Airlines are Not the Only Companies Taking Advantage of Lower Fuel Prices

N umerous complaints have been posted at what seems to be countless weblogs and Internet bulletin boards decrying how airfares have not been reduced and fuel surcharges hidden or not eliminated despite the recent significant drop in crude oil prices — but airlines are not the only companies benefiting from what appears to be a form of arbitrage with fuel prices.

I personally have yet to find a company — other than gasoline stations, of course — which has lowered the prices of its merchandise or services in response to lower fuel prices. I have noticed that some shipping companies and garbage hauling services have removed fuel surcharges from their billing statements; but that seems to be few and far between.

One example is a supermarket, which is dependent primarily on trucks to deliver goods to be sold at it — as do the companies which supply food for supermarkets and restaurants to sell. Prices for many goods soared — and the quantity of some of those good shrank — immediately when fuel prices increased significantly; but I personally have not seen a decrease in prices on those goods.

At the supermarket this morning, a loaf of French bread was purchased at the bakery. The size of it had not increased; and the price had not decreased. In fact, the bread was actually smaller this morning than when a similar one was purchased last week. Tomatoes are currently four dollars per pound. I can only purchase citrus juices which are not from concentrate at two containers for six dollars whenever there is a sale — they used to be two containers for four dollars — and the size of the containers are 59 ounces instead of a true half-gallon of 64 ounces. One brand of ice cream which once sold half-gallon containers today sells its product in containers which have a capacity of only 1.5 quarts.

Then again, there are airlines which have been cutting back in seat pitch, benefits, and flight schedules — only yesterday was it confirmed that Delta Air Lines will no longer distribute Have One On Us coupons effective as of yesterday; and with no announcement — without lowering airfares.

Remember when hotel properties implemented energy surcharges to cover rising utility bills back in 2000 — often without advance notice to you, the guest? Some hotel properties even charged a fee just for having a telephone in your room — whether you used it or not. Lawsuits against lodging companies were filed. The result was that lawyers were paid handsomely; while you were offered a coupon. Whoopie.

Even worse is that when it comes to ancillary fees in general, they are even more difficult today to have removed than ever. There was a time where if you questioned a charge on your hotel bill, it was usually removed immediately without question. I suppose that companies are betting that you will not believe that it is worth the time and effort to contest charges on your bill these days; and if that is indeed the case, that is pure profit for them…

…but then again, I will pose this question to you: if you are operating a business where you increased prices for your goods and services and people are paying them, would you pass on any savings to your customers when your costs are reduced — such as with fuel prices? Should airlines — and other companies — pass on reduced costs to their customers?

3 thoughts on “Airlines are Not the Only Companies Taking Advantage of Lower Fuel Prices”

  1. Delta Points says:

    Don’t forget due to Delta’s VERY poor fuel hedging it will cost them a TON of money this Q. So much so it is impacting results. How could they lower prices when their own choices are costing the company so much money. Guess they will have to add another fee or up-sell to cover the cost of the fuel prices going down. Oh wait – inflight will make a bunch more now selling drinks – there you go! 🙁

    1. Brian Cohen says:

      You would think that a company which owns an oil refinery would do a better job of fuel hedging, Delta Points

      1. Delta Points says:

        WoW. Yes. You would think. But you would think a company who runs an airline would not come up with Skymiles2015 but they did that too! Just say’in! 😉

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