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Transportation United Kingdom

British Airways Owner Warns Airfares Must Rise To Fund Carbon Cuts (ft.com) 86

Airlines in Europe will be forced to raise prices to fund the cost of cutting carbon emissions, the boss of British Airways owner IAG said. From a report: Luis Gallego told the Financial Times that switching to cleaner, more expensive sustainable fuel would "have a big impact" on the industry [the link may be paywalled] and put some people off flying. "Flying is going to be more expensive. That is an issue, we are trying to improve efficiency to mitigate that, but it will have an impact on demand," he said. He added that European airlines could become less competitive because of the bloc's tough net zero targets, which include a requirement for 6 per cent of jet fuel to be from sustainable sources by 2030.

"We agree with decarbonisation ... but I think we need to do it in a consistent way worldwide not to jeopardise European aviation," Gallego said. Sustainable aviation fuel (SAF) is made from a range of non-fossil fuel sources, from waste cooking oil to crops, and can emit 70 per cent less carbon dioxide than traditional jet fuel. But very little of it is being produced -- less than 1 per cent of total aviation fuel consumption last year was from sustainable sources -- meaning it is far more expensive than jet fuel. IAG itself used 12 per cent of the world's SAF last year across its five airlines, which include British Airways, Iberia and Aer Lingus.

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British Airways Owner Warns Airfares Must Rise To Fund Carbon Cuts

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  • Business (Score:4, Insightful)

    by The Cat ( 19816 ) on Friday July 05, 2024 @11:55AM (#64603165)

    Isn't business supposed to make things more efficient, less expensive and higher quality? Isn't that the constant improvement philosophy we hear so often?

    It has to be. It's the justification for every round of brutal arbitrary layoffs.

    Yet, for some reason, things seem to be getting less efficient, more expensive and lower quality.

    Funny.

    • Comment removed based on user account deletion
      • when Airlines are prohibited by loans with ESG covenants or government regulations to never ever fly any airplane which has less than 90% of the seats sold.

        Same for trains, busses, ....

        A 2017 interview with BlackRock BLK CEO Larry Fink has resurfaced in which he stated he wanted to force diversity and inclusion policies on companies. The quote has sparked outrage within conservative circles and debate as to the role of investment funds in the broader ESG conversation.

        https://www.forbes.com/sites/j... [forbes.com]

        • Comment removed based on user account deletion
          • It's the financial elite pushing their own political policies on companies taking out loans.

            The fact that it is ESG forced on a company via a loan agreement is the point in question.

            How far different is this from you as an individual taking out a car loan and the bank putting a requirement in the loan that your interest rate will go up 1% if you do not 'volunteer' 100 hours a year at a political organization whom you do not agree with.

            Once the gates are open to force political behavior and force speech on c

      • The way the whole industry is setup is a big source of overall ineffeciencies, while efficency of individual corpos taking a fee on the chain has gone up.

        They don't make the planes, they don't even own the planes. They don't own airports. They don't have their own IT. A lot of them don't even have their own staff.

        The amount of workers on the chain has gone down, while the amount of owners and management in the chain has gone up.

    • Yet, for some reason, people seem to be ever more ignorant about Greed, regardless of thousands of years of human evidence.

      Funny.

      FTFY. And no. It’s not funny. It’s fucking pathetic. It’s so fucking pathetic that it will be the epitaph of the human race, and we’re too stupid as a species to prevent it.

      We can’t even prove we haven’t been THAT stupid in the past.

    • You're placing an artificial restriction on them - if they were free to operate as they see fit the prices would continue to go down.

      I don't know about British airlines, but the reality is that most US airlines are already barely scraping by. If you look at most of them if not for credit card partnerships (for loyalty points/miles) most of them would already be operating at a loss. Basically the tickets are already not funding operations and are being subsidized by those credit card partnerships. And eve

      • Re:Business (Score:5, Insightful)

        by smooth wombat ( 796938 ) on Friday July 05, 2024 @12:39PM (#64603305) Journal
        You're placing an artificial restriction on them - if they were free to operate as they see fit the prices would continue to go down.

