Parker Threatens End of Changes/Change Fees to Non-Refundable Fares
Sep 21, 2018, 10:48 am
#76
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Exactly. If the (now great) differential between discount non-refundable tickets and flex tickets remains unchanged, that will scramble buying patterns in business and leisure cohorts alike. If an unchangeable K or Q ticket is $400, and a refundable Y ticket is $900, are people with un-firm plans going to pony up for Y? Buy low and possibly eat $400? March over to WN, F9, or Amtrak/driving (viable on +/- 500m trips)? Or just not travel?
In the business world, at least, AA does not compete against UA and DL. It is competing against Skype, Zoom, and WebEx.
Southwest carried more passengers in 2017 than any other US airline -- 157.6m. Adding domestic and international together, DL, AA, and UA trail Southwest -- UA's enplanements, 107.2m, were only 68% of WN's. DOT table here.
The smug FlyerTalk view of Southwest as this eccentric, grubby last-resort alternative that appeals to no truly refined person is objectively ridiculous. Most of the things WN lacks (F, lounges, intercontinental routes) are irrelevant to many, even many HVFs. In this context FT is the eccentric view.
Note that WN's share of the business travel market has risen steadily in this decade even though it does not serve HKG or CDG. The question in Doug Parker's office has to be whether more restrictions on discount tickets would further accelerate that trend.
It sure would for me. I have clients with fluxy calendars who would not happily eat very many $400 K tickets, would balk at $900+ Y tickets, and would likely respond by narrowing the options to: Southwest or Skype.
In the business world, at least, AA does not compete against UA and DL. It is competing against Skype, Zoom, and WebEx.
Southwest carried more passengers in 2017 than any other US airline -- 157.6m. Adding domestic and international together, DL, AA, and UA trail Southwest -- UA's enplanements, 107.2m, were only 68% of WN's. DOT table here.
The smug FlyerTalk view of Southwest as this eccentric, grubby last-resort alternative that appeals to no truly refined person is objectively ridiculous. Most of the things WN lacks (F, lounges, intercontinental routes) are irrelevant to many, even many HVFs. In this context FT is the eccentric view.
Note that WN's share of the business travel market has risen steadily in this decade even though it does not serve HKG or CDG. The question in Doug Parker's office has to be whether more restrictions on discount tickets would further accelerate that trend.
It sure would for me. I have clients with fluxy calendars who would not happily eat very many $400 K tickets, would balk at $900+ Y tickets, and would likely respond by narrowing the options to: Southwest or Skype.
Contrary to what FTers would like to think, most business travelers don't get a damn about the type of a/c, the attitude of the FA, a cheap $5 domestic F meal or the right to brag about their upgrade percentage, or conversely ..... about their lack of upgrades. They'd rather get home and spend quality time with family or friends than sit in the DFW AC drinking cheap free booze and eating the same old finger food.
Sep 21, 2018, 11:08 am
#77
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Exactly. If the (now great) differential between discount non-refundable tickets and flex tickets remains unchanged, that will scramble buying patterns in business and leisure cohorts alike. If an unchangeable K or Q ticket is $400, and a refundable Y ticket is $900, are people with un-firm plans going to pony up for Y? Buy low and possibly eat $400? March over to WN, F9, or Amtrak/driving (viable on +/- 500m trips)? Or just not travel?
What other option is there, really? They've already stratified the offering - basic economy already doesn't allow changes. Why would Parker feel the need to go out there and threaten the end of changes when they've already done that for a segment of passengers for whom that's acceptable? I guess they can further segment the fare offerings, but didn't they effectively already try that with the choice/choice plus or whatever bundles? And I guess that didn't work? Will we see maybe more of the lower main cabin buckets be non-changeable (but allow seat selection, overhead access, etc.)? Will AA improve its website to more clearly display the rules of the fare???
Sep 21, 2018, 11:41 am
#78
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Interestingly, Frontier has changed their change fee policy:
https://www.flyfrontier.com/travel/t...campaign=3Tier
https://www.flyfrontier.com/travel/t...campaign=3Tier
Sep 21, 2018, 2:45 pm
#79
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This is all posturing from Dougie. The big difference between airlines and hotels is that hotel flexible bookings are not 3x the price of non-refundable bookings. The big difference between airlines and concert tickets, sports tickets, etc. is that they are yours to resell if you can't use them. Unless either of these things change at the same time, he knows ticket sales will plummet massively if they actually did this.
Sep 21, 2018, 4:21 pm
#80
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While it won't chase away *ALL* of AA's customers to WN, it certainly has to chase away a percentage of them. They serve some non-Southwest cities, including international.
Just one more reason that I would have no interest in flying with them unless absolutely necessary.
Even those who don't jump ship to WN may jump to DL or AA where a change fee is better than a throw-away ticket.
Just one more reason that I would have no interest in flying with them unless absolutely necessary.
