Airlines Rampant Price Gouging for AFL Grand Final

Virgin actually dares to charge 2k for flights leaving Perth on Friday and back on Sunday or Monday. Why isn't there a public backlash on this?

Comments

  • +108 votes

    Because they can

    • +1 vote

      In before a Westpac Banker blames the government on putting too much regulations that causes the market to raise their prices during this weekend.

    •  

      Stick it to them and read the results the next day. Win.

  •  

    Putting the issues regarding how unethical you think it is, is 2k for a return flight the cheapest you can see for a return ticket?

  • +76 votes

    Supply and demand. Businesses may charge what they think consumers will pay.

    • -1 vote

      Sort of agree, but it doesn't necessarily mean it's right to do so in all circumstances. In fact, there are laws to prevent businesses charging what they want in certain markets and industries
      … not in this case though.

      • +41 votes

        It's a sporting event, not getting to a hospital.

        • -3 votes

          Yeah, I wasn't talking about the airline industry in particular, rather more generally.

          But this is an interesting case study nevertheless. I don't think all passengers travelling from Perth to Melbourne this coming weekend are going to the Grand Final. Indeed, there will be people travelling at short notice for all sorts of reasons. Who knows, some may be seeking specialised medical treatment.

        • +5 votes

          @tranter: Not on such short notice - that'd be emergency flights and there are still hospitals in Perth. For medical treatment maybe, but those are scheduled months in advance and wouldn't be affected by this. I just don't see this as an issue, really.

        • +2 votes

          @HighAndDry:
          Maybe but the truth is we don't know.

        • +1 vote

          @tranter:

          I book my flights (for business of course) within 2-3 days of flying.

          In any major event period we have a blackout so we don't fly.

        •  

          potentially people travelling to a hospital to see someone in hospice care
          A last minute but urgent flight
          people are not only travelling to watch the VFL final

          •  

            @UNFKNBLVBL: Potentially people may need to go to a strip club to get a raging boner to relief their cranial blood pressure that may have caused a aneurysm.

            (And seeing someone in hospice care isn't a necessity. It's a luxury that people have confused with a civil right)

  • +11 votes

    because not enough people care.

    • +20 votes

      Why? You don't have to fly with Virgin. In fact, you don't have to fly at all.

      • +1 vote

        But we do have the AFL grand final at the MCG until 2057. If the AFL wants the GF played in Melbourne each year, then they should arrange for additional flights for the game for interstate supporters via Virgin (office travel partner), who ironically has jacked up their prices the highest.

        • +1 vote

          Why? You don't have to go. You don't have to watch it. You don't have to use Virgin's services.

          •  

            @ronnknee: That argument doesn’t cut it especially if the practice of price jacking is considered anti-competitive. Which might or might not be the case here.
            Regardless, it reflects poorly on the airlines as there is a perception they are gouging customers.

            •  

              @gamemaster: It's really just supply and demand. Their supply is constant. Demand is up to us if we want to fly Virgin on those particular dates to that particular place. If no one wants to go, then it'll be cheap. If everyone wants to go, then the price will be high. It's not that hard to understand.

              •  

                @ronnknee: Sure, there is supply and demand argument and to an extent it controls the price. That is not my argument. My argument is the AFL should be ensuring sufficient supply of flights to the MCG for the GF to ensure the supply can meet the demand without the airlines opportunistically gouging customers. The AFL has gone ahead with a plan to play the GF at the MCG until 2057 so they should be responsible to ensure their commercial airline partner provide fights to meet the needs of interstate travelers to the game.

                •  

                  @gamemaster:

                  My argument is the AFL should be ensuring sufficient supply of flights to the MCG for the GF

                  Why though? The AFL has no obligation to get you or any other interstate fans to the match.

        •  

          Most airlines already anticipate the extra load and put up additional flights.

  • -3 votes

    As a comparison, my flights to and from Europe in a few days time cost me 1.4k.

    •  

      So tell me, how many people in Australia really want to go to Europe on that day? Is it far more than usual or similar to most other days?

  • +11 votes

    Why isn't there a public backlash on this?

    People complain everytime.

  • +25 votes

    It's a business not a service. If people pay it, why does it concern you? If they are making too much money, go to the trouble of starting an airline yourself and get in on the action you pleb, capitalism 101… It's the reason there is an airline in the first place

    • +2 votes

      Actually, what you say here "go to the trouble of starting an airline yourself and get in on the action you pleb, capitalism 101" aka a huge barrier to entry is one of the reasons a government would force a company to reduce their prices.

      Not relevant in this case, but you don't make a very convincing point.