        Bullshit. Show one time when a business was allowed to operate freely and prices went down. This is the same crap we hear when a company buys one of its competitors, prices will go down (or won't be affected) because of efficiency. You know, like the cellular companies in the U.S. and the price of service.

        It's the same thing when the discussion about raising the minimum wage comes up. Prices will go up. Unlike prices going up without raising the minimum wage.

        There's a reason corporate profits are at a 40 year high, and it has nothing to do with supply chain issues or rising wages.
        • Re:Business (Score:4, Informative)

          by LazarusQLong ( 5486838 ) on Friday July 05, 2024 @01:17PM (#64603433)
          regrettably, most seem to be too stupid to see this. One thing that always boggles my mind is when a ceo makes stupid decisions and fires, er, uh, yeah I am sorry, the politically correct term is 'lays off' though that isn't really the case, a bunch of pleb's and then gives 100x their salaries to all the top level exec's and 100x their salaries to him/her self, then the company goes out of business and some other set of morons, er, uh, I meant Board hires him/her to run their company... WTF? can they not see that that idiot ran the other company into the ground? Are they too stupid to realize that the people laid off are, many times, the people actually making the product or service that the company is purported to make/provide?

          Sorry...

          /end rant

          • by AmiMoJo ( 196126 )

            Of course they can see it, but as you note the board members of the previous company got their massive bonuses. The fact that the company went bust is immaterial, the right people got paid.

          • 'lays off' though that isn't really the case, a bunch of pleb's and then gives 100x their salaries to all the top level exec's and 100x their salaries to him/her self, then the company goes out of business and some other set of morons, er, uh, I meant Board hires him/her to run their company... WTF? can they not see that that idiot ran the other company into the ground?

            Ah. I see where the confusion lies. You think the business has any inherent value in and of itself. It does not. A business is merely a way of funneling money into pockets. What the business actually does is irrelevant, it is all about how it can be converted into cash, right now.

            So a group of investors sees a CEO completely trash a business and cause thousands to lose their livelihoods. That sounds very bad... but how much money did the investors in the previous business make? Over 50 years, they made 500

        • by DarkOx ( 621550 )

          meanwhile in reality land...

          If we inflation adjust (an in some cases without). The cost of fuel (petro chemicals anyway) is quite low compared to say 50 years ago, clothing is cheaper, most entertainment is cheaper - a movie rents for the same 3.95 or so it did 30 years ago.. If Walmart sells it, whatever 'it' is probably cheaper.

          The things that actually cost more than they used to when I was a kid are almost entirely things where the government and regulators have put their filthy little hands on the scal

          • meanwhile in reality land...

            If we inflation adjust (an in some cases without). The cost of fuel (petro chemicals anyway) is quite low compared to say 50 years ago, clothing is cheaper, most entertainment is cheaper - a movie rents for the same 3.95 or so it did 30 years ago.. If Walmart sells it, whatever 'it' is probably cheaper.

            The things that actually cost more than they used to when I was a kid are almost entirely things where the government and regulators have put their filthy little hands on the scales.

            Fuel used to cost me $0.75 a gallon in 1998 which is $1.43 in 2024 dollars. Today gas prices average over $3. Movie tickets were around $4.69 which is almost $9 in 2024 dollars whereas movie tickets today are currently $10. Healthcare prices have risen over 100% since 2000, from 5% of GDP in 1962 to 17% in 2022. Modern houses are shit quality compared to older homes and are insanely more expensive.

            Other goods may well be cheaper these days, but they're also lower quality shit that is made to be thrown aw

        • > Show one time when a business was allowed to
          > operate freely and prices went down.

          That's easy. Go back to the "Wild West" days of tech. If you will recall, there were a bunch of "hands off" laws at the federal level prohibiting the states (and the feds themselves, at first) from taxing tech companies in general, specifically preventing them from taxing out-of-state online retailers, and, in general from sticking government noses into tech's business at many levels. Actual price *reductions* were

          • *facepalm*. I fat-fingered that one.

