anc-ord772

Those days are over. More importantly they should sell all upgrades equally, elite or not. UA messed up by keeping upsells from elites, or charging higher prices to their best customers. Pray AA doesn't think that's a brilliant idea.

brp

But I don't see the "forced to predict" part. At T-24, they know exactly how many elites have requested upgrades to that point. Then, the only additional people are those who initially request within 24 hours. If these are people that bought earlier and didn't request...no sympathy from me. If they are just now buying, they already know that upgrade chances are low.

But, for people that have already requested, there is no mystery as to how many there are (and the assumption that anyone who has had a request on file for 2 months is going to want to go onto the airport list is generally a pretty good one). So, as a result, they really should never get this wrong...and it certainly shouldn't impact anyone who requested at booking.

Cheers.

Science Goy

Are they really? Reputable sources say they aren't.

anc-ord772

Good. I'd like the music to play a little longer.

Mark_T

OK, so at T-24 say they have 3 people left on the list and 5 empty seats in F.

Let's say RM experience on the route suggests that they are unlikely to get any walk-up fares so they are currently expecting to go out with 2 empty seats in F.

They need to get those seats sold so they believe they need to offer LFBU via OLCI, to maximise the chance of making the sale, but if they clear the upgrade list and sell both seats they would have to turn down an unexpected walk-up.

If they wait to offer LFBU until the last minute they will probably not sell the seats.

So they offer the LFBU and hold the upgrade list until the GA works the flight.

This keeps the option open to sell a last minute walk-up or handle IRROPS, but at the cost of having to deny an elite upgrade if it happens.

From a flight by flight revenue perspective that gives them the best return.

As long as it doesn't annoy the elites too often then it looks like a good risk.

Let's face it, a lot of the time the length of the upgrade list at T-24 is going make it impossible to offer LFBU anyway so it isn't even an issue on those flights.

Then for the flights where it does come into play the majority of the time they should get it right an no elites would be inconvenienced.

So we are worrying about what should be a rather small percentage of total flights.

This system does not guarantee that a non-elite will never get upgraded in place of an elite but it does ensure it should be a rare occurrence and is balanced (in the eyes of AA at least) by a general increase in premium cabin revenue.

mvoight

There are quite a few non-elites out there who are willing to pay for an upgrade at the gate. If this is an issue, then why leave elites out of the opportunity to buy an upgrade at check-in? That is better than making a statement where most elites believe they would not lose out on an upgrade because AA is selling them to non-elites. True the statement leaves room for AA to do this, but distorting something doesn't make it right.

beerup

No there is not uncertainty in the number of elites on the list at T-24, but RM like to have a contingency buffer for walk-up tickets and re-accommodation of distressed passengers. It is whether the all the seats in the buffer eventually becomes available for upgrade that is uncertain.

On the routes I fly it's typical for ~4 seats in F to be held back until ~T-5 and then 1 seat is held back for clearing at the gate. Now assuming RM is not going to change the number of seats they hold back in the buffer and the times they release them, then it poses a problem for selling the last seats as upgrades. If they want to actually sell the remaining seats at a good price, they need to be offering them for sale as early as possible. Therefore, the LFBUs cannot come out of the buffer.

For example, if at 24hrs there are 8 seats available but only 4 elites waitlisted for upgrade, AA may decide to try to sell 4 LFBUs. In that case, they would hold back three elite upgrades until T-5 and one until T-1. In other words, the upgrades are treated as if the flight is F4, not F8. The decision on how many LFBUs to sell was made based upon the size of the waitlist and so it is planned that they would not deprive elite upgrades. However, it is the elites that have the risk (which is presumed to be small) of the buffer being used for the contingencies it is held back for.

It seems like this plan makes sense in terms of filling every seat in F and maximizing revenue, but it does mean that under some (unintentional) circumstances there will be flights where LFBUs were sold, but elites did not clear the waitlist.


