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Old May 14, 2015, 3:30 pm
  #687  
percysmith
Ambassador, Hong Kong and Macau
 
Join Date: May 2009
Location: HKG
Programs: Non-top tier Asia Miles member
Posts: 19,807
Originally Posted by Guava
Then they may as well dissolve Oneworld if it's simply every airline for itself. I cannot agree with such thinking, because you may think that's being smart, it will have the opposite effect. The main advantage of OW is its consistency, unlike the gazillion number of exceptions that *A and Skyteam have. Without that, OW would be just as bad as the other two. Customers will cease be loyal, then flight decision becomes a case by case decision as opposed to loyalty driven. Many companies have gone bankrupt because they were laser sharp focus on the short-term gains and because Executive compensations tend to reward these immediate results but that's neither in the best interests of shareholders or customers in the long run.

Cathay's profitability is not tied just to HKG based flyers, there are a lot of non-HKG based customers who are not part of MPC but give their business to CX/KA because they identify with OW. You alienate them, they will dump CX very quickly, which will translate into loss of future business and higher customer acquisition cost. Also, MPC members alone cannot fill all those empty seats that would otherwise go unused. The fact CX can release so many F seats for award suggest they are not expecting to sell a lot of those seats and it's impossible that MPC can fill all of the above even if you forbid partners from claiming it because AM redemption rate is ridiculously high that even MPC members hesitate of using these awards. So the net results is more seats will go empty or give away for free as Op-Ups which are really just wasted. If a customer can reasonably expect to get Op-up very often as someone tried to claim here, what incentive is there to purchase premium cabin? Op-up should not be a frequent event or that customer can expect it happen most of the time. It speaks volume about overbooking and inventory management and that on itself is another problem entirely.
I don't think CX joined oneworld to earn AA redemption revenue, but rather attract paying customers.

It probably thinks both are mutually exclusive - an AA passenger can either use (AA) miles to redeem a seat, or pay for it.

CX is trying to reduce the former (if AA doesn't stop them themselves as mentioned in the milevalue post).
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