Here’s a classic example of supply and demand, and where the government gets in the way of capitalism.
US & Mexico have limited the number of flights between certain cities. That means that the cost of flights is increased. Who does that help? The corporations!
Tell the governments to just get out of the way!
Most restrictions on flights between the U.S. and Mexico will lift on Sunday, a change expected to bring more options and possibly lower prices for travelers.
American, Delta and Southwest have already announced that they will offer new flights across the border later this year. United is watching the demand for flights and will respond accordingly, a spokesman said.
The United States and Mexico agreed in December to open their aviation markets to each other’s carriers. Rules that had generally limited two or three airlines from each country to a particular route will go away.
Airlines on both sides of the border will be able to fly whatever routes they want as often as they want and set their own prices, said Thomas Engle, the State Department’s deputy assistant secretary for transportation.
“This will help reduce airfares for sure,” said George Hobica, founder of the travel site airfarewatchdog.com.
Hobica said base fares between the U.S. and many destinations in Mexico are already low, but both countries impose taxes that inflate the price of a ticket. “The fares are low, it’s the rest that makes it seem expensive,” he said.
For example, on a round trip between Dallas-Fort Worth and Cancun, Mexico — already a popular route — taxes and fees can account for between 20 and 30 percent of the price of a bargain, economy-class ticket of $383 to $585.
Southwest promoted fares as low as $258 for a round trip, although seats were limited and the offer was scheduled to end Sunday.