United MileagePlus (Consolidated) - United Raising Fares Again

Whats up with this? They just raised fares 2 weeks ago even though jet fuel has been stable. Now they want another increase. This is what you get when airlines merge and there is less competition. CO did raise fares when they had to, but united is just taking it to another level. Other airlines have yet to match the 2nd increase so it may get rolled back, but just the fact that they are doing this makes me unhappy with this airline.

I know merger costs are hurting the airlines, but when you aquire another business there are going to be costs. Maybe they did not anticpate these costs. They laid off a bunch of works and gave them severence packages, so in the long run they will save money. They are also painting the planes, and updating some of them to E+.

I just don't get it. Eventually we won't be able to afford to fly as it will be a luxury. If people stop purchasing these insane fares maybe they will get the hint, but who knows

I wonder if other airlines will follow?

I wonder if other airlines will follow?

There is some speculation that the discount carriers won't, in which case, united would likely back down. Time will tell...

http://www.sfgate.com/business/article/United-Airlines-raises-round-trip-fares-by-10-3756815.php

At some point the carriers will hit a wall and people will stop buying. I'm surprised it hasn't happened before now but I guess everyone's doing better financially than we are told.

At some point the carriers will hit a wall and people will stop buying. I'm surprised it hasn't happened before now but I guess everyone's doing better financially than we are told.

Or people are still accumulating unnecessary debt on their credit cards or loans.

Or people are still accumulating unnecessary debt on their credit cards or loans.

Actually, I think you are correct. A lot of people are living off of their credit. Not a healthy situation.

...I just don't get it. Eventually we won't be able to afford to fly as it will be a luxury. If people stop purchasing these insane fares maybe they will get the hint, but who knows

It really is insane, but there isn't much we can do about it. United is focusing on business travelers, who presumably have less elastic demand for air travel (especially considering there are no substitutes in many markets) than leisure travelers.

United has basically told leisure travelers to eff off. If you're not flying on a Y/B/M fare or in a premium cabin, they really don't want your business - and they are not shy about it.

UA's clearly-stated strategy is to focus on large corporate accounts. While those fares are discounted, they also include a good deal of paid intl. F/C and other extremely lucrative sources of cash.

If OP doesn't like the fare he's offered, he shouldn't accept it and will need to seek alternatives or not fly. If he's joined by enough people, maybe UA (and others) will relent or go belly up.

UA is betting that the steady corporate revenue will beat the occasional leisure traveler or jumps ship to KettleAir, and UA's bets are likely the result of serious market research. Not that research isn't sometimes wrong. But, here what UA is doing does seem to make sense.

Other than previously booked flights, I've dropped UA going forward. I'm also noticing that their pricing is noticably higher on my corporate travel site for the routes I fly.

Pretty easy decision to fly AA when their flights are cheaper and they are giving me Platinum EXP. I fly First allot more than I've done with UA in a long time, service is superior (CS, Gate & on the plane.)

So if you haven't gotten the message yet, I hope for your sake the price hike is the last clue you are going to need to hear before you switch. UA has proven they can continually make it worse for you, so I have no doubt they will. I'm through with this insanity. It's so much better, easier and cheaper to fly AA.

How do you think they're going to pay for the new pilot contract?

They lost money last quarter and they're going to agree to pay the pilots more. Something has to give, and in this case it's passengers.

They lost money last quarter

ummm.... no they didn't.

Not defending this, but it's certainly not unique. Fare raises have been sparse in the little while before UA raised them a couple of weeks ago, but go back the last couple of years, and you'll see lots of instances of airlines attempting to raise fares within a week or two of the last one. Yes, before the merger. That's life.

Also not clear if it sticks until every other major carrier follows. Even if one major doesn't, his will get roles back.

How do you think they're going to pay for the new pilot contract?

They lost money last quarter and they're going to agree to pay the pilots more. Something has to give, and in this case it's passengers.

Wrong. UA made a significant profit last quarter. Either UA filed false reports with SEC or you misread.

Wrong. UA made a significant profit last quarter. Either UA filed false reports with SEC or you misread.I think what is confusing folks
UA reported Net Inc loss (448M) in Q1
UA reported Net Inc 339M in Q2
so there is a loss for H1 & Q1 but a gain for Q2
reference: http://finance.yahoo.com/q/is?s=UAL, Financials, Income Statement, Quarterly View

I don't have all the details but my bro tells me his daughter's family's trip SFO-Italy, France, currently taking place, was cancelled by her when UA upped $200 per pax allegedly for fuel surcharges, apparently after the original tix were issued.
Piqued, MA reticketed the whole 4 week trek on Delta, presumably without paying any fuel surcharges, though with a connecting flight out of DTW TATL.
Just food for thought...:rolleyes::rolleyes:

Or people are still accumulating unnecessary debt on their credit cards or loans.

