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BA Enhances its short haul economy fare structure

BA Enhances its short haul economy fare structure

Old Feb 25, 2016, 8:59 am
  #76  
 
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BA Enhances its short haul economy fare structure

Since there is so much speculation as to whether changes to make all with-luggage fares flexible will lead to a significant price increase, perhaps some guesswork on why BA might want to do this is called for.

At the moment there are real issues with excess hand luggage (hence yellow tag system) and HBO fares have become the norm for many customers, especially business customers.

Product difference between HBO and other fares was minimal (just a lower price for someone who would not normally have taken checked luggage anyway). Hence problems outlined above.

BA's initial response was to remove seat selection for status passengers (to a great deal of noise and complaint as we all know).

Meanwhile competition is offering more business friendly products like U2's flexi fare with free transfer to an earlier flight.

Against that background BA have adopted a model that looks like FlyBe or EI with a key feature previously conceded to U2.

If BA were now to charge its new semi-flexible with-luggage tickets at the old semi-flexible rates (which could be HBO or not), it would have a real competitive problem. More people would be pushed to HBO fares or, if needing luggage, would be looking elsewhere. The hand luggage problem would get worse.

Alternatively, if BA keep the new semi-flex fares at more or less the old with-luggage levels across all discounted fare buckets, what do they gain? Those complaining that they are not going to pay a with-luggage fare just for free seat selection now find it has another valuable benefit - free same day changes plus fare difference changes in advance. More are likely to opt for this fare and justifying it under corporate travel policies is easier - it's flexible (with luggage) vs inflexible (HBO).

By doing this BA remove a competitive advantage from a rival, address the hand luggage problem, gain some additional revenue and praise from frequent flyers for a genuine enhancement.

[I can't imagine BA moving holiday fares into HBO - even seasoned travellers often take luggage on holiday! That would be a poor commercial judgement and perhaps indicates that the new with-luggage fares are not likely to be exclusively high cost fare buckets.]

That, I would hope, is what is happening here.

If that is correct, two other issues remain. Will TP earning be altered so that HBO fares only earn lowest level of TPs but with-luggage earn standard rate? Will other status benefits such as lounge access be removed from HBO fares?

Perhaps BA is being coy on this because it has not decided to make these changes or perhaps it has not been mentioned them to avoid souring what could be a very positive announcement and this will slip out on a bad news day nearer the time.

Anyway, like so much of this thread, pure (but hopefully reasoned) speculation on my part.
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Old Feb 25, 2016, 9:03 am
  #77  
 
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There necessarily will be a trick to this.

If there are two flights 6 weeks out and checked bag fares are: 0800 at Ł200 and 1400 at Ł50.

Why won't I book the late plane and ring up at 6am to try for the expensive 0800 flight? If I fail, I catch the plane I booked. Otherwise I get on an expensive service for a dirt cheap fare merely because there was a seat in the same cabin available. On a route with lots of flights a day, booking the last/cheapest flight of the day could work very well.

There may be a rule that says the same or cheaper fare bucket must be available for a switch without a fare difference being charged. It doesn't say that in the PDF though.

Or the semi-flex fares will be set with a baseline fare that means these kinds of games don't make sense.
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Old Feb 25, 2016, 9:17 am
  #78  
 
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Originally Posted by PheonicianTrader
There necessarily will be a trick to this.

If there are two flights 6 weeks out and checked bag fares are: 0800 at £200 and 1400 at £50.

Why won't I book the late plane and ring up at 6am to try for the expensive 0800 flight? If I fail, I catch the plane I booked. Otherwise I get on an expensive service for a dirt cheap fare merely because there was a seat in the same cabin available. On a route with lots of flights a day, booking the last/cheapest flight of the day could work very well.

There may be a rule that says the same or cheaper fare bucket must be available for a switch without a fare difference being charged. It doesn't say that in the PDF though.

Or the semi-flex fares will be set with a baseline fare that means these kinds of games don't make sense.
But it depends on the rules and availability.

