barts

I have been looking at refundable/changeable fares from LHR to BOS or LGA in August (not that the month matters since they are changeable but for the record I also priced out the same itinerary for dates in October and I still get the same price). I am used to paying about $2,000USD for such a flight on a refundable/changeable ticket. This weekend both cities are pricing at almost $2700. Has AC raised their refundable fares that much lately? I did a quick check vs competition and refundable fares on these routes seem to be running at about $1800USD on UA or AA. I can see myself paying $100 extra for flying the carrier of my choice and being able to upgrade at the time of booking but almost $1000 is too much.

My question is the following then: is this price for a refundable ticket on AC the new permanent price or a temporary spike? If it is temporary I will most likely wait, otherwise I will go with another carrier.

Shareholder

What you're really saying is that you don't want to pay what AC is now charging for a M or Y fare, and which guarantees an Elite, SE or Prestige an at-ticketing confirmed upgrade to ExecutiveClass with a SWU cert. So a half-priced seat up front is not worth it in your mind...possibly on a brand-spanking new 777 or refurb'd 763?

That's why AC's fare is higher than UA's or AA's to sit in the back -- if you don't happen to be among their 1K or ExecPlat elites who get SWUs to move up front.

barts

What I am saying is that for the price of Y or M fare on AC I can have a business class seat on another airline. I think when I priced out UA, their price for a business class fare was aobut $2,900. So my choice is the following:

1. pay $2700 for a Y ticket on AC and upgrade with certificates, hope for a refurbed aircraft (I need to fly via YUL which is 767s all summer long)

2. pay $200 extra and fly UA on a business class fare, no certificates, no downgrades (yes even SE get downgraded, travelling with my partner in January, both SE, both downgraded).

3. switch to AA and pay $2500 for a seat up front, not stop flight, more miles. Hmmm now I wonder if I should look at swtiching to AA if these Y and M fares stay high. I can get cheaper paid J class seat on AA then a Y/M fare on AC? This changes the economics of my frequent flying.

My dates of travel are Aug 3 outbound and Aug 9 return - these are the dates I priced AA and UA for. Very unlikely that I will change these so the flexibility with dates on Y/M fares is not that important to me.

zorn

Round trips out of LHR to and from Canada on refundable tickets are known to be expensive.

Some aspect supply and demand is driving these prices. I don't pretend to know what it is, except to point out that AC surely sees BA as its main competitor out of LHR. The refundable fare for LHR-YUL-LHR on BA is 2340 CAD base fare. Lo and behold, that is AC's fare as well. Looking at YUL-LHR-YUL the refundable fares are both 1894 on the nose.

AC prices are decent BOS-LHR-BOS, just not the other way 'round.

So if you want to blame anyone I'm afraid it's BA's fault

barts

Thanks Zorn!

The prices from LHR to BOS/LGA/ORD have been decent and competitive up until this recent raise. I bet the number of airlines competing in that market makes them decent compared to LHR - Canada market.

Usually i got them for about $2000-2200. Now that the refundable fares on AC are at $2700 to BOS/LGA it is getting out of my range of reasonability. I can get J seat on another airline for less $$$. My theory is that AC is testing what the elasticity of their product is - raise prices and see what the drop in bookings is. If they can get away with the higher prices, they make more money and that's what every business is about. If they can get more money for flex economy than J seat on another airline, good for them!!! That means their product is superior to many other airlines. I don't view it as superior enough to other airlines so I guess my $$$ will be revenue lost to AC. I guess I will wait a little bit see if they drop them, if not I will have to look for another frequent flyer program.

Shareholder

Quite honestly I cannot conceive of why anyone living in NYC, BOS or these other cities would even contemplate flying AC to LHR, particularly on a fully flexible economy ticket other than to get a confirmed upgrade to business if they are an AE/AC elite member. Afterall, why go through the hassle of connecting at YYX or YUL, going through Canadian immigration/customs, etc. when you can get a non-stop from those same cities on dozens of airlines for much less?

If AC wants to set the fare at this level, it is not likely concerned about losing much business, since there was likely very little to begin with. Matching US fares to LHR from these US cities is just an exercise in topping up tarriffs, and not really intended to generate much real business.

And once more I return to my main point, can you get a cheaper Exec/Business Class ticket ex-NYC/BOS/etc. on a STAR carrier for which you'd earn mileage...I know there are several all-Business carriers offering low fares, but you're doing this to earn mileage.

barts

Shareholder - a few suggestions that i can give you why someone would want to fly from BOS or LGA to LHR on AC via YUL or YYZ is a few examples from my own life - my parents live in Canada, I work in LHR for a Canadian company with headquarters in Toronto but a larege presence in Montreal, we also have large presence in ORD and East Coast. So my travel is both business and pleasure. And the easiest way to do that is fly AC. Stop over in Canada for more business meetings and visit family. I could be and isolated case but only AC knows how much business they get from the US cities to LHR on flexible fares. Yes I did pay more $$$ for doing this vs flying non stop but I viewed it as a convenience fee. With the higher Y/M fares the convenience fee just got too high for me. If I was the top up tarriff, well, that top off just disappeared.

Yes mileage and upgrades is one of the reasons I am loyal to AC but it is not the only one. It is always a balancing act between price, points, schedules and class of service. Up until now, the net result always favored AC. With the fare rise, equation has changed and AC is no longer optimal. I wish it still was as it makes my life way simpler.

I just found a fully refundable business class fare on LOT on a LHR-WAW-ORD routing for GBP1111, about 2222USD. I think that is what I will do, even if i have to buy an ORD - LGA ticket it still comes out less than flying AC on a flex economy. And I get 1.25x miles for flying J. Seems like a win for me on all fronts.

Shareholder

You never mentioned a thing about StopOver in Canada thus raising the only reason someone would do this. But I still wonder why AC should subsidize your visit to family and company? Of course with all those airlines flying from NYC there is lots of dumping of seats into the market, even business class ones. In the meantime, I am sure AC will be overselling every seat it has to LHR this summer, so the loss of your business won't make it reconsider the fare adjustment.

cstead

How much of the pricing anamoly has to do with the valuation of the CAD at the moment? In the last few weeks, I think it's rallied quite a bit.

barts

CAD went from 1.18 to 1.125 - it is about 4.66% stronger vs USD. So on a $2000k ticket, the price should have gone up by $93USD. Explains part of the hike, thanks!!!

Confused a little bit about how AC is subsidizing my travel? As far as I could tell, I was paying a premium over what I could have paid with other airlines. Where is the subsidy and how much is it?

I hope AC can sell all of their seats to and from LHR at premium prices. It would be great news for them and I wish them good luck. Market forces will tell whether this can last or not. Meanwhile I will have to look at other airlines first for flying and second for moving my frequent flyer program to.