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Old Jan 6, 2019, 1:25 pm
  #78  
Raffles
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Join Date: Feb 2004
Location: London
Programs: BA, VS, HH, IHG, MB, MR
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Originally Posted by Andriyko
But I am not talking about any commercial benefit for airlines in structuring their prices the way they do. And I am not sure why the question 'then why do airlines do it?' is directed to me. I am not the airlines and I do not come up with the way the final price is arrived at. I was making a point strictly from the point of view of a passenger - I don't care what is what in the final price. I assume other passengers do not either. I gave an example of the same US$700 tickets offered by LH and PS. That the former's ticket was 30% the fare and 70% the carrier imposed surcharge, while the latter's was the other way around should not really matter; which is why I asked why some people are so angry about these surcharges and call them dishonest and a ripoff. Reward tickets aside (and it has been for many years now that the frequent flyer currency only replaces the fare part), I don't see how it affects cash bookings at all. Again, I find Lufthansa's price structure a bit ridiculous (really low fares and humongous surcharges), but if their tickets are often the cheapest I don't see what the big deal is. Even with the example of the lost corporate account, as far as I understood, the issue was not that the price was part fare and part surcharge, but that no rebate was given for the surcharge to bring the overall price down to be competitive. People are getting personal with me simply for asking why it matters what the cash price is composed of.
Sorry to jump back a few weeks on this, but you miss a trick.

Rebates are a big profit source for professional services business. Company books a £5k flight which you, the client, repays. Except the company gets a fat year end rebate on the base fare which it pockets.

Whether the fare component is 70/30 or 30/70 base and charges makes a big difference here.
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