I am not sure whether the free same day change applies to the outbound or just the inbound.

Also, where a flight is considerably more expensive, it normally indicates it is likely to be pretty full. If it is full, then a same day change won't be permitted.

Great to see we are already trying to work out how to game a system that hasn't even started
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Old Feb 25, 2016, 9:17 am
  #79  
Ziz
 
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This might actually make me more inclined to purchase non-HBO. I often find myself wanting to change travel plans but being put off by the change fee. I might occasionally spring for the non-HBO when I think there's a chance I'll want to change my plans.
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Old Feb 25, 2016, 9:19 am
  #80  
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Unless I've missed it, no-one seems to have asked about implications for mileage and TP earning? For BAEC and partner programmes.
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Old Feb 25, 2016, 9:37 am
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Originally Posted by dsf
Unless I've missed it, no-one seems to have asked about implications for mileage and TP earning? For BAEC and partner programmes.
HBO will likely be no different and the with luggage fare will now likely be better than it is currently. Fully flex probably no change
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Old Feb 25, 2016, 9:39 am
  #82  
 
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Originally Posted by Ziz
This might actually make me more inclined to purchase non-HBO. I often find myself wanting to change travel plans but being put off by the change fee. I might occasionally spring for the non-HBO when I think there's a chance I'll want to change my plans.
Agreed, but the devil is in the details. E.g. if arguendo B, H and K are semi-flex booking classes, will the same day flight change on a K fare allow you to move to a flight with Y4 B2 H0 K0 M0 L0 on the morning you want to make the change?
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Old Feb 25, 2016, 9:53 am
  #83  
 
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As one who often takes advantage of the "flight+hotel" offers which are often quite good, would the flights on them now be "with checked baggage" or "hand baggage only". They used to be with checked bag but often had tight flight changes on them?
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Old Feb 25, 2016, 9:57 am
  #84  
 
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Originally Posted by cynicalmoose
Agreed, but the devil is in the details. E.g. if arguendo B, H and K are semi-flex booking classes, will the same day flight change on a K fare allow you to move to a flight with Y4 B2 H0 K0 M0 L0 on the morning you want to make the change?
This is not rocket science. If Y has 1 seat and the plane leaves more than an hour away, then yes of course you can change.
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Old Feb 25, 2016, 10:31 am
  #85  
 
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Originally Posted by james_yuen
As one who often takes advantage of the "flight+hotel" offers which are often quite good, would the flights on them now be "with checked baggage" or "hand baggage only". They used to be with checked bag but often had tight flight changes on them?
I cannot see why BA would want to suddenly change its "holiday" fares (these are sold by BA holidays and include ABTA protection) to hand baggage only.

It may be stereotyping, but a popular view would be: HBO = business, with-luggage = leisure. Making holiday bookings HBO is not consistent with this.

Similarly, I cannot see any reason to change redemptions (these are already fully-flexible). Why strip out the luggage allowance?

To my mind, these changes are part of a strategy to rebalance the relative attractiveness of HBO vs with-luggage fares. We have had the stick (no HBO seat selection for status passengers); now with have the carrot (semi-flexible fares with free same day changes on with-luggage fares).
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Old Feb 25, 2016, 10:34 am
  #86  
 
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I think that BA are not making ANY changes to the fares except eliminating the standard (V1 fare basis). Right now we have four fares (HBO Z0, Standard V1, Semi-Flex V2, Fully-Flex V3). The document says that from March 8th there will be three (HBO Z0, Semi-Flex V2, Fully-Flex V3). I think it is wishful thinking that any fare pricing will change for Semi-Flex - it is clear that all is happening here is removing the Standard choice offering.

Moreover the features advertised for the new Semi-Flex are the same as for the current Semi-Flex - no changes whatsoever.
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Old Feb 25, 2016, 10:48 am
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Originally Posted by radui
I think that BA are not making ANY changes to the fares except eliminating the standard (V1 fare basis). Right now we have four fares (HBO Z0, Standard V1, Semi-Flex V2, Fully-Flex V3). The document says that from March 8th there will be three (HBO Z0, Semi-Flex V2, Fully-Flex V3). I think it is wishful thinking that any fare pricing will change for Semi-Flex - it is clear that all is happening here is removing the Standard choice offering.

