FlyerTalk Forums - View Single Post - My trip to London: More evidence why the majors are failing
Old Oct 4, 2004 | 6:46 am
  #9  
venk
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Originally Posted by JS
I'll fly out on Sunday and fly back Saturday morning for business to squeeze in more time at work Monday morning and Friday afternoon, but there is no way am I going to sit around all day Saturday and then go back home on Sunday. I say business fares are part of the cost of doing business (a large one with a wide geographic reach) -- deal with it.
If the spread between fares with and w/o sat night becomes too large, then the fare structure becomes extortive rather than provide any value and this the companies are rebeling against because it goes into their cost structure. There are various other reactions to it than staying over. For example, decrease the amount of travel (by making the travel budgets a fixed pie), have back-back ticketing with another airline if you have more than one trip, combine two trips into one, etc.

While there will always be companies that will pay a non Sat night stay fare under certain circumstances, it is fast becoming an unsustainable model at least looking at it from the corporate side. For most mature companies, the amount of travel is not on an increase, but there are pressures for it to come down as cost cutting is a perennial issue.

The longer AA hangs on to this model, the worse it gets and greater the chances of a competitor stealing this business as is happening in domestic routes.

AA's fare structure makes it a corporate problem (the employee's time vs., the company's bottom line). AA (and other majors) would be much better off providing a solution that caters to this problem than creating it for a sustainable business model.
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