Isn't it a bit presumptuous to think that someone who is not in the industry understands airline pricing models that maximize overall margin better than the airlines? They have the equivalent of supercomputers figuring this stuff out. All the booking codes, class of service, day of week, time of day, length of layover, distance of flight (2+ leg through a hub that is further away), time between booking and flight - all variables that are constantly analyzed to extract the highest overall margin.

I was a top tier frequent flyer on United for over 5 years. I'm not talking the 1K top tier they publish the entrance requirements for - I was Global Services which is invitation only, unpublished. They do bend over backwards for their top revenue generators - the perks are things you think only exist in movies. It's mostly revenue based, and back then $50K in paid tickets seemed to be the criteria. I'm still 1K - 4 business class trips to Asia in 2019 was enough to quality, and status has been extended due to COVID. This year I've had only one domestic trip, and another coming up. Might make Gold, with the extra kickers they are giving us to re-qualify on status.

It's a demand based model, not a cost plus model. Direct flights, or shortest total flight time through a hub, with reasonable length layovers, during normal hours are the most desirable, and cost more. Long layovers, long distances to a hub, long layovers, early mornings, late nights, are less desirable and cost less. Leisure travelers book long in advance and usually get restricted or non-refundable tickets because they are cheaper. Business travel is often on shorter notice, and are willing to pay more for less restrictions due to the fact that changes may happen. When I book an international trip, I start with the days/times I want to travel, understand the booking code, then have the agent (corporate travel agent is required for international bookings) see if there is a cheaper booking code available on a different day, or a different route. In many cases, several hubs have international flights to the same destination (ORD, IAD, EWR, SFO, all have flights to most of the major cities in east Asia). One time I got the price down but more than $1K by taking a longer layover on the return flights, knowing that once I landed and got through Global Entry, I could change to the earlier flight or fly standby at no charge. Flying home on Friday is usually the most expensive - Saturday is often cheaper, Sunday is cheaper still.

I've gotten sick a couple times while in Asia. And it is certainly true that common colds and flu caught overseas can hit you a lot worse than stuff you get locally. I can think of 3 times I flew back home sick. One time I even shortened the trip by one day to get home earlier. Sorry but NO ONE is going to tell me I can't fly home and have to go to a local doctor in China or India for treatment. I have never needed medical care outside the U.S. and I'm not about to subject myself to it unless it is absolutely necessary. Quality of care is the first concern, but how to pay for it, coverage under my insurance (lack of it), and a lot of other things come into play. I would probably just charge it to my company credit card and then ask accounting what to do when I get home. That is realistically the only practical option. When I was in college I flew sick once too between home and school.

After returning from one trip to China, Korea, and Japan in 2015 it took me two visits to the Dr. and two rounds of antibiotics to get better. While I was in China, a friend I had dinner with a couple times had a cough, and sure enough within a few days I had it too and it really got bad while I was in Japan. How long should I have to stay in a Tokyo hotel at $300+ a night before I am allowed to go home?

As far as a "no cost" flight change goes, yes it would be abused. When I was managing production at a union plant there was a doctor in town that would sign any excuse for anyone saying "unable to work" for the missed days, in the language required by the union contract. The "emotional support animal" fiasco where completely untrained animals have been allowed on flights with their self-important owners is proof.

quote:

Originally posted by Lefty Sig:


As far as a "no cost" flight change goes, yes it would be abused. When I was managing production at a union plant there was a doctor in town that would sign any excuse for anyone saying "unable to work" for the missed days, in the language required by the union contract. The "emotional support animal" fiasco where completely untrained animals have been allowed on flights with their self-important owners is proof.

Hawaiian Airlines has been doing no cost flight changes for around 14 months at this point and has said they will continue this policy for the forseeable future.

While I agree that virtual meetings have been proven to be effective during the last 1.5 years - and executive travel should be significantly reduced. This means the suits who fly overseas on Monday, arrive Tuesday, have meetings Wednesday and Thursday, and fly home Friday. All of that can be done virtually.

The stuff I do - sitting in a conference room for a week planning a new production line with a local team, then spending another week reviewing concept designs at the equipment suppliers, and then many weeks over several trips reviewing and approving the designs, attending the runoff, and finally doing onsite reviews of the install and validation status - cannot be done virtually. Stuff is already going sideways on several large projects because I cannot travel, nor can others. The schedules can't change and the local teams are handling things, but unfortunately, they are more beholden to the whims of their local management to do things that are trendy or buzzwordy but not the most viable for the long term needs of the operations.
My trips are 2-3 weeks long, to get the most value from the cost of the business class ticket. It's cheaper to stay more days in a hotel, then make more trips.

quote:

Originally posted by Flash-LB:

quote:

Originally posted by Lefty Sig:


As far as a "no cost" flight change goes, yes it would be abused. When I was managing production at a union plant there was a doctor in town that would sign any excuse for anyone saying "unable to work" for the missed days, in the language required by the union contract. The "emotional support animal" fiasco where completely untrained animals have been allowed on flights with their self-important owners is proof.

Hawaiian Airlines has been doing no cost flight changes for around 14 months at this point and has said they will continue this policy for the forseeable future.

This is more likely by necessity. Hawaiian Airlines is mostly discretionary leisure travel. And it's not easy getting people to buy tickets during COVID when the chance that an outbreak might have caused travel restrictions - or an individual getting it would lead to cancelling the trip. Hawaii had stupid restrictions for a lot of the time too.

quote:

Originally posted by Lefty Sig:
Isn't it a bit presumptuous to think that someone who is not in the industry understands airline pricing models that maximize overall margin better than the airlines? They have the equivalent of supercomputers figuring this stuff out. All the booking codes, class of service, day of week, time of day, length of layover, distance of flight (2+ leg through a hub that is further away), time between booking and flight - all variables that are constantly analyzed to extract the highest overall margin.

