FMV loves a sweet low fare as much as anyone, especially this close to tax day. But last week's news that Ryanair and others plan to launch transatlantic service with fares as low as $12? Holy frijoles!
Who would have thought that one could cross the pond for a fraction of their passport fee? Some quick googling by FMV reveals that a $12 fare is in fact an order of magnitude less than the actual fuel cost a carrier must burn per passenger for that mission. What can this mean? Welcome to the wonderful world of revenue vs. fare. Breathe in and savor the subtle nuance.
You can rest assured that carriers will collect much more revenue than the $12 fare. Much of it is unavoidable, courtesy of various governments: taxes, PFC's, etc. Some of it is avoidable - but they do it anyways (like the "Wheelchair Surcharge" they charged ALL customers). However, FMV sees some fuel surcharges and other unavoidable "service fees" on the horizon as well. Think Ticketmaster fees on steroids. They've already confirmed optional value-added services fees - food, drink, duty-free, entertainment - so you can be sure others are in the works (e.g. baggage handling, seat assignment, etc.).
Not to be complete buzzkills, just as Megabus "gives away" $1 bus rides to select passengers, so could Ryanair. But not for everyone on the bus. Imagine the Travelzoo traffic when that Hot Deal is posted! One thing's for sure, new competition will certainly introduce some interesting new sales and marketing strategies. And dare we suggest, with launch markets like Islip and Baltimore, "You are now free to move about the planet?"
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