Actually, I think you are correct. A lot of people are living off of their credit. Not a healthy situation.

Not to continue with this completely off topic direction, but you are both dead wrong.

Personal debt continues to drop and saving rate is near its high over the past 10 years in the USA.

UA is raising prices because they can.

Capacity discipline is being adhered to, and simple supply and demand dictates that UA should be able to push through price increases.

Prices will be even higher at this time next year...

Not to continue with this completely off topic direction, but you are both dead wrong.

Personal debt continues to drop and saving rate is near its high over the past 10 years in the USA.

UA is raising prices because they can.

Capacity discipline is being adhered to, and simple supply and demand dictates that UA should be able to push through price increases.

Prices will be even higher at this time next year...

Debt/savings rate is relative. US had/has one of the highest debt rates/lowest savings rates in the world. And unemployment rate continues at historic high.

It'll be interesting to see if your predictions about prices next year are similarly correct.

UA's clearly-stated strategy is to focus on large corporate accounts. While those fares are discounted, they also include a good deal of paid intl. F/C and other extremely lucrative sources of cash.

If OP doesn't like the fare he's offered, he shouldn't accept it and will need to seek alternatives or not fly. If he's joined by enough people, maybe UA (and others) will relent or go belly up.

UA is betting that the steady corporate revenue will beat the occasional leisure traveler or jumps ship to KettleAir, and UA's bets are likely the result of serious market research. Not that research isn't sometimes wrong. But, here what UA is doing does seem to make sense.

Clever man, Jeff Smeagol. The more you yank up the fare, the classier the product looks. Amazing nobody thought of that before!

Debt/savings rate is relative. US had/has one of the highest debt rates/lowest savings rates in the world. And unemployment rate continues at historic high.

It'll be interesting to see if your predictions about prices next year are similarly correct.

8.3% is an historic high? How do you figure?

And unfortunately, I do believe that airfares will be higher in summer of 2013... I would love to be wrong on this one.

but just the fact that they are doing this makes me unhappy with this airline.


Really? Just this? Everything else is hunky-dory?

I don't have all the details but my bro tells me his daughter's family's trip SFO-Italy, France, currently taking place, was cancelled by her when UA upped $200 per pax allegedly for fuel surcharges, apparently after the original tix were issued.
Piqued, MA reticketed the whole 4 week trek on Delta, presumably without paying any fuel surcharges, though with a connecting flight out of DTW TATL.
Just food for thought...:rolleyes::rolleyes:

Sorry something doesnt add up, once a tkt is issued the carrier can NOT up the price in any way

I don't have all the details but my bro tells me his daughter's family's trip SFO-Italy, France, currently taking place, was cancelled by her when UA upped $200 per pax allegedly for fuel surcharges, apparently after the original tix were issued.
Piqued, MA reticketed the whole 4 week trek on Delta, presumably without paying any fuel surcharges, though with a connecting flight out of DTW TATL.
Just food for thought...:rolleyes::rolleyes:

Assuming the tix were already issued, it sounds like a clear violation of the DOT regs. They can file a complaint with DOT if they're still PO'd about it.

I may be mistaken in my membory, but this seems like SOP from airlines going back sometime. If they are sucessful with one increase, they try another.

On a whole, the industry has been much more succesful since the DL/NW merger (NW often held out on fare increases), now with the UA/CO merger, there is less competion - except on certain route flown by WN and new LCC carriers. One can only imagine what will happen to the market place with further consolidation. Passengers almost never win in a merger - although I think the US/PI and the TW/OZ mergers may be exception.

They always say it is about creating a seemless network, but really codeshares, through fares, interline ticketing, and interline baggage is seemless enough in my book.

I don't have all the details but my bro tells me his daughter's family's trip SFO-Italy, France, currently taking place, was cancelled by her when UA upped $200 per pax allegedly for fuel surcharges, apparently after the original tix were issued.
Piqued, MA reticketed the whole 4 week trek on Delta, presumably without paying any fuel surcharges, though with a connecting flight out of DTW TATL.
Just food for thought...:rolleyes::rolleyes:

Sorry something doesnt add up, once a tkt is issued the carrier can NOT up the price in any way

Indeed. And how long has MA been out of business anyway? Besides even when there was a Malev, it was a Oneworld carrier; what would they be doing tickeintg on DL?

