brip blap

personal finance, wealthbuilding and the journey to financial freedom

Aug 14, 2007

flying on the cheap (for the airlines, not for you)

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I have not flown Northwest Airlines in a while, although I once flew them frequently. I was taken aback on my recent flight to notice that they are now charging for snacks. Charging for every single last type of service is the model used by Ryanair, an Irish airline. The traditional airlines - Continental, Northwest, United, etc. - have had a series of bad years which do not appear likely to improve in the near term future. I think the future model will be to pay for food, drinks, even water and blankets on airplanes. Ryanair already goes so far as to charge you for having luggage. Soon I could imagine charges for that free cup of coffee, or even a charge to board the plane first. Imagine if this pricing scheme was applied to other aspects of life:

You can sit on the subway if you have a gold Metrocard.
You can drive between 55 and 65 with a gold E-Z Pass or between 65 and 75 with a platinum E-Z Pass.
You can take the elevator for $1 or the stairs for free.
Taking the moving sidewalk at the airport cost a quarter.
Airlines charge you $1 per hour for reading lights.
An elevator might not open if you don’t pay first.
An airline might charge you for water - or even to use the bathroom on the plane.

Before you think any of those ideas are too far-fetched, consider this: the New York subway system will soon allow you to tap a credit card on the turnstile to let you through. In Japan, you can wave your cell phone near items you want to buy and pay for them that way:

Sony, working with NTT DoCoMo, has been spearheading the mobile phone wallet technology, commonly known as ‘FeliCa‘. This technology makes use of a RFID chip inside the handset that can communicate with reading devices when the phone is placed near them. Though the technology is relatively new, there are many locations such as convenience stores which allow users to pay for goods using their phones; some vending machines even accept phone payments. Users must ‘charge up’ their accounts with credits before they can pay using their phones. The growing popularity of the system is compelling other manufacturers to make compatible phones.

So imagine if it becomes possible to wave your cell phone at any item with a bar code and pay for it that way. It makes the current credit card situation look positively benign. You will have your “waving card” in your hand all day to pay for the slightest small item or service, and keeping track of it will be impossible. Your daily life might end up being dozens of small transactions. I think ultimately Americans will pay more for things we accept for granted if we think we’re getting a “bargain.” If I can get a “free flight” as Ryanair often offers, I head off to the airport gloating about my frugality, only to find it’s $3.50 to check luggage, $19.95 to bring my bag onboard with me, $11.95 to use my laptop in flight and $2.99 per minute in the bathroom. By the time I get to my destination, I’ve spent $212 and it’s no cheaper than a “traditional” airline. Restaurants and bars hook people in with cheap appetizers in order to get them to buy expensive entrees and drinks. Credit card companies offer low initial rates to encourage running up debt.

This scenario was what I thought about as I paid for a $5 snack since my 17-month old son, my wife and I were all hungry and I hadn’t had the foresight to buy snacks for a 6:30 am flight. I got a cheaper ticket by flying Northwest but all of these services I’ve taken for granted in the past will be disappearing year by year. When you book a cruise, you book a more-or-less all-inclusive ticket. I think this will lead to an overall inflation in expenses and one more headache for the American consumer.

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12 Comments, Comment or Ping

FourPillars

$212 for a free flight? How much time did you spend in the bathroom?

Aug 14th, 2007
SavingDiva

I dislike flying. With the strict security, it takes such a long time….If I can drive there in under 12 hours, I usually choose to drive. However, I was forced to fly recently…and I found the entire thing ridiculous! I chose to starve instead of paying $1 for a bag of pretzels! Spite takes me a long way….

Aug 15th, 2007
dong

I hate the airport and would rather take the train if I could. It’s a really a shame rail travel is not more prevalent in the U.S. The eastern seaboard would be perfect for TGV style trains….

Aug 15th, 2007
bripblap

The $212 was for the beers to “calm my nerves”.

You know, I would really be amazed if anyone commented that they liked flying better than other means of transportations. It’s become a painful experience almost every single time I fly, and when I fly a lot (3 round trips in the last 5 weeks) something is almost guaranteed to go wrong. I would take trains more often but they are so expensive coming out of NY that it’s hard to justify. Driving is dangerous and costs a fortune with gas hovering in the $2.70+ range, not to mention northeastern states’ toll roads.

Traveling is just tough any way you look at it, but if there are enough stories about people being stuck on the tarmac for 20 hours like in LAX or with Jet Blue back around Valentine’s Day, you’ll see more and more people either (1) opt out of flying or (2) demand better service even if it costs more.

Aug 15th, 2007
Lora

I also flew NW recently and boy, their planes are SO old! It made all sorts of ricketty noises, I thought it was about to fall apart.
The airport services have not improved, the security lines are a killer. Just that alone will make you think twice about air travel. Anybody flew out of Washington, DC recently? Yeah. Liked the line there???? The worst airport is in the country’s capital. What a shame.

Aug 16th, 2007
bripblap

DC, LaGuardia and Detroit are in a neverending battle for Worst Airport Ever. My personal worst is LaGuardia, since it’s the place where I got stuck in an airplane for four hours in the middle of July a few years ago. It was a tiny jet and it was sweltering hot - and they wouldn’t let us off the plane (not a surprising story, I bet). Ever since then good old two-runway LaGuardia has been my least favorite airport. But DC is a close second. The security setup there is as painful as any place I’ve seen outside of the remote third world.

Aug 16th, 2007
Laura

Oh, my gosh, have you ever been on a cruise? It’s all-inclusive unless you want: soda, alcohol, food at some of the shops, shore excursions, tips are extra but required, etc. They’ll do anything to nickel-and-dime you!

Aug 20th, 2007
bripblap

@Laura - Laura, thanks for the comment - you’re right, you definitely can nickel-and-dime-and-dollar on the cruises. Depends on your approach, I guess. My in-laws get on the cruise and won’t pay a dime extra - they don’t get alcohol, drink whatever’s offered free, don’t do but maybe one excursion, etc. They avoid every expense they can. I tend to go the other direction and mentally estimate an extra 30% to my base cost. But I guess the difference I would make is that the base transportation/food is all included.

Aug 20th, 2007