There are real consequences to corporations constantly consolidating, and becoming de facto monopolies in particular markets. Cable/internet companies are one such example, and so are airlines. Most routes are served by one or two airlines, so there isn’t a push towards lowering ticket prices to capture market share. Instead, the airlines just give executives big bonuses…
Helped by falling oil prices, airlines are reporting record profits, but for many passengers this sudden bonanza has meant little more than extra bags of free peanuts and pretzels.
The four biggest domestic carriers — American Airlines, Southwest Airlines, Delta Air Lines and United Airlines — together earned about $22 billion in profits last year, a stunning turnaround after a decade of losses, bankruptcies and cutbacks. A big reason for this is the plunging price of jet fuel, which now costs only a third of what it did just two years ago.
But that windfall is only slowly finding its way down the aisles. Days after reporting record profits, for instance, two of the nation’s biggest airlines brought back free snacks in coach.
United said it would begin serving complimentary stroopwafels, which it described as “Dutch-made toasted waffle treats,” and American said it would offer free meals in economy class on flights between Dallas and Hawaii, and free snacks on all domestic flights.
Airfares, however, have remained stubbornly high.
(click here to continue reading Airlines Reap Record Profits, and Passengers Get Peanuts – The New York Times.)