      • +6 votes

        Forcing a company to reduce prices is a short term solution that doesn't actually increase the supply of the product that's in high demand… in this case, prices will be low for those lucky enough to get in early but people will miss out. Perhaps those who want it bad enough will end up paying 2K or more by buying a ticket from those who got in early anyway haha

        If you want government intervention, get the government to incentivise competition and make it easier to access money from venture capitalists and cut red tape, so that starting and maintaining an airline becomes easier (this is actually, technically, LESS government intervention lol).

        But tax breaks for businesses are never popular with the political left…. mostly because they are too short sighted to see how it actually helps them. I'm not saying it's always a good thing, but sometimes it is; in this case it is.

        Problem with society today is that people are entitled. This whole post comes from an entitled mentality.

        • +3 votes

          Lol. Neg me if you want, but you can't argue with the truth ;) Even if it's presented as arrogantly as I have just now ;)

        •  

          Helping start and maintain airlines is no guarantee of sustainability. Look at how many airlines have already collapsed. Or even look at other industries like automobile.

          With such a small population and large area like australia its not feasible to have airlines on standy or redeploy existing planes for rare 2-3 day peaks like grandfinal day.

          Airlines have no justification for increasing prices that much (its not costing them anything more for demand) and prices typically scale up in realtime as people full up seats.

          All this hike is doing is guarrenting that the well-off can get a seat. The opposite of elitism is not entitlement!

        • +1 vote

          @The Wololo Wombat: I must have missed the arrogance part in your post. :)

        •  

          @CocaKoala: Speaking about anything in absolute/certain terms come across aroggant to many people :)

    • -5 votes

      Not that I care, but air travel is quite heavily regulated, this is a short term price hike, and it's a move thats likely to encourage similar behavior among competitors. None of these points are particularly compatible with capitalism 101. You just don't give a shit because you can't see it ever affecting you

      • +4 votes

        None of these points are particularly compatible with capitalism 101.

        Higher demand —> higher prices.

        You literally can't get more capitalism 101 if you tried.

        •  

          Have you heard the term 'free market'?

          What do you think the 'free' part refers to.

        •  

          @outlander: wait, that's not a joke that everything should be free is it?

        • +3 votes

          @outlander: Virgin is "free" to set any price they want and you are "free" to pay it or use a competitor.
          That is how a "free" market self regulates. If Virgin can’t fill the seats because their competitors are under cutting or there isn’t enough demand then they will reduce the price.

  • +14 votes

    Its called supply and demand… you could have booked earlier… but then again you probably wanted to see if your team was in the finals… just like everyone else

    I want to go to Bali in December.. just like everyone else… prices are 3x normal

  •  

    Call the ACCC.

    Better yet, find someone that will actually do something… lol

  • +7 votes

    I'm looking forward to a similar observation being made around December 25th

  • +3 votes

    The logistics and short term costs to the airlines are massive. Larger capacity aircraft, additional crews etc do not come cheap.

    Not denying they maybe adding some cream to their profit margin but it is partly justified.

    • +2 votes

      The airlines are private businesses so should be able to charge whatever they want, but don't pretend this is anything other than them seeking as much money as possible. It's not to cover additional costs.

      •  

        There are probably some. Fixed costs don't usually get factored into normal pricing, but when capacity needs to be increased drastically, the marginal cost for that additional capacity for things which are previously fixed costs are significantly higher - e.g. penalty rates for staff, and the rates required to attract additional staff, will be far higher than normal wage rates.

  • +6 votes

    Why isn't there a public backlash on this?

    You don't have to fly with them you know. You can drive or find some other alternative if you're not happy.

  • +9 votes

    How dare they raise their prices according to supply and demand.

    How dare AFL charge $4100 for an Ultimate AFL Grand Final package as well. They should just charge $50, so everyone can afford it.

    Supply and Demand only works for the rich. Price caps on everything please! We need government legislation on everything.

  • +7 votes

    Back your team and book flights weeks ago. If they miss out it's a great time to be in Melbourne regardless.

    • +2 votes

      We did exactly that. We are on holiday in Sydney and six weeks ago and booked flight from Sydney for thte weekend. Other friends booked flexitickets at $800 perth to Melbourne at the same time. This meant they could change their dates for a small fee if the eagles did not get into the final. It all paid off.

  • +2 votes

    Forget the football, fly to Europe.

  • +9 votes

    Yeah it's like they're trying to make money or something

  • +8 votes

    Newsflash: roses are also jacked up on Valentine's Day, and Ubers are more expensive on New Years Morning.

  • +2 votes

    we need hyperloop

  • +8 votes

    Move to the east coast, then you can drive.