            ... a *LOT* more, at any price point you choose, in 2008 versus 1998. That's effectively a decade and longer of continuous price drops coinciding with very (As much as we love to hate on the DMCA and everyone associated with it.) light regulation.

            Compare that to the more recent years when the feds abandoned that "hands off" approach and now internet services are being taxed at several levels, states are allowed to tax internet retailers in other states now, even when th

        • "Show one time when a business was allowed to operate freely and prices went down. "

          You are obviously too young to remember when air travel was tightly regulated. Fares were much higher in inflation adjusted dollar. Airline could not complete on price, so they competed with perks like much fancier meals and service.

          But airlines were eventually deregulated, air fares came down and all the perks went away because the cheapest fares became all important.

        • Bullshit. Show one time when a business was allowed to operate freely and prices went down.

          Well, when Capitalism is allowed to actually operate, prices do indeed come down. When the field is so full of regulations that companies without wealthy backers seem to fail, then regulation is not serving the purpose it is supposed to be serving. Essentially, regulations have been used to strangle the market down to one player in a vertical segment, with LOTS of segments artificially being limited to one segment through regulation. It is an utter fucking mess where Capitalism with a capital C is nowhere t

        • Are you kidding? Air travel when it was highly regulated was basically reserved for the rich. People dressed up for flights like they were sailing on the Titanic. Nowadays? I just checked a ticket from my hometown in South Carolina to Philadelphia and I can fly there and back for 38 dollars. Thirty, eight, fucking, dollars. Round trip.

          Yes, everything will cost extra, and the seats are cramped, but deregulation and hyper competitiveness have driven airfare prices through the dirt. Like I mentioned man

      • So how come as items move down the supply chain the 'markup' is 10- to 300% otherwise the item is 'not worth stocking'
        • Depends on what they item is. If its something that rarely sells then the shelf space has to be justified via higher margins, but on stuff that is rapid turnaround, frequently purchased (think eggs and milk) the markup is often minimal, and the largest retailers do their very best to eliminate most of the supply chain to remove as many markups as possible to get the lowest price.

          I had the same argument with a co-worker a while back. Constantly complaining about Wal-marts terrible business practices and ho

    • A business is created to make money for the owner. What you are describing is the result of competition, which has been almost completely eroded by mergers and acquisitions between the owners.

      The end game of our current world economy is one company that owns everything and barely feeds the slaves to keep it going. Sorry I meant employees.

      Same fiefdoms everyone fought hard for centuries to break , but now in the form of a business name with shareholders.
    • by Bert64 ( 520050 )

      Isn't business supposed to make things more efficient, less expensive and higher quality?

      More efficient and less expensive absolutely, but it's supposed to use those gains for increased profits, not pass them on to the customers.

      Higher quality on the other hand is rarely a goal, often lower quality products are the aim because they have better margins and need to be replaced more often.

      Businesses are designed to make profit, everything is working as designed.

    • by guruevi ( 827432 )

      Yes, because this isn't business, but government getting involved. If government gets involved, things get less efficient, more expensive and lower quality. Not funny, fact.

    • by hey! ( 33014 )

      In economic models, companies compete against each other for dollars spent by economically rational customers who have perfect information about the products on offer and prices. Given the conditions that prevail in these models, the free market is a perfect mechanism for allocating resources and goods.

      In the real, if you've ever worked in any kind of moderately senior position of a company, you realize that a lot of a company's energy goes into undermining those conditions. To the degree legally permitt

    • Don't conflate business efficiency and cost with suddenly being forced to recognise that your externalities cannot be accounted for. Flying is cheaper than ever. The cost of a short ticket is now dominated by taxes and airport fees. And yet still no one adds the actual cost to the environment of our wasteful practices onto the ticket flight, which is why it's still more expensive to catch a train from Paris to London than it is to fly.