Moreover the features advertised for the new Semi-Flex are the same as for the current Semi-Flex - no changes whatsoever.
Would there be any effect on gold-only redemption availability?
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Old Feb 25, 2016, 10:55 am
  #88  
 
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Originally Posted by crazy8534
Would there be any effect on gold-only redemption availability?
No, that is governed by inventory buckets not fare bases
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Old Feb 25, 2016, 11:11 am
  #89  
 
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Originally Posted by radui
I think that BA are not making ANY changes to the fares except eliminating the standard (V1 fare basis). Right now we have four fares (HBO Z0, Standard V1, Semi-Flex V2, Fully-Flex V3). The document says that from March 8th there will be three (HBO Z0, Semi-Flex V2, Fully-Flex V3). I think it is wishful thinking that any fare pricing will change for Semi-Flex - it is clear that all is happening here is removing the Standard choice offering.

Moreover the features advertised for the new Semi-Flex are the same as for the current Semi-Flex - no changes whatsoever.
I am not sure that this is right.

What matters is what fare bases are sat under each heading.

Taking Europe to LGW as an example. At the moment the following fare bases sit under each heading:

HBO: O-Q-N-S-V-L-M-K-H
Standard: O-Q-N-S-V-L-M-K-H
Semi-Flex: B
Fully-flex: Y

If this is correct and the Standard category is just abolished, those wishing a fare that includes baggage will need to pay for a B (or even Y) fare. HBO will cover all of the discounted fares and there will be no advanced purchase discount to anyone wishing to take checked luggage.

The consequence would be more HBO fares sold, may be more HBO fares sold with luggage purchased (which would look much like an old standard fare, but without seat selection and involving more hassle to book) plus more customers going to airlines that offer more straightforward and transparent pricing.

Given that the stated aim of this exercise was to streamline the number of variants and make things simpler for the passenger that sounds very odd.

An alternative would be to realign the fare basis codes to reflect a new distribution after the elimination of the standard category. That could include realigning all the discounted basis codes under the semi-flex heading so that they become semi-flexible when sold as a with-luggage combination and perhaps reducing the number of codes under the HBO heading. Whatever happens in the latter case, anything sold as HBO will not have semi-flexible terms if sold under that heading.

Until BA issue a table showing the distribution of fare basis codes to the three new headings (HBO Z0, Semi-Flex V2, Fully-Flex V3), it is impossible to determine whether electing to check luggage has just become very expensive or brings much more flexibility for the old price.

However, unless BA has finally decided to become a fully-fledged LCC, I cannot for a moment imagine having to book a minimum of a B class fare to be able to check a bag in economy.
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Old Feb 25, 2016, 11:44 am
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Originally Posted by cynicalmoose
Agreed, but the devil is in the details. E.g. if arguendo B, H and K are semi-flex booking classes, will the same day flight change on a K fare allow you to move to a flight with Y4 B2 H0 K0 M0 L0 on the morning you want to make the change?
Originally Posted by 710 77345
This is not rocket science. If Y has 1 seat and the plane leaves more than an hour away, then yes of course you can change.
Just re-read the OP and the Speedbird Club PDF. I AM surprised. Wow.

...upon payment of the fare difference.

Maybe I'll be wrong, but I would be VERY surprised if BA were to move to same day changes without collecting any fare difference. Not collecting a change fee is a big policy change for BA in itself. The comms still mention fare difference applies for any changes, I really wouldn't be expecting the fare diff to also be waived when changing to a more popular flight, just because I was changing from semi-flex M to semi-flex K (or whatever). There are different letter booking codes for a reason - to be able to have multiple price points.

Last edited by JAXBA; Feb 25, 2016 at 12:16 pm Reason: I had read the OP but missed the SDC part!
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