U.S. Airlines Could Regret Taking Billions More In Government Bailouts - Skift

Skift Senior Aviation Business Editor Brian Sumers writes this column with a critical eye on the important global issues impacting the airline industry, from the middle seat of the last row in economy class to the boardrooms of the world’s largest carriers.

Most U.S. airlines say they want, or at least are willing to take, tens of billions of dollars in new federal bailouts. But they may want to be careful about what they wish for.

Since deregulation, in the late 1970s, a sizable percentage of consumers have looked at airlines warily, with some accusing them of charging premium prices for service they could not deliver. They have complained as airlines reduced seat width and legroom, removed free meals, and invested in business and first class seats, at the expense of economy class. And some have been apoplectic as airlines have added, or increased, charges for ticket changes, luggage, and food and drink.

Most of these people were whiners. Yes, airlines indirectly receive federal government assistance  — those runways don’t build themselves — but they are independent, publicly traded corporations with a duty to extract maximum value for shareholders. Plus, consumers have undoubtedly benefited from deregulation, with airlines usually offering more choices at lower average fares, even adjusted for inflation.

But what happens to this consumer/airline dynamic if carriers take more federal money in a second round of CARES funding? Whether fair or not, we already know how consumers complain when they think airlines are nickel-and-diming them. We also know how lawmakers love to bash airlines when it suits their political needs.

Might consumers and politicians create even more unrealistic expectations for airlines after a second round of bailouts?

Think of the possibilities. Every time a passenger is denied something — a
Source…