This is from the Nation.
http://www.nationmultimedia.com/2008/06/07/business/business_30074952.php

perhaps interesting times ahead.

Many thanks for this one, your right it is interesting.

Janner

$400 per gallon? I know oil is expensive, but surely that cannot be correct! $400 per tonne perhaps?

I don't know how they claim to lose money on the London flight.

I've only ever been on flights which are practically full.

Nick

Interesting - but I wish someone would clue me up on the economics of airlines. I can't understand why their response should be to cut routes. They have hiked up their prices to the point where many of my friends take a split flight. I'm going to do that myself next time, as there are 2 of us flying and the saving are in the £100s. So they end up flying with less people on board, and now cutting flights to London. It seems to me that they are not being competitive enough, and will be subject to the law of diminishing returns if they are not careful

quote:

$400 per gallon? I know oil is expensive, but surely that cannot be correct! $400 per tonne perhaps?

I think they meant cents rather than dollars.

The current price is 382.6¢ per US gallon, $160.7 per barrel (42 US gallons)

The price in 2000 was only 87¢ per US gallon.

http://www.iata.org/whatwedo/economics/fuel_monitor/index.htm

It's simple supply and demand.

Before the Summer holidays, July 9th, WestEast are quoting about £650 on Thai.

From the 10th July until 15th August the price goes up to £860!

Nick

Instead of selling the A340-500 from the New York route, it's a pity they don't put them on the London route. The current 747's could then go into a museum.

quote:

Instead of selling the A340-500 from the New York route, it's a pity they don't put them on the London route.

I have flown this route on Singapore air and the planes have very few seats compared with a 747-400, (they are like a flying gas station, no room for any more seats and even if they tried to shoehorn some in, 18-21 hours stuck in an economy seat would mean very few passengers would arrive alive), so it would not be economical to put them on the London route. They only have executive economy and business seats and few of the latter. I don't know why they didn't take the lead from Singapore air and change all the seats to business class but then Thai airways business class isn't that competitive.

Interesting how the national carrier and main airport reflects on the country. Look at Air Canada, once a very good airline, then the pits, and now recovering and Toronto airport has a nice new terminal that actually manages to get your baggage on the same flight as you.

Then you have Singapore air and Changi airport, the best in the world by some margin in my view, indicative of the efficiency and cleanliness of Singapore, a real flagship for the country.

Now Thai airways is on the way down with poor service and decrepit planes and a nice new non-functional airport that only proves that all that glitters is not gold.

And then we have the worst airline in the world, British Airways and the worst terminal in the world, Terminal 3, not that the other terminals are anything to write home about.

quote:

It's simple supply and demand.

I think it's more likely to be price fixing. In a truly competitive market, I believe there would be someone who would undercut those ridiculous prices. It seems like they hike up fares to every destination because they know many people have to take their holidays then. I haven't seen any evidence that significantly higher nujmbers of people fly to Thailand in the summer hols.

quote:

Originally posted by prioritypress:
I don't know how they claim to lose money on the London flight.

I've only ever been on flights which are practically full.

Nick

I flew THAI in late march and again 2 weeks ago, and max 60 % capacity...i got middle 4 seats to myself on the last return trip! best flights ever haha

... which brings me back to my original point. The economics of it are clearly - if you're cheap enough you're full ( where there is competition). In my opinion Thai Airways is in danger of pricing itself out of the market - hence half empty flights vand route cutbacks

No mention of the fact that Thai do not hedge as much of its fuel purchases as many other airlines. This would have a massive impact on exactly what they are talking about.

Very poor financial management, but then that is endemic throughout many Thai companies.

If that's what is happening Steve, I would say the !poor finacial management" is verging on the disastrous - and heads should roll . I still find it hard to believe they are going to reduce London flights. If they can't compete here, where are they going to compete ? - surely not against Asia X

There's so much national 'pride' amongst airlines that I wouldn't be surprised if the government step in and prop them up further. They've only been doing that for the past 50 years.

Thai Airways International 'Public' - yeah right!

Packpao

Its expensive because nowadays we are paying c £199 in fees and taxes.

And no just because the taxes keep getting raised does not reduce my carbon footprint just the amount of Chang I can afford when I get there.

Richard

quote:

Its expensive because nowadays we are paying c £199 in fees and taxes

yeah but.. yeah but ..yeah but other airlines can still undercut them by £100

quote:

And no just because the taxes keep getting raised does not reduce my carbon footprint just the amount of Chang I can afford when I get there.

Richard

Exactly!!

quote:

quote:
Its expensive because nowadays we are paying c £199 in fees and taxes


yeah but.. yeah but ..yeah but other airlines can still undercut them by £100

I would be careful about booking with a cheap airline too far in advance as if the fuel prices etc rise more quickly your likely to end up not flying at all or even better(worse) stranded in Bangkok.

Airlines need to make a profit except for National carriers and if the cheap one make a loss then they do disappear. Given long haul the main variable cost is fuel then prices must rise.

ash

quote:

Originally posted by ash:

quote:

quote:
Its expensive because nowadays we are paying c £199 in fees and taxes


yeah but.. yeah but ..yeah but other airlines can still undercut them by £100

I would be careful about booking with a cheap airline too far in advance as if the fuel prices etc rise more quickly your likely to end up not flying at all or even better(worse) stranded in Bangkok.

Airlines need to make a profit except for National carriers and if the cheap one make a loss then they do disappear. Given long haul the main variable cost is fuel then prices must rise.

ash

Just a thought Guys but maybe flying with those airlines who have their own supply of oil sounds sensible to me ie; Qatar, emirates Etc etc. At least they have a stable supply!!
On checking recently for a flight in Jan 2009 from Manchester Emirates and Qatar were the only carriers offering competitive prices.
They must be laughing all the way to the bank (their own bank) at the latest Thai fiasco.

Regards Harvey

quote:

stranded in Bangkok.

I can't think of a better place to be stranded.

Packpao

quote:

Originally posted by packpao:

quote:

stranded in Bangkok.

I can't think of a better place to be stranded.

Packpao

Agree

I know THAI seem to be getting lots of bad press abt their fares ect at the moment. I know i was a little shocked when i saw their fares to BKK in december
But their fares through to Sydney are about the best i could find. Around £1300 with Trailfinders. I often use Trailfinders (esp Newcastle branch...on phone...always seem quiet there!) due to good fares, customer service and they DON'T charge a credit card fee!

quote:

Qatar, emirates Etc etc. At least they have a stable supply!!

I saw a report on the news yesterday saying Iraq had so much oil it was seeping out of the ground and the Americans and British wanted to exploit it although an Iraqi said "its ours" however would you fly Iraq Air (if it exists) as I think it would be more dangerous than even "Binman" bearing in mind it would have an Iraq Flag on it which the US drones or USAF could mistake as a threat

Mind you prices would be cheap but as for landing in UK hmmm or maybe TG'S slots are up for grabs
colin 244