FlyerTalk Forums - View Single Post - Bailout? Make 'em abolish Sat. night stay!
Old Jan 28, 2002 | 11:16 pm
  #13  
Doppy
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Airlines have a Saturday night stay requirement for a good reason. Business travelers wouldn't want to have to stay at the client site until Sunday, when their work week ends on Friday. Thus, business travelers won't stay over a Saturday night.

Since business travelers typically have deeper pockets, the airlines charge higher fares on tickets without Saturday night stayovers. If you take out the Saturday night stay requirment, business travelers will start getting access to and booking those leisure $300 or less fares to anywhere.

Let's take a look at an example of what that would do to a JFK-LAX flight operated on an AA 737-800 (the plane doesn't make a difference here, we'll talk mostly in percentages); coach only, let's forget about first class. This plane has 108 seats in coach.

An advance purchase ticket leaving on a Tuesday and returning Wednesday, with a Saturday night stay is $310 including tax; $155 one way.

The same as above, but returning Wednesday without a Saturday night stay, $2258 for the same flights, $1129 one way. (Coincidentally, you can get the fare without a Sat stay for only $461 if you don't fly non-stop lax-jfk).

So in this case, there's a $974 difference each way. Let's say that 20% of the flight from JFK-LAX is made up of business travelers, flying on the $1129 fare, and the other 80% if flying on the $155 fare. Works out great for the leisure travelers, right? Only $155 to get from New York to LA, non-stop.

Now, let's take the Saturday night stay requirement out of the fare rules. Now, to keep revenue the same, what would the new fare come out to be?

With Sat. stay requirement:
108 seats * 20% biz pax * $1129 fare = $24386
108 seats * 80% lsr pax * $155 fare = $13392
Total revenue for the flight: $37778

Without Sat. stay requirement:
Target revenue: $37778
Number of Pax: 108
Fare per pax: $37778 / 108 = $350.

Great for the business traveler, their round trip airfare went from $2258 down to $700.

Not so great for the leisure traveler, his airfare increased by $390 from $310 to $700. That's a 126% increase. I can typically make $700 get me about three leisure trips; taking away the Saturday night stay rule brings me down to one trip. No thanks, I don't want to cut my travel down by 2/3rds so that businesses can save money.

In this example, travelers also had the option of paying $461 and connecting through one city without a Saturday night stay. But, such an alternate arangement isn't necessarily available in every market.

Why do the airlines have a Saturday night stay requirement? Economics; and unless you want to pay significantly more for your leisure travel, you should like that answer too.

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