Originally Posted by
OZFLYER86
Eg. on the VA flight BNE/CNS the 1st few bidders, might have been successful at $50. Then they told their friends, who weren't successful at $50, but got them for $60, then $70, $80
or even buy 1 for $70, buy 2 for $135, buy 3 for $190, but 4 for $240 etc.
Given the security charge of $5.82 and passenger service charge of $26.87, with GST leviable on both, that's $35.96 of the fare that VA doesn't see.. So for a $50 fare, that leaves $14.04, 1/11th of which will go to GST, leaving VA to pocket $12.76. Minus the cost of extra fuel needed to carry an extra 50-100kg of self loading freight and their luggage. Obviously, out of $70 they would get more, in this case $31. Also you want to avoid training consumers to expect either cheap airfares - or cheap packages. So there must be a point below which it is not worthwhile, unless you have strong ancilliary revenue (like JQ) to support it.