Edit: basically what Mark_T said above (I had to answer an email in the middle of writing my response)

brp

I see the point you guys are trying to make. I might, then, sell one less LFBU than that apparent float, leaving one seat for contingencies, while covering the elites. If, after some time, it seems that this seat really does go out empty a large percentage of the time, I would jigger the approach....or do it on a flight-by-flight basis.

One thing not addressed here is the Y oversell, and that seems to be happening more regularly, Two of our four legs this weekend had that. In this case, they hold more seats while reducing inventory. They wouldn't be able to sell these at OLCI because they need to hold them. In the end. they seem to go to upgraders (closer to departure time) to free up Y space. This works well for EXP as we've always gotten our upgrades in these cases, but would thwart the LBFU-for-sale-at-OLCI mechanism.

Cheers.

beerup

They don't want to charge elites for an upgrade when they believe that the elite will be upgraded anyway. One could argue that for PLT and GLDs who buy stickers for upgrades, the LFBU may be a good way of guaranteeing their upgrade without too much additional cost. However, the point is that their upgrade is pretty much guaranteed if LFBUs are being offered.

My guess is that by opening up LFBUs to OLCI, there is more opportunity for sales and so AA may be able to increase the price of LFBUs to make them significantly higher than the cost of stickers.

Score8

Right, but the cause of issue is that AA needs cash likely a bit more than they need to reduce real or perceived liabilities. If AA sells an OLCI or other upgrade to a non-elite, this is pure cash inflow - nothing better than that, really. Plats and Golds (who have in many cases already purchased or earned stickers) are perhaps liabilities that AA can unwind (but don't necessarily produce incremental cash). This is assuming that ultimately AA would permit the use of stickers on OLCI or kiosk upgrades. EXP's, on the other hand, get 'free' upgrades and thus, in some adverse way, make those upgrades the most lucrative to supplant or replace. Absent the ability to use stickers, we're all sunk cost as elites.

I've only ridden in coach once this year (ORD-BOS), and I fly on moderate to heavy elite routes. So, if there is some reduction in EXP benefits, I haven't really noticed. However, you could easily see how yield mgmt could disrupt our elite system in order to generate incremental revenue.

JohnDCA

If there is anticipated availability in First several days before a flight, US Airways sends an email that allows a non-elite passenger to enter their credit card information for a space-available upgrade. If there is still availability 24 or so hours before the flight, the upgrade clears and the credit card is charged. I like this because I clear 3 days out as a Gold Preferred and the lowest tier clears two days before the flight, so it doesn't really affect me.

I'm not sure if said non-elite would be put on a standby list if there wasnt upgrade space, but this seems like a good system to me and would perhaps work for AA if they said it will clear ~4 hours before flight time or would put the non-elite on the priority list for an upgrade.

vail

Another new scheme is that to the Caribbean AA is offering special business class fares that are slightly higher than the discounted coach fares.
The price is slightly higher or in some cases equal
to the cost of stickers for that route.
So for non elites that want to sit in J it is as if you were a Platinum.
For elites the Cabin is sometimes full before 72 hours.

There is no end to the nonsense that AA keeps coming up with.
If they would spend half that time running a decent airline travel would not be where it is now.
I guess I get to look forward to a fleet of the future consisting of 737's--what an advance in air travel.

NauticalWheeler

I too have noticed that AA has become much more aggressive in pricing F class. As an example, I recently priced a ticket on Labor Day. Y was priced at $274 while F was priced at $423. I elected to take F. Two flights of approximately 750 miles each (meal service on both,) complimentary drinks, and complimentary checked bags.

Airlines are going towards a model which offers more frequent flights and smaller planes for domestic and short to medium haul international routes. We will all have to get used to it.

abk

I actually bought one of these to insure I was in J and sure enough at 100 hours the front was almost completely full.

nrr

The OP was going to contact AA CR on Monday, 8/20/12--shouldn't we have heard some "official" news (from him) re AA's (new?) policy by now?