Tag Archives: air passenger duty

When flights to hub airports are still cheaper if you go indirect

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If you want to reach many destinations from regional airports like Birmingham, Manchester or Glasgow, you would expect to take a connecting flight through a major European hub airport.

But what about when you want flights to that hub itself? You would have thought that there would be enough capacity on the route for it to be cheaper to go direct with the airline which operates that hub facility. As it happens, the opposite is often the case, even when flights via that hub are cheaper than direct flights to the other hub.

Looking at flights to 10 hub airports served by direct and connecting flights from Birmingham, we found the following:

Hub airport
Airline
Direct £
Indirect £
Premium%
Airline
Via
Brussels Brussels Airlines 255 200 28 KLM AMS
Copenhagen SAS 208 151 57 KLM-AF AMS / CDG
Dubai Emirates 470 339 131 Swiss ZRH
Frankfurt Lufthansa 396 151 245 KLM AMS
Istanbul Turkish 183 161 22 KLM AMS
Munich Lufthansa 193 151 42 KLM AMS
New York Continental* 437 369 68 KLM-DL AMS
Zurich Swiss 193 161 32 KLM-AF AMS / CDG

Flight prices were searched using Expedia.co.uk for a 1 week trip (therefore including a Saturday night stay and often being cheaper), between 1st and 8th December. Only flights to Paris and Amsterdam were cheaper direct – hardly surprising considering how close they are, but Brussels still worked out more expensive to go direct.

Now these dates might be quite soon, but they are still before the mid-December Christmas rush. Looking forward to March next year, prices for direct flights to Brussels, Frankfurt, Munich and Zurich fell below the prices for flight connections.

This shows that the network carriers are still charging hefty premiums for direct flights. This seems to fly in the face of environmental concerns over short haul flights being the most polluting – and two short haul flights when one will often do being particularly bad for the environment.

The low cost airlines have shown that point to point routes are what the customers want, and that they shouldn’t need to pay for the privilege. Most low cost airlines actively shun transfer passengers, as if one flight is late, they don’t want to deal with missed connections, and their smallprint makes it clear that they are your problem, not theirs.

Yet, of the routes featured, none have a low cost alternative from Birmingham. At a push, you could fly to Paris with Flybe, and then take Thalys to Brussels, or if your dates were flexible, you could find a cheap flight to Geneva and then train it to Zurich.

So will the legacy airlines ever wake up to the idea that direct flights should be cheaper for them to operate, better for the environment, and therefore cheaper for the consumer? Not without a heft taxation penalty against them, and UK Air Passenger Duty is onerous enough as it is. In the meantime, they will continue to charge more for the convenience of a direct service, especially if there isn’t a realistic low cost alternative.

Notes:

  • *Continental dates were 2nd-9th December. No direct Continental flights found in March 2012.
  • AF = Air France, DL = Delta
  • AMS = Amsterdam, CDG = Paris CDG, ZRH = Zurich

Liverpool to Belfast – Flybe yield to Easyjet

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So Flybe have said that they are pulling out of their Liverpool to Belfast flights, and have come out with the predictable line about high taxes being the reason for the route being axes.

Now even though we agree with Flybe on this issue, it should be perfectly clear that the axing of this route is a simple case of them yielding to fierce competition from a larger rival. Now larger isn’t just about the size (and therefore the marketing clout) of the airline – easyJet were able to operate larger aircraft on this route at much higher frequencies. Flybe can often still compete against airlines that use larger aircraft, as they can offer better timings and higher frequencies, but on the Belfast – Liverpool route, they were only doing 3 flights each day, compared to 7 daily flights from easyJet.

Easyjet use Belfast International Airport, whereas Flybe use Belfast City, but even if this is more convenient for access to and from the centre of Belfast, Easyjet make up for this by offering a better frequency. Easyjet also have a much more natural customer base at both ends of this route, whereas Flybe have always struggled at airports like Liverpool and Bristol.

 

APD is not a green tax – told you so!

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As confirmed in our news story, chancellor George Osborne has admitted what we knew all along, namely that Air Passenger Duty (APD) is purely a revenue raising measure, not a green tax.