Yet another example of someone coming into this thread and making a red herring argument. You've changed the argument that the "entire model is a bite the hand that feeds you" to presumptuous to think a customer understands their demand based pricing models better than a supercomputer. The current demand based model of extracting every last cent from each customer is a very adversarial approach to their customers and feels like they're biting the hand that feeds them. For the past 15 months, the hand that used to feed them isn't feeding them as they're doing virtual meetings instead of taking business trips.

Also, much like the checked baggage fee that nearly every airline implemented after the first airline did it, enticing business travelers back with a cost plus model would just take one major airline to upend the entire fare structure and cause nearly all of the airlines' supercomputers to be reprogrammed to compete for business travel dollars. I know which fare structure I'd fly on if I had to fly overseas to get a project out of the ditch and didn't know if I was coming back in 8-days or 18-days.

quote:

Originally posted by Lefty Sig:
As far as a "no cost" flight change goes, yes it would be abused. When I was managing production at a union plant there was a doctor in town that would sign any excuse for anyone saying "unable to work" for the missed days, in the language required by the union contract. The "emotional support animal" fiasco where completely untrained animals have been allowed on flights with their self-important owners is proof.

In a cost plus model, the airline wouldn't care why the customer changes their flight (sick, trip shortened/extended, etc) they would just charge a small fee. In other words, no abuse because they wouldn't care and customer's wouldn't be tempted to pull one over on them. It's no longer an adversarial business model.

Having routinely dealt with people having a medical emergency at the airport most of them flying via southwest I have a couple of observations.

Airlines can and do tell people they cannot fly for medical reasons. I have seen it multiple times and transported people after the Dr that the airline has on call spoke with the passenger.

When they do do the good ones (southwest) tell the person needing treatment to call them when they get out of the hospital to reschedule the flight for free. In fact I’ve seen them arrange a place to stay for family members while their loved one was in the hospital.

I spoke with a customer rep about it one time and she stated that it was their policy to make it right by the passenger when a medical issue is involved.

So that being said I am sure this gets abused some but I have seen it work out well for the passenger multiple times.

This makes good business sense.

Aviation doesn't make good business sense.

The old saying goes that if one wants to make a small fortune in aviation, start with a large one.

tatortodd,

You are arguing against the law of supply and demand and the concept of capturing the consumer surplus, which is something the airlines are very good at.

Leisure passengers are cost sensitive and are willing to plan long in advance and accept lots of fare restrictions to save money on non-essential travel. When your planning horizon is a few months from now, you have lots of flights/seats to choose from. Lower demand, higher supply, lower price. And guaranteed business in the future worth less today due to simple present value calculations.

Business customers are time sensitive and often book on short notice, require flexibility to make changes, and historically have been willing to pay more for it. With a shorter planning horizon and less flexibility on dates when they have to be somewhere, there is a smaller supply of available flight/seat options. Higher demand, lower supply, higher price.

That's not to say they couldn't change some things - Southwest has done that in a lot of ways that some customers like. I used to have corporate fixed pricing on flights to Asia with no restrictions and full refundability. Pay the flat price, fly any flight that has an open seat, change or cancel whenever you want with no penalty. It was great - finish a day or two early, or need to stay a few days extra, just call the agent and change it.

Then some asshole in corporate travel decided we could save money by getting variable pricing by fare class on non-refundable tickets. So now those of us who are experts play the game of trying to find the best cost by route/day/time/connections, while newbies can get screwed. Agents are required to do a low fare search within a certain time period of your intended travel times, but it's not a huge window. Non-refundable can certainly be cheaper, but changes cost around $500 and cancellations go to the "travel bank". When travel budgets get cut, trips are cancelled, but with the tickets already paid for there is a sunk cost to your department's travel budget, and COVID left a huge "bank" of unused tickets. Even when we had it good, someone "thought" they could save money. And maybe they did, I haven't seen a long term financial analysis of it.

But it's like saying how car dealers would be better off with a flat pricing model (such as fixed % markup) and no haggling. Customers get a fair price, dealers make a fair profit, and without all the pain, customers would buy cars more often, generating more sales volume.

Except despite the "wisdom" in this approach, it never actually sticks. Again because the profit dealers can extract from malleable customers is much higher than they would get from fixed pricing. And most customers that believe they are "good negotiators" (many more than actually are) think they could get a better price.

Concerts used to be fixed price and good seats went to those that were first in line. Now pricing is tiered so that good seats cost hundreds and nosebleed or lawn seats are a lot lower. Again, capturing the consumer surplus. Selling the low supply commodity (good seats) for more money until supply and demand balance.

Similar, cost plus pricing on airlines will result in higher prices for the discretionary traveler and lower prices for the business traveler. All it takes is one airline to undercut the fixed price and discretionary travelers will go to the cheapest airline.

Now, given the fact that COVID has forced everyone to do virtual meetings and the technology has caught up with regard to internet speeds and real time video capability, I agree that airlines are now competing against the much lower cost option of virtual meetings. In person meetings are essential to build relationships in some cultures, but could occur much less frequently with virtual taking up the rest. This may mean major changes to the airlines - fewer flights, changes in plane capacity, different allocations between cabins, and pricing changes. They will do what they have to based on the market demand to align their business model to the new reality.

I'm all for more flexibility for changes and lower overall prices, and not having every single passenger in a plane paying a different price. Then again, my company does not use cost plus pricing for our products - B to B pricing depends on sales volume, ordering window, number of product variations, and overall product portfolio.