights, and $45 for long-haul flights.

WestJet executive vice-president Bob Cummings says the “unrelenting and unprecedented increases in the cost of fuel over the last year” forced the airline to make the difficult decision.

Fuel surcharges introduced by Air Canada last week boosted its ticket prices by $40 for return flights of less than 480 kilometres and $80 for return flights between 480 and 1,600 kilometres.

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Porter Airlines said last week that it too was considering adding fuel surcharges.
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Re: And the Fuel Surcharges keep coming

Post by backon3 »

Air Canada adds Fuel surcharge = Evil Empire rapes travelling public

Westjet adds Fuel surcharge = Just keeping up with industry standard...
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Re: And the Fuel Surcharges keep coming

Post by Campanola »

Well, Air Canada was the first to use this bad way to increase their income, WestJet had no choice to follow. That's why I think the goverment should stop this and request airlines to include the fuel in their price. Now we are loosing controle of the way airlines are selling their prices.
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