    • Government regulations often have the reverse affect.
    • Yet, for some reason, things seem to be getting less efficient, more expensive and lower quality.

      Funny.

      Capitalism died around the 1950s. We fought Fascism so hard that we became the Fascists. Funny how that works. It will take a potentially world-ending scenario to shake things up again. I am not looking forward to it.

      Don't believe me? Look at how Boeing, the USA's premiere high tech company is embroiled in legal battles and produces nothing but shit. That is what happens when Capitalism with a capital C dies. We will support that corrupt company until it dies with us (it can't fail. It is the best aerospace

  • It's much more sustainable to travel by donkey cart.

    • Jackass in front and in the cart
    • Re: (Score:2, Funny)

      by Anonymous Coward

      It's much more sustainable to travel by donkey cart.

      Maybe not. Have you looked at the methane emissions from the donkey? Let alone the number of donkeys you would need to sacrifice into the Atlantic to make a bridge to cross the pond.

    • I think the donkey would get worn out pulling the cart across the Atlantic, sink and drown. now, where would that leave you? Shark Food?
  • by killfixx ( 148785 ) * on Friday July 05, 2024 @12:02PM (#64603189) Journal

    And, they'll continue to get govt. handouts to keep them afloat. Corporate welfare at it's best.

    • by taustin ( 171655 ) on Friday July 05, 2024 @12:35PM (#64603297) Homepage Journal

      Go read up on the number of horses that were in use in New York City [substack.com] prior to automobiles becoming widespread.

      In 1894, it was estimated at 150,000, producing three 1,500 tons of manure per day, plus 40,000 gallons of urine. There was also the issue of thousand of horses keeling over dead every year, and their owners tendency to just leave them for the city to haul away, and the outbreaks of typhoid and other diseases caused by 40-60 piles of horse manure.

      The introduction of the automobile significantly improved the air quality in big cities.

  • My family lives 1100 miles away. At 45mpg and 140 pence per liter, it would cost me about 310 GBP for a round trip. Perfectly acceptable and with no luggage restrictions. Sure, it's a 19h drive, but I enjor road trips.

    • but I enjor road trips.

      I've done proper road trips. Start from Los Alamos, NM, up to Santa Fe, follow historic 66, past the Hoover Dam, Vegas, national parks, route 1, more national parks, some nuclear torurism at white sands and back home. All with a yokel rear license place (only the rear needed in NM) and rolling into town and finding a motel etc etc.

      UK road trips are less good. Starting from London is bad. The roads are smaller and busier and harder to drive. Motels aren't a thing. You can find National

  • by Alain Williams ( 2972 ) <addw@phcomp.co.uk> on Friday July 05, 2024 @12:43PM (#64603321) Homepage

    Make air travel more expensive to discourage people from flying. We need to change how we behave to reduce emissions; reducing jet-setting is part of it along with better insulating our home, etc. British Airways are putting profits before planet.

    • What a load of elitist crap.

      Do you even hear yourself saying this out loud?

      The "jet setters" don't travel on airlines like us plebs do, they have their own planes -- either bought, or hired.

      Can't wait 'til all this green hysteria washes over just like it did in the 80's, after the 70's radicals were voted out of office.

      • The 2nd division jet setters travel first class on commercial.

      • The "jet setters" don't travel on airlines like us plebs do, they have their own planes -- either bought, or hired.

        Sorry kiddo, but that is horseshit. Private planes account for a tiny pittance of the carbon emissions that general purpose passenger airlines do. We all like claiming the rich are the sole problem. Fuck them they are rich, they should pay, they are destroying the ... oh look TUI is offering bargain holidays to Tunisia *buy buy buy*.

        The overwhelming majority of carbon emissions are the result of leisure flights. Business flights make up 12% of global flight seats. Private flights a fraction of a percent. Bl

    • by Bert64 ( 520050 )

      Businesses always put profits before planet, their sole purpose is to generate profit for their owners.
      Trying to reduce air travel would be a terrible way to operate an airline, and start a shareholder revolt.

