Wow, NSX
You have an interesting argument, and load factor/yield are two of many traditional means of measuring an airline's health. While using standby pax to fill up flights gets rid of the overbooking problem, which is one of the issues with high load factors--high 70s and above. There's one thing you may not have considered when it comes to "topping off" flights with incremental income. The load factor is a systemwide average. Flights between A and B may operate at an 85% LF, while flights between C and D have a 45% LF. Bill Owen has written about our optimized schedules to cull out poor performing flights, but the demand, even for low cost standby travel has to be there. It's like the Antiques Roadshow. An appraiser may say an item is worth $1,500, but you have to have two people at an auction who want to buy that item. Obviously, there would be costs in carrying standby passengers. Ticketing and processing them would take money, additional fuel or possible offloaded cargo to accommodate them is another cost, it takes time during the boarding process to handle standbys. So you would have to set a standby fare at a level to recoup these costs and to make a profit. The danger is that this fare, even for standby, might be higher that the travelers in the market would pay for low demand service. Summing up, you can't always lower fares enough to stimulate demand and still generate a return. But, there are some cases where you could. I just don't know if opening all of these cans of worms is the right step. I will certainly share this thread with our Leaders, though