Calling All Business Majors

Okay, here's something that doesn't make sense to my liberal-arts-educated brain. I'm hoping the business majors out there can sort it out for me/us.

Ethiopian Airlines, the government-run state airline of my adopted country has a good record of providing safe, on-time international service, where they have lots of competition (Emirates, Kenya Airways, Turkish Air, etc). Now, about the domestic flights:

They pretty much go wherever they like, whenever they like, and published schedules be damned. In one record-setting run, L and I spent nine late-flight waiting hours over the course of three domestic flights. This is time beyond the scheduled departure. In another instance, the flight from Addis to Bahir Dar first went to Gondor because... well, just because. On my first flight from Axum to Addis, we started back down after only about 25 minutes in the air (Axum-Addis takes more than an hour.) We landed it Lalibela because once he was in the air the pilot figured out he didn't have enough gas to get to Addis. In Lalibela, the guy who had the keys to the gas truck was somewhere in town eating lunch, so we waited 2-1/2 hours for someone to find him so we could gas up the plane and return to Addis. Once a flight left Bahir Dar one full hour early, because the plane was there and ready to go.

The Airline's standard response to complaints about their indifference and buffoonery is that they don't make any money on domestic flights. They say they can't raise rates to cover their costs and make a profit because nobody on domestic flights would be able to afford it. But the flights are always fully booked a week or two in advance. Does this make sense from a business standpoint?

Or could it be that, as with the telecommunications industry, a lack of competition lets them do whatever they please with no risk of loss of business?

Discuss.

Comments

[Stew]

If it's a monopoly, they can do what they damn well please. When there's no alternative (competition), then there's little incentive to provide good service. What're people going to do, walk?

If it's not a monopoly? Use the other carrier. Unless they're...WORSE?

[Biz major]

If there is a constant demand and they are the only supplier, the market does not force them to practice good will in their operations. They will do what they want when they want, as your next option is Autobis terra and Cacammali ,which they know you wouldn't do. You are paying for a service that is a notch better than traveling by bus, but not quite on the cloud nine standards either.

[Kati]

I heard the stories too. It seemed quite silly to me to probably be booked on the only flight in and out that day and have to be at the airport 3 hours ahead of time to check in and go through security. I mean, the airports seemed deserted!! And we seemed to be the only fools at the airport, waiting, until the flight boarded and it was always, always, full! Where the smarter locals were hiding until boarding time, I'd love to know. It did not happen to our group, but an email from our group leader confirmed that all those troubles you mentioned with the inflight service of EA happened to him in spades with the next tour group he took through Ethiopia!

[Marc]

Well, yes, one learns to show up maybe an hour early. After all, a miracle could happen: the flight could leave on time.