Or people are still accumulating unnecessary debt on their credit cards or loans.

Bingo!!

:-::-::-:

Assuming the tix were already issued, it sounds like a clear violation of the DOT regs. They can file a complaint with DOT if they're still PO'd about it.And I can't believe United would even try to get away with something like that. Fuel pricing has been volatile for years, and I've certainly purchased tickets at a time when the fuel was low and then zoomed skyward by the time I flew. Never has United (or any other airline) tried to ding me for more $$$.

Getting back OT, it's important to keep in mind who these increases are aimed at. It's not the Kayakers, who have the flexibility to shop for fare sales based upon destination. This is all about getting a few extra bucks from the traditional road warrior, the person flying SFO-ORD or LAX-JFK on a regular basis. For most of us, $10 here, $50 there, is irrelevant, because we're looking to buy when the timing's right, at prices well off an M, B or Y fare.

We also have, as mentioned, some flexibility in where we fly. I just saved a whole lot of $$$, and improved upgrade options, by flying SFO-BRU instead of SFO-CDG in a couple of weeks. Sure, I'll miss the inner guts of CDG, but I'll get over it. :D

Rather than focus on the mythical $10 increase across-the-board, we need to see what's happening to average fares overall.

If OP doesn't like the fare he's offered, he shouldn't accept it and will need to seek alternatives or not fly. If he's joined by enough people, maybe UA (and others) will relent or go belly up.

I'm a 1K (been so for 10 years) now but who knows going forward. Right now I'm only at about 35,000 miles for the year so it's not looking too favorable. I haven't posted in a while because I have taken the alternatives which have included other carriers and that old standby, driving. When I'm looking at a $750 one way fare or driving 12 hours, I unfortunately drive.

My wife is a silver as are my two sons, but going forward my wife is so pissed off at UA that she is shifting the family's travel elsewhere. She particularly disliked a comment made by a UA executive about UA elites having been "over entitled" and as a result now not being able to pick an E+ seat at time of booking.

She is an exec at a major national retailer and her biggest efforts there have been working with the sales force to enforce the culture that the customer is key and most important. This is what drives sales and loyalty. In her opinion she says that the new United just doesn't get it and predicts that eventually all the "over entitled" elite customers will just disappear from their flights.

PS...and by the way, who in their right mind thought the Spring break travel time was a good time to initiate the merger...and how could the senior management staff have agreed to it? My personal thinking is that it was a bunch of MBA's (not entrepreneurs) looking at spreadsheets.

My new motto when anything goes wrong these days is, "I've been Jeff'ed."

Indeed. And how long has MA been out of business anyway? Besides even when there was a Malev, it was a Oneworld carrier; what would they be doing tickeintg on DL?

Not to go too OT, but as long as there is an agreement, a carrier can issue a ticket with segments on whatever carrier they want. In Feb., I was ticketed on TK via ORD, and despite them being in *A and UA offering non-stop service on my connector, they flew me AA.

Not to go too OT, but as long as there is an agreement, a carrier can issue a ticket with segments on whatever carrier they want. In Feb., I was ticketed on TK via ORD, and despite them being in *A and UA offering non-stop service on my connector, they flew me AA.

Well, yes, of course. And I have purchased from UA directly on 016 stock a ticket for travel entirely on AS. But such is rare. OP was discussing a UA ticket, which was apparently was rebooked by MA for travel on DL -- all because of price, not irrops or anything. I'm just highly confused as to what transpired.

Just looking at an NYC-CHI run for 8/9-8/11 and united is starting at $437. I've flown this route many many times and never seen it this high without being 1-2 days before. ITA shows options for AA at 280, DL, WN, B6, and NK (not an option though) at around 330.

Now I'm willing to pay a little extra to keep the miles under one roof with hopes that its sunny after it pours, but I'm sorry, the privilege of flying UA E is not $150 more than anyone else. Plus marine air terminal at LGA > terminal C zoo.

Not sure what type of customer this price is really targeted at..

Just looking at an NYC-CHI run for 8/9-8/11 and united is starting at $437. I've flown this route many many times and never seen it this high without being 1-2 days before. ITA shows options for AA at 280, DL, WN, B6, and NK (not an option though) at around 330.

Now I'm willing to pay a little extra to keep the miles under one roof with hopes that its sunny after it pours, but I'm sorry, the privilege of flying UA E is not $150 more than anyone else. Plus marine air terminal at LGA > terminal C zoo.

