Originally Posted by
seawolf
That's happens often to preserve seats for traffic connecting thru DFW. When AA was running non-stops between LGA-ATL, they were often priced lower than DL non-stops.
Essentially AA is saving the LGA-DFW F seat for LGA-DFW->long haul on a F/J fare over someone who just want to fly F LGA-DFW unless they were willing to pay $626 for it.
Which all sounds great until you consider that AA might be better off to take the $389 local F pax as opposed to the even lower yielding connecting passenger.
Without getting too into the weeds, heavy business travel markets with strong local demand are generally more profitable on a fully allocated earnings basis than they are on the basis of fully allocated earnings plus net contribution of upline/downline flow.
Said another way: connect traffic brings down the profitability of markets like DFW-LGA when you consider the market on a standalone basis.
(Of course the worst possible outcome for AA is that the local DFW-NYC F pax goes and buys the $389 ticket on DL, the flow XXX-NYC F pax never buys a ticket at all, and that F seat gets filled with an upgrading EXP who paid a paltry $200
)