Originally Posted by
emma dog
That one's easy... through years of experience AA has learned that on X route, the only people who want to fly at the last minute HAVE to fly at the last minute and they are willing to pay more. Dropping the price doesn't increase passengers and revenue in excess to what they lose when they no longer capture the revenue from price insensitive travelers.
No, but it means their revenue management may have mucked up earlier in the process by not offering enough discount fares to drive the leisure passengers. Of course, it's also possible that they sold 20 full Y fares in the last few days and the flight is still plenty profitable; there's no way to know.
I also believe the fares are heading down. Earlier this summer, fares to LAS from the East Coast were ~$500+, now they're ~$350. I got a last-minute weekend special in June to FLL for $240, now advance purchase is ~$200.
I think the fares had just gotten out of hand with the cuts in supply, the beginnings of an economic recovery, and a lot of pent-up demand for travel, both business and leisure. Now with the economy slowing people are probably saying they've had enough and are just not booking. And the airlines are getting worried, if not downright panicking yet.