Originally Posted by N1Rotate

CX/BA/QF have different types of travellers than QR. First of all they have a much higher percentage of higher yielding O&D travellers.

The branding of the regional F is more to do with the local Qatari market, DOH-DXB-DOH fares in F are around $1350 or around US$ 1.80 per kilometre while you can book on QR.com a MUC-DOH-MEL-DOH-MUC fare in J (was able to price that for Mar 2016) for $2050 or $0.06 per km (That is less than European LCC average fares in economy on a per kilometre basis - not a fair comparison but just contextualises how cheap some of QR's premium fares are) or F class BKK-DOH-LHR-DOH-BKK for $2200 (US$0.10 per kilometre).

Not only are these passengers contributing much more revenue proportionally, they also cost less as the distribution costs are lower (e.g. no commissions in Qatar, while other markets rely on high TA commissions and consolidators) and the taxes on the airfares are lower. They also cost less because they use higher density seating, e.g. an A320 regional F seat takes the space of 2 Y seats while an A380 F seat takes the space of 6 Y seats.

To put things in perspective, 12 O&D pax in first will turn a profit on an A320 (roughly $10000 to 12000 all-in operating cost for an A320 DOH-DXB-DOH) without selling any other seat in Economy or any cargo, while if you fill a 777 with only connecting pax from the US with the typical fares the flight will be loss making even at 100% load factors.

What you label as the "Fake F" fliers are the actually the highest spending core frequent fliers for QR, as that is where the higher number of O&D premium passengers are. While the number of these fliers are small, they contribute a much higher share of revenue proportionally. These are the same passengers that book US$8000 fares to LHR/CDG on the same seats that would be sold for about $1100 (if you divide the $2200 for LHR-DOH-BKK equally). So it makes sense for QR to value them.

Not only is this market less price sensitive, the lounge is a much more important part of the product experience as in many cases more time would be spent in the lounge than in the flight itself. Also this adds more differentiation between regional Y and F to incentivise people to pay the difference between regional Y and F. A typical regional F fare for DOH-DXB-DOH is 8-9 times a typical economy fare on the same route, while your long haul J connecting pax will only pay around 3-4 times the economy price and get a much bigger product differentiation over all. On the other hand most of QR's long haul J class market is price sensitive and the lounge is much less of a factor in the decision making, and Al-Mourjan may not be the best but it certainly is very competitive when looking at other J lounges in the market place.