    • by DarkOx ( 621550 )

      Probably part of the solution ultimately.

      The political left needs to deal with its internal denial-ism, on this subjection. Globalism is fundamentally incompatible with 'Green'.

    • by PPH ( 736903 )

      Suits me. Raise prices not only to recover carbon costs, but to keep the passengers wearing flip-flops and stained wife beater t-shirts off the plane.

    • Agreed, let us begin by forcing the true jet-setters, those that fly private, to buy sustainable jet fuel only. After production levels of sustainable jet fuel meet the consumption levels of private jet travel, expand the requirement to commercial. That would also include government officials traveling to things like Davos on private jets. And just to be clear, I mean any private jet that lands in an airport in the west would be filling up with sustainable jet fuel. Even if it came from say SA.
  • https://www.theguardian.com/bu... [theguardian.com]
    "IAG reported an annual profit of €2.7bn (£2.3bn) after tax, on operating profits of €3.5bn (£3bn), with high fares and premium leisure travel compensating for smaller numbers of business travellers."
    But sure, customers need to bear the brunt of the cost to go clean.

    • by rskbrkr ( 824653 )

      https://www.theguardian.com/bu... [theguardian.com] "IAG reported an annual profit of €2.7bn (£2.3bn) after tax, on operating profits of €3.5bn (£3bn), with high fares and premium leisure travel compensating for smaller numbers of business travellers." But sure, customers need to bear the brunt of the cost to go clean.

      They also happened to have a net loss of $6.9 billion in 2020 and $2.9 billion in 2021...

      • by Tebriel ( 192168 )

        They also happened to have a net loss of $6.9 billion in 2020 and $2.9 billion in 2021...

        In the middle of the pandemic, yes. So did a lot of the world.

  • The goal is to reduce greenhouse gas emissions overal. There is only one atmosphere. Tax all fuel and all activities based on there equivalent to CO2 release into the environment. Let the free market figure out how to reduce the emissions. Don't have different taxes and rules for different activities and never have the government tell us how to do it. And get rid of the subsidies and market protections. The final consumer has to pay the tax so that they will substitute for cheap/cleaner alternatives. If the economy can reduce emissions more per dollar by changes to how cows are fed than requiring ethanol in gasoline then market prices will do that. If Tayor Swift will generate 20 million in economic activity by flying in a private jet she should fly in a private jet.
  • "Business owner complains about costs of overheads & says he may have to put up prices."

    We've never heard that one before, right?
  • I believe this is the same story, just not behind a paywall: https://oilprice.com/Latest-En... [oilprice.com]

    What happens if some politicians run on a platform that includes no more carbon taxes? I believe that could be popular because people like lower taxes. No nation taxed themselves into prosperity. What if such politicians get voted into office? Then the people have spoken, and the people say they don't want carbon taxes.

    It's not impossible to have both lower taxes and lower CO2 emissions. There's incredible dem

    • They want lower fares as much as they want lower taxes, leaving it to the market means just heading to systemic collapse from warming.

      Not that we are not heading to systemic collapse for a couple other reasons, so it really doesn't matter much ... but the market clearly won't do shit for emissions till we run out of fossil fuel.

      • ... but the market clearly won't do shit for emissions till we run out of fossil fuel.

        Clearly that's not true.

        As fossil fuels become scarce the costs will increase for extracting them and refining them into aviation fuel. We have carbon neutral aviation fuel already available on the market for those willing to pay for it. At some point the cost of fossil fuels will reach that of the carbon neutral alternatives and everyone switches to the carbon neutral alternative because it costs the same but emits no CO2, then once that happens economy of scale should take over to lower costs of carbon

  • This is no different than burning forests in old coal plants ... just accelerating towards the cliff to supposedly meet emission cuts, they just want preen with the imaginary numbers at their soirees.

  • The solution is easy. Electric airplanes. Also, another option is donkey carts.

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