C17PSGR

Uggg... I hope they keep in mind that in the business travel world they are competing against webconferencing and Virgin. I'll connect through DFW/ORD/PHX/LAX so I can fly AA and usually get upgraded. The benefit to my employer is that I can work (at least on AA metal with power ) in First whereas when flying on DL, I have to bring a book since there is no power or room to work.

GUWonder

I'm pretty sure that these fares won't be "only sold as roundtrips". Expect it to hit one-way tickets.

And last I checked, a lot of business travel happens at times that are neither "noon-Sunday through noon-Monday" nor "noon-Thursday through noon-Friday".

kettle1

What DL airline are you talking about? Do you not have status with DL? Perhaps that is why you are not getting upgraded? As for power I have no problem on almost every DL flt. I travel 3-4 times each week on DL, AA, UA and other carriers.

Fanjet

And??? Are you worried that AA is going to now lose revenue because all of their business travelers will be purchasing these fares, and not higher ones? I'm sure AA appreciates that concern.

I know we all love our free upgrades off of any fare type. But if travel departments require the lowest available fares to be utilized by their employees, then so be it. It's not like they would be able to book another carrier (at a higher fare) if that's the case. Correct?

Stripe

Indeed. I'm now seeing DL E fares on routes like AUS-DTW which have no direct competition from the likes of Spirit. DL first introduced them as an answer to Spirit but they have now taken on a life of their own.

bse118

My company's travel system allows me to do just that...select my preferred carrier, even if its not the lowest fare carrier.

What it doesn't allow me to do is select a higher fare class, than the lowest one currently being offered by my carrier.

e.g. if DL is $200 and AA is $275. I can book AA. But if a new AA "E" fare is $275, and a say Q fare is $300, I have to book the "E" and not the Q. In fact the system won't even display the Q.

So yes, I am worried about being forced to book these fares, and not being able to book ones with that have normal FF benefits. And I'm not talking about domestic upgrades.

theAAstudentBOS

+1

Same here. But I think what is interesting here is the 87% vs 13% mark. What surprised me wasn't that the revenue difference was so high- 13% of flyers representing 50% of revenue- but who qualified for the 13%- everyone who flew AA more than once a year!

So someone like me- an extremely cost-conscious flyer (as a student), who will have flown about 40k miles on AA by this year's end, counts in the 13% - and is even significantly more important to AA's bottom line than a good portion of the other 13% percent of flyers, since I fly 5+ trips on AA a year, some international.

Reading Flyertalk, you'd think a lowly Gold like me or the poster above don't mean much to AA. But while obviously EXP's mean more, Golds represent a much larger fraction of revenue than perhaps we think- meaning that those flyers who fly for small/medium businesses, who don't have corporate accounts, are probably as important in aggregate as the smaller number of EXP's. (I'm speculating, but you see what I'm getting at).

Meaning, AA has to protect/compete for those flyers as much as they have to for EXP's. So the unbundling would, perhaps, not be as damaging as my worst nightmare. At least, that would be my hope.

So while this above is often mentioned here, I don't know if this is exactly how AA management is thinking. First, for the reasons of the revenue breakdown I mentioned above. But second, they wouldn't have so many challenges if they wanted fewer EXP's! Like they may just be milking now before a big drop in benefits (and they have done that), but this is PLT and EXP- if 13% of flyers who fly once a year on AA provide 50% of the revenue, then how much of the revenue is being provided by the 1-3% of flyers who fly 10+ times? They can't afford to pump then dump them, I'd argue.

But we'll see

iceman06

AA has to be very careful that in going after half of their revenue represented by once a year fliers they don't risk losing the other half represented by their loyal frequent flier base, which they've tried so hard to protect and expand, and which they view as on of their strongest competitive advantages. At least it would be my hope that they understand it. It makes no sense to poach fliers from UA and DL only to stick it to them later. But I'm not the one making decisions...

sethb

What if AA "E" fare is $275, Q is $300, and DL is $350? Now you could book the $350 fare but not the $300 fare?

Fanjet

Which is an issue between you and your employer. And not an issue as to AA offering the flying public lower fares. @:-)

Y'all remember when people were complaining that this merger, coupled with the DL/NW and UA/CO ones, were going to drive up airfares? So what happens when DL-- and now AA-- decide to offer a lower fare option? They complain about it.

sethb

Is it a lower fare option? Or is it the same as the previous lowest fare, just with less value, and all the benefits (like seat selection) that used to come with the lowest fare now cost more?

Fanjet

Well... since they are saying these fares are to compete with carriers like Spirit, why wouldn't they be lower? If Spirit was charging $100 OW between XXX and YYY, and AA was charging $150 for a "G" or "O" fare, how would AA be competing with Spirit if they still charged $150 and provided fewer benefits than before?

Back in the 90's, the legacy carriers created their low-cost entities to compete with the rise of LCCs. And they lost a ton of money doing so. This fare structure allows them to do so without the need for sub-fleets. Or different crews.

GUWonder

Before 2003, neither Ted by United nor Song by Delta were yet in existence. Which low cost carrier within a carrier did American operate in the 1990s or even in the 2000s? I'm not sure who needs to check their industry history, but revisionist history doesn't really fly for me, so I look forward to any information of relevance that applies to AA, DL and UA in the 90s.

It's quite ordinary for AA prices to be higher than NK fares for the same non-stop routes on the very same dates, even for flights at around the very same time. And yet that is even as AA is competing with NK -- even as some travelers avoid NK like they want to avoid the plague; even as many buyers of travel never see an NK option for the very same city pair as AA even when NK still has plenty of cheap fares available for sale for the same city pair on the same date.

With DL, I've been seeing the E- fare often as a higher priced option than NK. The DL fare might be a lower fare compared to DL's other fare but that doesn't really say anything about it being a lower or higher price than before. It often ends up being a "competitive" fare -- more or less the same price as before -- with just less value/benefits for the passenger.

aztimm

I really don't understand why everyone is upset.

The same management team said the same exact thing ~10 years ago when HP and US merged. Heck, the, "new US," stock symbol was LCC.

Within a year or so, things got back to normal.

sethb

It's called "advertising" (also "lying"). "Our new low-service fares are to compete with airlines that provide less service."