Senator Chuck Schumer attempts to question in wake of dropping gas prices, should ticket costs be dropping? Senator Chuck Schumer claims that you are having to pay too much for your flight ticket home this Christmas season.
The New York Democrat released a declaration today stating costs should reflect the low fuel costs flight companies have been paying because of the decrease in oil costs.
“At a period when the price of fuel is rapidly declining and earnings are increasing, it really is inquisitive as well as confounding that ticket costs tend to be sky-high and defying financial gravity, ” he stated in the release. Therefore I am advocating the Feds to step up and do a cost analysis for customers who must purchase vacation travel seat tickets that may break their budget.
The industry frequently increases costs very quickly whenever oil costs surge, however they appear to not be modifying for the historic drop in the expense of fuel; ticket costs should not skyrocket like a missile and come down just like a feather.”
Oil costs are sitting at about $60 for each barrel, the cheapest they have been in many years. Schumer states that gas prices may account for as much as half of an airlines price, which means that the decrease in fuel costs might be having massive effects on their bottom lines.
A trade company representing the big US carriers, Airlines for America, said that declining fuel prices meant that airlines could invest again in the business, and that reduced fuel prices didn’t mean as much as Schumer said they were.
“While fuel costs have abated off their historical highs, fuel is simply 1 price, and it is vital that you remember that for the very first 9 months for the 9 widely traded U. S. traveler service providers, operating costs increased 3.1 % in 2014, ” the declaration reads.
“This is really a capital-intensive company, and flight companies are making substantial investments, such as taking delivery of 317 brand new airplanes this year by itself.”
Imperial Capital LLC’s airline analyst, Bob McAdoo, does not believe anything legislative can come from Schumer’s problem, observing that the federal government hasn’t managed the flight business beyond security regulations since the 1978 Airline Deregulation Act.
“From time to time the federal government has discussed re-regulating prices,” he states. “Every time it has been brought up it has been declined in the legislature.”