American_Dane

Maybe some more experienced followers of AA's revenue management can riddle me this.

As the screen name might tip you off, I was very excited being a Philly area flyer to find out that AA was launching PHL-CPH service this summer. I've been watching prices for these flights since they went on sale.

To me, they've always seemed outrageous. In retrospect they were far less ridiculous at some points, when they went as low as $2000 round trip (I look at PE). They spent a lot of time at $2200.

Currently, for the late august dates I'm looking at..$2700.

Checking out expert flyers, I see four seats booked in the PE cabin out of twenty. What gives? Does AA really think they are getting this kind of premium (It's more than $1000 more pp than Newark) for this flight? Are they trying to fly with a low load factor and crazy high prices? Are they going to cancel these flights? Will they ever adjust? Give me your best crackpot theories.

ISTFlyer

If you are looking for PHL it's a captive AA market where most of the premium flyers have AAdvantage accounts, mostly prefer AA for their business travel for convenience, etc...
Trust me that while price conscious travelers would look for alternative options, those people who have 10-15 business days off or who can use 5 business days off at a time and rely on school holidays have no choice buying those fares if they would like would like to maximize vacation time.

AA and all other carriers know this algorithm and demand pretty well.
Those flights would eventually leave full, however, maybe not with OD passengers starting in Philadelphia, but someone who has bought a much cheaper Atlanta / San Francisco / Los Angeles - Philadelphia - Copenhagen flight which the passenger preferred AA over a SK non-stop flight due to the pricing.

USFlyerUS

FWIW, $2,000 to $2,500 or so for PE is not unreasonable during the peak summer travel months in my mind. It's a small cabin with a much better seat. AA will sell those seats at that price.

Bear96

It's yield management, not a crackpot theory.

Sure they could fill a flight in August by March 1 with super cheap tickets, but why? A lot of people who might be planning to travel in August haven't made their bookings yet.

As the departure date gets closer, if the seats are not selling for the prices offered as fast expected based on the extensive data they have, they will drop the prices.

brenc3

JFK tends to have much lower TATL fares due to high competition. BOS often isn't bad. But as others mentioned, $2-3k for PE in summer is not out of the ordinary. If you're finding fares $1k lower out of EWR, why not take that? It's a quick train ride up, certainly seems worth the money saved.

I was looking at ex-BOS TATL fares not long ago and saw late August fares much lower than July, so being flexible with both dates and gateways can help.

lrdpenn

I am also in the camp that the price sounds ok especially this far in advance. You can also buy a ticket to see what buy up offer you get and then cancel within 24 hours for a full refund.

Kacee

This is not AA. TATLs for this summer are expensive, across mainline carriers. From west coast, even cheapest Y is over $1500 for most routes/dates (with only exceptions being odd routings on EI, WS, or similar).

AndyAA

PE is coming into its own as a product, supplanting what used to be J, as now J prices can easily eclipse $5k from captive markets in a peak season.

prathetkrungthep

For a few years now I have been convinced that US3 simply have no idea how to properly price PY given they were much later to the game (compared to TPAC carriers like BR/CI/NH/JL or even TATL like BA/LH/LX/OS/AF), but honestly maybe they are doing something right since I very often see PY on AA rather full and seat maps filled at least a week out, suggesting that it's not necessarily filled with non-revs or pitied ExPlats whose SWUs didn't clear. That said, I have on a few occasions snatched PY for pennies on the dollar by going back in to check the fare differentials every now and then when holding a non-BE Y fare (one time I think I even got a few bucks back!)

All this is a very longwinded way of agreeing in context with everyone that 2k for TATL ex-PHL in PY over the summer sounds about right. If I were to hazard a guess, Y on the same route and dates is probably hovering around 1-1.3k?

FabCW

If you book ahead and have a bit of date/routing flexibility, you can score J seats on good airlines on TATL routes for $2200-2700, even in the middle of summer.

Being in a hub does however diminish your options.

American_Dane

Thank you for the help. (And all of the above as well, very informative). I am used to a different set of circumstances which is why I asked the question in the first place to get answers like this from more experienced people.

I could go up and fly out of Newark, what i've done in the past but I've switched my loyalty as I moved much closer to PHL than EWR and make 1-2 flights per month. Would like to try something different, in particular with the idea that SAS may abandon EWR when it joins Skyteam. I am definitely not interested in trekking to JFK.

This really helped me to make the decision clear, pretty much if I want to fly this way I am going to have to accept the price that it is. I will take the suggestion above and make a dummy booking in Y and see what the buy up is.

lrdpenn

Air france / flying blue has pretty good award pricing on both Y and PE out of NYC especially EWR. Worth checking if that's an option, although be aware some of the AF PE cradling seats have really poor reviews. I recognize going to EWR then connecting in CDG makes a relatively quick overnight trip a much longer journey though for you

lougord99

Perhaps not. We went ORD-LHR at Thanksgiving time. Booked well ahead in main cabin and watched PE. When we booked PE was about $1,800 and never came down. Plane went out with 2 people in PE and returned with at least half of PE empty.

xliioper

There are still dates with PE under $2000 on PHL-CPH in August, but you will have to fly mid-week instead of weekends. Aug 12th - 21st for example (below from Google Flights). If you want to get cheaper fares, you are going to have to make some compromises and fly on dates when there is less demand and also to meet the fare rule requirements for the cheaper fare filings. The $1865 PE fares below require outbound travel from US on Sun - Wed, and return travel from CPH on Tue - Thu. Flying outbound or return on other days of the week will bump you up into higher fares. The fare rule requirements can be found on aa.com at checkout page.

Bottomline, how empty a flight currently shows is not necessarily a significant factor in pricing. The airlines will adjust bucket inventory availability on flights up and down based on both current bookings and historical demand profiles (since many people have yet to book flights yet in the case of summer travel). And then there are the fare rule requirements which essentially bake in higher fares if you don't meet the rules for the cheaper fare filings (like mid-week travel).

Kacee

And the trend, which AA revenue management was late to join, is to hold out on offering discount inventory early. It's worked pretty well for the carriers the last two summers, with record demand for Europe travel.