The Wal-Mart Age of Air Travel

In 1955, a Trans World Airlines flight from Boston to Los Angeles would take 12 hours and cost $106 in 1955 money, which is damn near a thousand dollars today. New York to Paris was 14 hours and three times as much. I just as of writing looked up a New York to Paris flight for two weeks from now, and the flight can be had for under a thousand today-dollars and is over in 7 hours flat. What was once a luxury item available only to the wealthiest Americans is now a commodity made accessible to as many people as possible.

Recently, a much more popular travel blogger wrote about his experience on Spirit airways. If you've been living under a rock for the last decade, Spirit is one of the new waves of low-cost carriers (LCCs, in the parlance). In his experience, the tickets were unbelievably cheap if you can figure out all the little rules the LCCs use to nickel and dime you -- if you're not careful they end up being more expensive than the conventional carriers -- but it also ends up with a clientele that casually drops racial slurs in mixed company. This has the potential to sound like a very classist statement, and certainly the people who could afford to drop a typical household's monthly take-home in 1955 probably included their fair share of such people. In fact, in 1955 it's pretty unlikely that TWA would even let a black person on their plane, even if they could afford it. In fact, I do feel a little icky even writing this paragraph, because I think travel has the potential, more than any other activity, to open ourselves up to different people with different perspectives. And in fact I'm certain 99.9% of Spirit flyers are perfectly reasonable people trying to get somewhere while spending as little as possible. And I'm not saying this just to hedge. I really believe that almost everybody who gets on a plane is a perfectly normal, respectful person who is not inclined towards dropping the n-word and just wants to get from Point A to Point B.

But I've never heard anyone just outright spew racial slurs on a United flight, and I have seen someone get kicked off the plane for being overly drunk and belligerent with the flight attendant.

LCCs, and the even newer ultra-LCCs, have democratized air travel. This means that more people have access who didn't before. Frequently those are people in low-paying jobs who just want to go see a family member or a wedding and they couldn't afford to do it before but now they can, which is awesome. It's great that people can take family vacations abroad and don't have to be rich to do it. But it also means that everybody's fantasy of the non-existent Golden Age of air travel, where everyone is in a suit or a nice dress and the seats are Morris chairs bolted to the floor and the flight attendant offers to light your cigar with your Scotch, meets the harsh reality of the Wal-Mart Age of Air Travel.

When the automobile first came out, before the Model T, there were coach builders who would take the chassis and engine and build whatever you could imagine around it. Clark Gable's car looked nothing like any other car on the road. This was luxurious and exclusive and made cars into art museum pieces. It was also staggeringly expensive. There are modern equivalents. For example, Carrozzeria Touring took the Alfa Romeo 8c Competizione ($299,000 in the US markets, €199,000 in Europe) and built the Disco Volante (each car was custom, but a typical price was $500,000). The point is, exclusive things, things made with human craftsmanship instead of a factory, with human attention to detail and the best quality bits and pieces cost substantially more than their mass produced counterparts. The ability to mass produce low quality goods for very low prices drives the big box chains like Wal-Mart.

And that cheap, low quality mass production has spread into the airline industry. A typical business class seat on a typical regional aircraft for a typical width X pitch = area of 5.5 square feet. A "premium economy" seat may have 4+ square feet, and coach has about 3.75 square feet. So a business class seat is nowhere near twice as big a footprint as a coach seat, but the tickets are frequently two or three times the cost of a coach seat. Meaning the profit margins on business class seats are much higher than coach, but the airfares of the past made them sufficiently exclusive that most people didn't pay for them. They were trying to sell Clark Gable's bespoke automobile to people who wanted a Model T.

Furthermore, because of deregulation in the 70s and more fuel-efficient planes and lower fuel costs, airline tickets in general are as cheap as they've been historically. And the old truism that "you get what you pay for" still applies to the airline industry.

The net effect of this is that more and more people want to fly, and the airlines really would like to increase the supply, but buying more airplanes is expensive and has a few years of lag time, while jamming more seats into a given airplane is cheap and easy and quick to implement.

To meet the demand that results from the low airfares, the airlines are jamming as many people as possible into the back of the plane without lowering airfares, and then charging for things they didn't used to charge for, starting with exit row seats and moving on to checked bags, food, and for the u-LCCs pretty soon using the toilet. They're making business class more accessible to wring every last dime out of travelers instead of making those seats prohibitively expensive so only loyalty-based upgrades of people on an infinite expense account have access to them. All while claiming poverty and unfair competition with foreign carriers and then reporting record profits quarter after quarter.

The upshot of all this is that business class seats are getting cheaper so that the airlines get cash for them instead of upgrading someone with high loyalty status (this is a different discussion altogether, but top tier flyers are no longer necessarily guaranteed an upgrade because the seats that used to cost $500 more now cost $150 and there are more buyers at that price) and earning nothing but "loyalty", and loyalty doesn't line shareholder pockets. This is to put butts in those seats while earning money for them. When air travel was expensive and airlines competed directly with each other, customer loyalty was important. Now that most regular travelers have only one choice, if you have to fly you'll fly with your local hub airline and if you fly once a year you're such a small part of the airline's revenue base that they just don't care about you.

Air travel in the United States is now characterized by a lack of real competition in most markets, a handful of large players dominating those markets, and providing an accessible, low quality product at prices that seem low but are probably higher than they should be, and when you the consumer complains they shrug and say "where else are you going to go?" The lack of competition means that there's no real need for the airlines to differentiate, meaning they don't care about loyalty programs because they already own you, and they don't care about customer service because a customer service problem doesn't actually lose them a customer, since frequent travelers will be back at the same hub again and the once-a-year travelers frankly don't matter to the airline revenue.

But the situation is actually worse than the automobile metaphor would imply. The car market has a lot of strata, and people who will pay a normal house's cost for a car and people looking for a thing that goes from Point A to Point B as quickly as possible. But even the cheaper cars compete freely with each other, and the high end manufacturers pioneer technology that ends up in every car within a decade, meaning that the cheapest cars of today are so, so much better than even the best cars twenty years ago. But airlines don't compete, and the market is skewed heavily towards people trying to find the cheapest option instead of the most comfortable, because for most people most of the time the suffering lasts three hours and then it's over, whereas you're stuck with a bad car for years. So there's really, truly, in this market, no incentive for the airlines to be anything but rock bottom for as cheap as they can be.

We are definitely in the Wal-Mart Age of Air Travel.

The funny thing is, like the Wal-Mart age of everything else, we have better options, we just won't pay for them.

JetBlue is a great airline, especially if you happen to live in one coastal metropolis and fly transcon regularly. Virgin America offered a fantastic product across the board. These airlines are generally a bit more expensive than their Legacy counterparts. JetBlue is putting along okay, but Virgin America got bought by the great aunt sweater of airlines, Alaska, after passengers wouldn't pay the extra twenty bucks for nice air travel.

The problem here is that, even more than the big box market, it's really hard to start a new airline. The new Boeing 737 MAX costs over a hundred million dollars a unit. The only way in is for a billionaire to make it his vanity project (*cough* RichardBranson *cough*) for someone really savvy to start out small and hope to build up by filling their airplane every time.

So, oddly enough, the cure for the Wal-Mart Age of Air Travel is the same as the cure for Wal-Mart in general. You have to take your business to the JetBlues and Virgin Americas and whatever Richard Branson has in store now that his pet project was sold over his toothless objections and be prepared to pay a few extra bucks to get a nice thing. Given the success of LCCs, to the point that airlines like British Airways are even copying their model, I am not sanguine that we will reach the Artisanal Age of Air Travel any time soon.

But a man can dream.