Why did prices rise for new flights?
Prices have soared for customers scrambling to rebook flights after the collapse of Thomas Cook.
So are the price hikes simply due to a sudden rush of demand, with hundreds of holiday makers forced to change their travel plans at the last minute? Or is something else going on? Some horrified travellers want to know if other airlines are exploiting the opportunity to put up prices and rake in profits? In other words, is this what is known in the US as "Price gouging"? How do airlines set ticket prices? Many factors influence the ticket price, including how many seats are available and how many people are looking for tickets, the popularity of certain routes and times of the day, plus other factors such as what has happened to ticket sales over the previous 12 months.
Just because of sophisticated computer algorithms, these days airlines can alter prices minute-by minute.
Humans do still have a hand in pricing, according to industry expert Tim Jeans, chairman of Newquay Cornwall Airport and former managing director of Monarch Airlines.
What is happening to prices now?
Lots of people who have had to find new flights to replace the ones they had with Thomas Cook have found prices are higher, in some cases three times the original cost.
Thomas Cook customers in shock over price rises.
Mr Jeans says there has definitely been a strong supply and demand element over the past few days.
"If you were a holiday company, why wouldn't you want to sell them for more? People are complaining about prices going up, but they are providing alternative flights at short notice." So is it 'gouging'? Price gouging is a term, largely used in the US, to describe when a seller raises the prices of goods or services to an unreasonable or unfair level, often as a result of a sudden increase in demand.
Some Thomas Cook customers have accused airlines of cashing in on the holiday firm's demise, by pushing prices sky-high.
"It would be naive to assume that if you have five people bidding for a flight seat it would be the same price as if just one person wanted it." Will prices fall? " I think things will have calmed down in the next few weeks," says Mr Jeans.
"If people have seen big price fluctuations, and they are able to wait for now before booking future holidays, then I would say sit tight for now." And he says that by the next summer season the fact that Thomas Cook has gone bust will not make much difference.
#Jbest
Prices have soared for customers scrambling to rebook flights after the collapse of Thomas Cook.
So are the price hikes simply due to a sudden rush of demand, with hundreds of holiday makers forced to change their travel plans at the last minute? Or is something else going on? Some horrified travellers want to know if other airlines are exploiting the opportunity to put up prices and rake in profits? In other words, is this what is known in the US as "Price gouging"? How do airlines set ticket prices? Many factors influence the ticket price, including how many seats are available and how many people are looking for tickets, the popularity of certain routes and times of the day, plus other factors such as what has happened to ticket sales over the previous 12 months.
Just because of sophisticated computer algorithms, these days airlines can alter prices minute-by minute.
Humans do still have a hand in pricing, according to industry expert Tim Jeans, chairman of Newquay Cornwall Airport and former managing director of Monarch Airlines.
What is happening to prices now?
Lots of people who have had to find new flights to replace the ones they had with Thomas Cook have found prices are higher, in some cases three times the original cost.
Thomas Cook customers in shock over price rises.
Mr Jeans says there has definitely been a strong supply and demand element over the past few days.
"If you were a holiday company, why wouldn't you want to sell them for more? People are complaining about prices going up, but they are providing alternative flights at short notice." So is it 'gouging'? Price gouging is a term, largely used in the US, to describe when a seller raises the prices of goods or services to an unreasonable or unfair level, often as a result of a sudden increase in demand.
Some Thomas Cook customers have accused airlines of cashing in on the holiday firm's demise, by pushing prices sky-high.
"It would be naive to assume that if you have five people bidding for a flight seat it would be the same price as if just one person wanted it." Will prices fall? " I think things will have calmed down in the next few weeks," says Mr Jeans.
"If people have seen big price fluctuations, and they are able to wait for now before booking future holidays, then I would say sit tight for now." And he says that by the next summer season the fact that Thomas Cook has gone bust will not make much difference.
#Jbest
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