Not sure what type of customer this price is really targeted at..

definitely amazed by how much price premium UA could command on such a competitive route ... and that 437 is out of LGA not EWR :confused::confused:

Just looking at an NYC-CHI run for 8/9-8/11 and united is starting at $437. I've flown this route many many times and never seen it this high without being 1-2 days before. ITA shows options for AA at 280, DL, WN, B6, and NK (not an option though) at around 330.

Now I'm willing to pay a little extra to keep the miles under one roof with hopes that its sunny after it pours, but I'm sorry, the privilege of flying UA E is not $150 more than anyone else. Plus marine air terminal at LGA > terminal C zoo.

Not sure what type of customer this price is really targeted at..

Well, you can either prove them right and buy it (a lot of predictive analytics went in to this price you know).

Or you can prove them wrong ($437!?) and buy a flight on AA.

$280 sounds a lot better to me...

Just looking at an NYC-CHI run for 8/9-8/11 and united is starting at $437.
...
Not sure what type of customer this price is really targeted at..definitely amazed by how much price premium UA could command on such a competitive route ... and that 437 is out of LGA not EWR :confused::confused:Flights on 8/9 LGA-ORD are nearly sold out looking at seat map and only Q fares are avialable

Flights on 8/9 LGA-ORD are nearly sold out looking at seat map and only Q fares are avialable

Which means UA got it right.

And AA is leaving money on the table...

Which means UA got it right.

And AA is leaving money on the table...

It helps that they've cut capacity on the route by switching 4 mainline flights a day to RJs...that's ~200 seats right there.

Little Lord Jeffleroy is obligated to charge as much as the market will bear or be fired.

RNE, "para-channeling" my hero Milton Friedman.

I wish I was still naive to think that if airlines rose their fares enough, we could get back to improving service rather than cutting it- but alas, I am not.

It helps that they've cut capacity on the route by switching 4 mainline flights a day to RJs...that's ~200 seats right there.

You hit the nail on the head...

This is the real reason UA is able to raise prices.

Clearly the surprise of the century. Wasn't that what the shareholders wanted?

Oh, you're not a shareholder. Right.

Pretty easy decision to fly AA when their flights are cheaper and they are giving me Platinum EXP. I fly First allot more than I've done with UA in a long time, service is superior (CS, Gate & on the plane.)

[snip]

It's so much better, easier and cheaper to fly AA.

Just looking at an NYC-CHI run for 8/9-8/11 and united is starting at $437. I've flown this route many many times and never seen it this high without being 1-2 days before. ITA shows options for AA at 280, DL, WN, B6, and NK (not an option though) at around 330.

Now I'm willing to pay a little extra to keep the miles under one roof with hopes that its sunny after it pours, but I'm sorry, the privilege of flying UA E is not $150 more than anyone else. Plus marine air terminal at LGA > terminal C zoo.

Not sure what type of customer this price is really targeted at..

AA is offering discount F on this route for the same price (or just a little more) UA is asking for economy. I believe DL is also reasonable, and reports are positive for their inflight experience on this route. If you are able to break away from UA, there are options.

You could also fly AA JFK-MIA-ORD on a 762 and 763. All wide-body service! Was coming in a dy early for a meeting so I had some slack in the schedule :D

My personal thinking is that it was a bunch of MBA's (not entrepreneurs) looking at spreadsheets.


... and lawyers ... and programmers ... and marketers ... seems anyone will do, as long as they don't know anything about the airline business.

You hit the nail on the head...

This is the real reason UA is able to raise prices.

And, the RJ's are probably flown by outsourced labor, so the cost per seat should be even lower.

Classic economics curve - optimizing for point of greatest marginal utility.

However, if they were getting it right in aggregate, then their financial results should be improving.

Are they actually raising fares or are they selling out the lower fare classes? I find that most people don't do the fare and availability research to figure out which situation they are in.

Also, which markets? Or is this across the board?

Are they actually raising fares or are they selling out the lower fare classes? I find that most people don't do the fare and availability research to figure out which situation they are in.

Also, which markets? Or is this across the board?appears to be raising fares in most markets -- suspect a few specific competitive markets may have been exempted.

Of course fares are going up. There are fewer competitors. Mergers never are a plus for passengers, nor labor - and often not in the long run for stockholders; every airline which has been involved in a merger (save WN) has later gone to bankruptcy court. The only ones who win are: management, investment bankers, and lawyers. But certainly not passengers.

The fare increase failed. Cf India:

http://www.nytimes.com/2012/08/07/business/carriers-back-off-on-raising-air-fares.html
http://www.dnaindia.com/money/report_airlines-regain-pricing-power-on-supply-squeeze_1724798