Air Cargo Price Fix Probe
A Set Up?

Dear Geoffrey,

     This situation should not be seen as just with BA as the villain.
     Perhaps, with a history of disagreement between them, BA should be seen as foolish in ever talking to Virgin who again have scored a very cheap point against BA.
     It should be seen as BA as the victim.
     From my experience most airlines have been applying a similar, if not the same, surcharge on the same day since they started.
     This suggests that there was and is some understanding between them.
     This does not appear to be a problem to me if the fuel costs were the same for each airline and they were all buying on the spot market.
     Surely airlines have contracts in place.
     But then why the resistance to include the extra cost of fuel within their rates and fares?
     One airline representative told me it was their desire to be 'transparent'.
     If that were to be the case every element of their cost should be declared separately which is something that would be unacceptable.
     Surcharges should be temporary and set for a month, a quarter or for a maximum of a year and then accepted as core costs and the rates/fares adjusted.
     The industry has done itself an injustice and BA has suffered financially whilst Virgin must surely be the biggest and sorest loser!

Colin Sullivan UK

     That Virgin reportedly can’t stand British Airways and vice-versa (in public at least) is probably one of the better-known aviation stories.
     So maybe what happened here is that BA was set up?
     Your point, that surcharge business is business as usual, has not been bought into by law enforcement.
     Part of the problem is that the agents in many cases are left holding an empty bag, while airlines charge almost zero rates indicating to their service partners that they are satisfied to continue to do business while receiving little more than surcharges that agents get nothing of as recompense.
     Thinking about that business model for a moment, we should have expected that law enforcement would enter the air cargo kitchen at some point.
     We also should not be surprised to eventually learn that a driver for these investigations might have also come from the agents.
     An old axiom can be employed here:  "Nobody like to get stiffed.”
     Clearly something else has to happen.
     IATA Cargo or Cargo 2000 should call an emergency meeting, include the service partners and invite the press in with everybody at least advancing some new ideas for a better way to do business.
     The invitation should say: No more “business as usual” advocates need apply.
Geoffrey