Originally posted by sh76Airline mergers are interesting because they are generally considered anti-competitive but somehow airlines do not make money. It seems that marginal revenue is never enough to make up for fixed costs. Perhaps it just isn't that lucrative to transport people by air relative to the amount you could make if you transported envelopes.
What effect will it have on consumers in general and you personally?
Discuss.
Originally posted by quackquackAir travel is an example of a service where it is very hard to distinguish oneself with marketing. Furthermore, people understand the service very well, in the sense that people can grasp the concept of going from A to B for as little money as possible quite well. These two reasons make it so that margins will always be slim in the airline business.
Airline mergers are interesting because they are generally considered anti-competitive but somehow airlines do not make money. It seems that marginal revenue is never enough to make up for fixed costs. Perhaps it just isn't that lucrative to transport people by air relative to the amount you could make if you transported envelopes.
Originally posted by quackquackAirlines make plenty of money. Maybe you haven't read the recent financial statements, but AA, US, UA, spirit, VX, etc., are making money hand over fist.
Airline mergers are interesting because they are generally considered anti-competitive but somehow airlines do not make money. It seems that marginal revenue is never enough to make up for fixed costs. Perhaps it just isn't that lucrative to transport people by air relative to the amount you could make if you transported envelopes.