Finally Chancellor George Osborne has, albeit unwittingly in the form of a leaked letter, admitted that APD is “fundamentally a revenue raising duty” and currently raises around £2.5billion per year.
Mr Osborne’s admission that APD is nothing more than a tax grab came in a letter obtained by a national newspaper that he wrote to Olivier Jankovec, director general of the Brussels-based Airports Council International.

  • Do you think it is a green tax?
  • Do you think it should be revised up or down?
  • Do you think flights should be taxed in a different way?

 

How About High Speed 2 Wheels?

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For a long time, when asked about the need to reduce the environmental impact of aviation, my stock answer would be that transferring shorthaul flights on to high-speed rail services should be an obvious aim for governments. Yet, the more I have learnt about this governments high-speed two proposals, the more I have felt that it would be a very poor investment indeed, whether measured on economic or environmental grounds. Yes, having high-speed trains would shift some people from shorthaul flights onto less polluting rail services, but it has to be remembered that this big switch has already been largely made, especially on flights from London to Leeds, Liverpool and Durham Tees Valley, which no longer operate.

So if high-speed 2 is a bad investment, what would be a better investment? Obviously, any comparison between rail and air travel is about longer distance intercity journeys, whereas the vast majority of journeys take place within built-up environments, or are commutes between outlying towns and city centres. What if all the money collected from air passenger duty was actually put towards genuinely environmentally beneficial projects? Few things are better for the environment than high-quality off-road walking and cycling tracks, using existing historic transport corridors, especially disused railway lines. Yet, this can be done for a fraction of the cost of building new ones — the figure quoted by cycling charity Sustrans is that new cycle paths can be built for around £200,000 per mile, compared to the £155,000,000 per mile cost of high-speed 2.

Now, can these really be comparable, when high-speed 2 must surely carry far more people at much higher speeds? Yes, it might well do, but its entire business model is based on very ambitious estimates of user figures. Why put so many billions of pounds into such an inherently risky project? Whether high-speed 2 is viable or not (and we are certainly in the no camp), investing in better facilities for pedestrians and cyclists would still provide a much quicker win, both in terms of transport and human health.

Finding hidden cheap flights on Ryanair.com

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My brother and I have been talking about going to Morocco for a while, but we’ve never got round to booking. There’s an element of being cheapskates here, especially as Morocco is Ryanair’s only non-European destination, and it falls within the higher tax band. My cunning plan was to skip this tax difference by flying out through Gibraltar, and then taking the ferry.

This was as much about enjoying the journey as it was about keeping Gordon and Alistair’s mitts off my cash – sure, I don’t want them to have any more of it than necessary, but there’s no point in paying more for something just because you think it is taxed less.

So the Ryanair price ‘index’ isn’t quite down to zero at the moment – the confusing ’80% off our best fares’ doesn’t really mean much, when their cheapest fares are 1p – so are they now going to split the penny and offer me a flight for 0.2p? What the best deal actually meant was that the cheapest flights to Europe started from £3 – but their flights to Marrakech in Morocco were advertised at £34, from either Luton (much easier for my brother) or East Midlands (Coventry is fairly even between the two, but Luton is actually easier to get to on public transport).

So when clicking through to the results page, they have flights going down to £9.99, where the taxes and charges add up to £43, but they also have flights at just £10, and that is all you pay, full stop. Is this a glitch – I somewhat doubt it, that’s not Ryanair’s way of working. Is it a bargain – yeah, and return flights were also available a week later for just £10.

My brother had to get back to work a few days beforehand, and I have a concert to go to which made the £10 deal impossible. This is where Ryanair’s seemingly low fares suddenly rack up – the £9.99 flight working out at £45 with all the charges. So, time to head over to Easyjet to check out the price of that flight back from Gibraltar – £51 all in. For £6 more, I’m getting to enjoy flying out and back through different airports, and my Morocco trip should now include Casablanca aswell as Tangier. There will be a few extras for the train up to Tangier and the ferry to Algeciras, but for me that’s all part of the fun.

Happy travels!

*Note – ‘all in’ includes mandatory taxes and charges – in this case, I paid no fee for online check-in. Both of us are travelling without hand luggage, and I paid using my Co-op Visa Electron card.

7 Ways to Beat Air Passenger Duty Rises

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    Yesterday, Air Passenger Duty on short haul flights went up by £1, but much larger increases were imposed on long haul and premium service flights. These taxes are set to rise again in November 2010 – and even if a change of government looks likely, there is little to suggest that the Tories will reverse this policy.