  •  

    Vigin fly to Hobart now, maybe try flights via there.

  •  

    Could always start your own domestic airline and show them how it's done?

  •  

    Airfares vary by the minute as airlines try to match capacity and demand via sophisticated yield management algorithms.

    Mostly we have benefited hugely from this, as I am still paying the same fares in dollars as I did over 20 years ago for almost all of my travel.

    The flip side is that fares will increase if lots of people want to go somewhere at the same time with no date flexibility. For example school holidays, or Xmas or … the variations are not as extreme as for the GF, but they affect a shitload more people.

  • +12 votes

    During off-peak seasons they are heavily discounted. Where is the public backlash to that?

  • +3 votes

    As has been already mentioned it is supply and demand, though there is a flip side to this which is of huge benefit to you…… choose to fly on a different day or even a different month and the flights will be much cheaper than they used to be years ago when rates were fairly fixed - doesn't help for the Grand Final of course.

    Want to go on holiday somewhere, watch the OzBargain forums and snap up the $900 LAX flight, this sort of pricing never used to happen….. all flights were expensive period.

    In all honesty I prefer flight pricing the way it is, I can make snap decisions to fly to New Zealand when tickets are cheap etc etc.

  • +5 votes

    Surely the alternative is keep prices unchanged and then have everyone whine that there are no seats / hotel rooms /tickets available as they all sold out in one minute.

  • +9 votes

    Think about it. The extra demand from East to Perth is zero, so they will be sending an empty plane to Perth to pick up the supporters. Fly the supporters to Melbourne then the aircraft wait 6 - 8 hours for the supporters so they can then fly them back to Perth. Then fly the empty aircraft back to its base in time for the Monday shuttle services.

    The pricing model for airlines is to try and fill the aircraft on all legs of travel with minimal turnaround time.

    $2k might be a little over the top, but not excessively.

  • +1 vote

    Do you complain when there's nobody else on the Plane & you only paid $189 to go to Singapore too?!

  • +1 vote

    Airline fares tend to be grouped in 'buckets' according to their fare class. When the cheapest fare buckets sell out, then the next cheapest ones will show up and so on.

    For Virgin Australia:

    The cheapest are 'Getaway' fares, you can find $199 from Perth to Melbourne. These would have been long gone.
    The mid-tier fares are 'Elevate', these are about $300+ from Perth to Melbourne. Also long gone.
    What's left are the most expensive 'Freedom' fares, fully flexible. From $650+ Perth to Melbourne, and gradually increase as they sell out.

    Qantas are similar, just different names for the categories.

    So really the airlines aren't 'price gouging' as such, but they have set fares for each flight and as each fare bucket gets cleared out, it goes to the most expensive ones.

    Yes, a full-price Economy ticket can sometimes be pricier than a sale Business class ticket, and I've seen a few situations where that's the case.

    • +1 vote

      Airlines are adding extra flights on the weekend so not sure it's the traditional pricing structure.

      Tickets are pricier because of crew and aircraft relocation costs. Probably a level of price gouging as well.

  • +1 vote

    Don't like it? Vote with your feet. Boycott Virgin (and any other airline doing this).
    Cut up the AMEX, (profanity) the points.

  •  

    Virgin "dares" to blah blah blah

    They are a private corporation, what, are they supposed to be scared of you op? LOL

  • +1 vote

    Don't you understand anything..it's ok for airlines to price gouge and the AFL clubs to sell tickets at 20 times their value by attaching a fancy breakfast package but when the average citizen who wants to sell his GF ticket fora profit, thats scalping and frowned upon!

    •  

      The average citizen could buy dozens of concert or sports events tickets and then resell them at inflated prices. That is the key difference.

      • -2 votes

        You might want to rethink that thought, because it doesn't sound like you thought it all the way through the first time

    • +1 vote

      I personally also don't think there's anything wrong with scalping. You bought it, it's yours, you can sell it.

    •  

      Interesting question if you can scalp a ticket by adding a box of Nutri Grain and a meet and greet with the Narre Warren Under 12 best and fairest and calling it a finals breakfast package.

  •  

    I don't see an issue with it. Surely if you run your own business or are in management, you may also 'dare' to do the same.

  • +3 votes

    Supply and demand. Suddenly there's maybe 10,000 people competing for maybe 2000 seats on available aircraft. If you're running an airline, do you keep prices the same or do you raise them knowing demand far outstrips supply?

    In other news, I'm upset that airlines price airfares high on Saturday morning and the return airfare on Sunday night. It's so unfair, I expect the same rate across all days and times. /s

  •  

    Drive or watch it on tv…

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