Exactly right. I have no idea what gross margins are on BE vs. LUT fares, but $15k revenue on the former could probably generate as much profit as $50k spend on the latter.
And if free wifi is accurate then I was wrong when I said this would do nothing for GM+ elites since that would be a nice incremental improvement for sure.
Yes. That'
s an excellent point. Take a example of BE vesrus international coach on a 747. With a pitch of 60cm in business versus 30 in coach and 7 breast versus 10 abreast on 747 or 6 breast versus 8 abreast on a 332, a business class customer is taking up 2.7 to 2,9 times the floor space of an economy class passenger. If you include the cost of providing business class service to this, such as more crew per person, better food, COS bonus, free access to lounge, it's not difficult to see that a larger spend does not necessarily mean proportionately larger profit.