    This list was due for a little bit more embellishment, which I’ll try and get round to later in the week, but in the meantime, here are the key suggestions:

    1. Take a Private Jet – you will pay no taxes at all this way.
    2. Let Michael O’Leary pay your taxes – can’t afford a private jet? Look out for Ryanair’s special offers when they pay the taxes for you.
    3. Island hop around Scotland – ‘public service obligation’ flights in the Scottish Highlands & Islands are exempt from duty – and the views are simply stunning.
    4. Take the ferry or Eurostar to Paris or Amsterdam, and fly long haul from there – or even hop over to any European hub on a budget flight, and then continue from there. APD stings you much harder on long haul flights.
    5. Offset the tax by saving on duty free, or not paying other airline hidden charges – ok, so the government sees air passengers as an easy target. Chill out, and enjoy some savings on duty free. The best deals might be at your destination – shop around to see, but even though there aren’t any duty free allowances on short haul flights to EU destinations, these aren’t the ones with the highest taxes. Why not get the best of both worlds and fly via Switzerland or Norway – short haul destinations which also have a duty free allowance. If you don’t have a Visa Electron card by now, then you really can’t whinge about air passenger duty if you are booking flights with a low cost carrier like Easyjet or Ryanair. The taxes aren’t usually avoidable, but the card handling fees always are.
    6. Go all the way by train- this is easier than you might think, and thanks to the new Eurostar links to the continent, you’d be amazed how far you can get in a day from London – and think how much more you see on the way. Don’t fancy a long journey home by train? At least the return flight won’t be taxed so badly, as APD is only levied on the outbound journey – Alistair hasn’t thought out a way of taxing people to come in to the UK yet, but don’t encourage him too much!
    7. Take the ferry to Morocco (from Gibraltar) – ok, so the ferry fare will cost you about as much as the tax you will save, but Gibraltar is a great place to land, and why not add a ferry trip to your African adventure?

    At last they admit it – flight taxes pay for bank bailouts

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    At long last, Chancellor Alistair Darling has said what we’ve known all along – that flight taxes (Air Passenger Duty) are used to sort out the dodgy banks, and nothing to do with the environment. Speaking to Northeast website The Journal last week, Darlin said:

    I am quite blunt about it, we need to raise money to pay for some of the things we have done. If unemployment goes up there is a cost obviously to the family, there is cost in increased benefits, Northern Rock has cost a lot of money.

    Now to be honest, no-one is going to step forward and offer their sympathy for the bankers, but many would still say that the bailouts had to be made in order to save the financial services industry. So, should airlines be made to suffer so another sector can survive?

    Well, Darling seems to think so:

    But if you think about it, what we are doing is putting a pound on to your average ticket, which about three quarters of people travel on. And you consider the cost of an air ticket, I don’t think a pound is that unreasonable.

    The problem of course is that it isn’t “just a pound” on the average flight ticket. Last year, air passenger duty was doubled overnight in a move which saw one of the few taxes to have been reduced under the Labour government get re-stealthed. To make matters worse and add insult to injury, taxes had to be collected on flights which were already paid for – as if the chancellor (and former transport minister) was more interested in act of vengeance than a fair tax. Of course, Mr Darling, as MP for Edinburgh Central, is a fully paid-up member of the “you shouldn’t fly but I will” brigade, and that’s long before we bring up the issue of MP’s expenses.

    Unlike some airlines and passengers, I don’t have a problem with air passengers paying their way through a ‘reasonable’ level of taxation – and I fully accept that the aviation industry must pay for its environmental costs. But let’s not forget that whereas motoring taxes are supposed to pay for the upkeep of the roads, usage of airports is already covered by separate airport handling fees levied by the (predominantly) private companies who run Britain’s airports.

    Environmental costs should be covered by a global carbon trading agreement, due to be discussed in Copenhagen next month. Of course there’s loads of other arguments about the benefits of switching passengers from short hop flights to high speed rail, but that’s for another time. Or maybe, if that’s where APD funds were being directed, the travelling public wouldn’t mind so much. Mr Darling, if you are reading this, that isn’t an excuse to double APD again on you’re next whim!