Even those who don't jump ship to WN may jump to DL or AA where a change fee is better than a throw-away ticket.
Sep 21, 2018, 5:44 pm
#81
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I always thought that Big Government was the worst possible actor, but Big Business that is a monopoly is only marginally better.
We need stronger anti-trust enforcement and elimination of barriers to entry for new airlines. That would solve this situation and would be a more appropriate use of government than for Congress to try to micro-manage how a company prices its products.
We need stronger anti-trust enforcement and elimination of barriers to entry for new airlines. That would solve this situation and would be a more appropriate use of government than for Congress to try to micro-manage how a company prices its products.
Sep 21, 2018, 6:02 pm
#82
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While it won't chase away *ALL* of AA's customers to WN, it certainly has to chase away a percentage of them. They serve some non-Southwest cities, including international.
Just one more reason that I would have no interest in flying with them unless absolutely necessary.
Even those who don't jump ship to WN may jump to DL or AA where a change fee is better than a throw-away ticket.
Just one more reason that I would have no interest in flying with them unless absolutely necessary.
Even those who don't jump ship to WN may jump to DL or AA where a change fee is better than a throw-away ticket.
I suspect that it would lead to the medium fares upwards allowing changes at the new reduced maximum change fee with the cheaper ones being non changeable
I dount that it would lead to the extreme of buying fully flexible/fully refundable or non changeable/non refundable
Sep 21, 2018, 6:31 pm
#83
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Easily compensated for. The overbooking algorithm will sense this and overbook by more seats. And to the extent that seats do go empty, that will also reduce fuel costs. Figure maybe 150-200 pounds per passenger including checked and carry-on bags? Ten passengers don't show, and you've saved a ton that you don't have to burn fuel flying around.
Sep 21, 2018, 11:55 pm
#84
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ID was required before 9/11. Sometime in the mid 90's the gate agents began checking photo ID with the boarding pass to insure the name matched. So selling/buying a ticket with someone else's name on it was not possible. It was, however, possible in the years leading up to around 1995. Don't ask me how I know this.... 
Sep 23, 2018, 9:23 am
#85
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I'm pretty sure the policies required the passenger had a govt. issued ID like drivers license, state ID, passport, etc. but in your situation I guess the agents weren't really paying attention.
My point was that up until the mid 90's, security agents at the checkpoints and gate agents weren't required to check ID's at ANY point of the trip. Then they began checking at the gates sometime circa 1995, and then TSA took over post 9/11.
Last edited by PHL; Sep 23, 2018 at 9:28 am
Sep 24, 2018, 3:41 pm
#86
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Faulty observation in article: "Doing away with changes to nonrefundable fares would make airline flights more like baseball games or concerts, where customers aren’t typically reimbursed if they buy tickets and can’t use them... "
Stubhub allows you to do just that....
Stubhub allows you to do just that....
1. "The airline needs to know who is on the flight, for 'security'."
All it needs to know is the name and contact for the current owner of the ticket, so that it can verify that the owner has actually transferred the seat, rather than having been hacked. There is a smidgen of labor attached to this, but being an IT guy I know that a flat name-change-for-any-reason fee of $50 will still generate a profit. The security part, verifying that the name on the boarding pass matches the documentation he is carrying and that he is not a flight risk, is the TSA's job. Any higher name change fee is airlane robbery.
2. "Transferability would mean that scalpers would buy up every ticket months in advance and hold everyone else up for whatever price they could get away with."
Those mustache-twirlers would have to be able to come up with a ginormous amount of money to do such a thing, and would still guess wrong so often that would be broke within a week. Why would that be? Because the airlines themselves run the best yield management software in the world, pricing each ticket at exactly what the market will bear given city pair, date and time-to-flight. No scalper is going to be able to outguess this system.
Sep 24, 2018, 6:09 pm
#87
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There are plenty of sporting events that do not permit transfer of tickets to other people - e.g. Winbledon tickets are issued in the name of a person and id is checked
Regardless , you are entering into a contract for carriage of a person, not the purchase of a seat
Regardless , you are entering into a contract for carriage of a person, not the purchase of a seat
Sep 24, 2018, 8:12 pm
#88
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Not at all shocked that you're taking AA's side again, but Wimbledon is a definite exception. Pretty much every other sporting event in the world allows for the resale of one's ticket.
Sep 24, 2018, 8:16 pm
#89
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Those mustache-twirlers would have to be able to come up with a ginormous amount of money to do such a thing, and would still guess wrong so often that would be broke within a week. Why would that be? Because the airlines themselves run the best yield management software in the world, pricing each ticket at exactly what the market will bear given city pair, date and time-to-flight. No scalper is going to be able to outguess this system.
Sep 24, 2018, 9:20 pm
#90
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There are many events that do not allow resale of tickets, not just wimbledon