Originally Posted by
Winkdaddy
Someone mentioned in another post that United Airlines stated publicly early this year how their revenue was hurt due to all the partner redemptions. That just got me thinking if its really that expensive for Delta when customers redeem on partner flights.
I would think it's the stated $0.0054 per mile. DL pays to airline X for 100,000 mile flights 100,000 * $0.0054 = $540. And it likewise gets paid by other ST airlines pax (in the few and far inbetween cases anything is available) redeeming on DL.
BUT, that is way oversimplified, as what about the common itinearies where usually different segments are on different airlines?
In short then, there's probably a rather complex algorithm, and trying to understand that would be akin to trying to understand how the credit derivatives and all that stuff works. I'd bet that even Richard Anderson doesn't fully know or understand how it works, probably even in Rev Mgt just a few know the full formula and how it really works in all the various permutations of it.