Kgmm77

If you assume BA wouldn't do this unless its revenue positive (and given the cost control ethos in the company I presume every non-safety or compliance related change needs to wash its face to get approved), then that means unless the change attracts more new customers (and I can't see anything to indicate it will as the benefit isn't clear), then the average fare per customer must increase.

So you can construct a hypothetical that some customers might benefit, but more have to lose.

Ldnn1

The end of the free checked bag was years ago, when BA introduced HBO fares and thus began charging for checked bags. This new fare structure is a development of that.

dera

So what this means is, that if a GCH wants to select a seat on a SH flight, his ticket will cost about 100GBP more than before.
Good going BA.

DYKWIA

Please explain that to a simpleton like me...

EsherFlyer

The way I view it is that if you did a typical fare search you used to see 3 columns: HBO, Standard and Business. HBO would be about £30 less than Standard for a return.

On the next page you could optionally select semi-flex, which would anything from £20 to £200.

In the new world you csn have HBO, or semi-flex. So the lift above HBO can be anything from £40 to £250 for a fare that allows you to select seat

Dicksbits

If you hike prices, you don't fill planes. Punters look for cheaper alternatives with rival carriers. Simples.

orbitmic

That's absolutely the spirit of my post indeed - just two alternative narratives.

I do think the hand luggage problem is much exaggerated here, and that it only affects a few flights (certainly in my experience which does include weekly flights on a variety of routes), but even besides that, the notion that using fare structure to solve a luggage space problem (compared to optimising income) sounds very unconvincing to me.


I fully agree with the first point (HBO became default for most, hence lost income). The second point is factually wrong: HBO fares have excluded seat selection from the onset so cannot possibly be as a result of too many people buying it compared to expectations.

I do not understand that part of your argument. On the first point I'm saying BA want to keep the cheap lead price, not lower it - frankly, it cannot with its cost structure. What I am saying is that it cannot increase it.

Your argument is that leisure travellers who need to check in a suitcase will now be put off by the absence of an all inclusive fare and will thus revert to U2 while BA is simply following the U2 model for people needing cheap fares plus checked luggage: sell it as ancillary only rather than at discount. I do not see the logic of the argument. BA is simply following the U2 pricing model: moving to a low cost fare structure at the leisure level where customers add (more) to add a suitcase if they want to.

You seem to think that this will "force" more people into travelling HBO but if I may point that out, I think this flatly contradicts your earlier observation which rightly showed that BA has found out that everyone who can buys HBO anyway rather than buy up to their "cheap" luggage inclusive fare. This suggests to me that now making luggage HBO+30 instead of HBO+15 is not an elastic situation since already, only those who absolutely have to will purchase the luggage component as you point out in 1.

I think that there is a mistake in thinking that BA earns more from selling current luggage inclusive fares: I mentioned at the time that AF once showed me, several years ago, that the cost of transporting a piece of checked luggage within Europe was approximately £9. That was several years ago and suggests that the current luggage inclusive is only at "cost price" which is not good enough to make a profit. And if people already do not buy luggage inclusive when it is barely sold at unit cost, BA can't afford to sell the same for more (which may well have been their original plan) as people simply won't buy it. That's a serious conundrum.


I think that we both agree that BA was hoping that HBO would enable them to compete for the leisure market with U2 without encroaching on their regular market, and that instead, it has led to a decrease in revenue. We seem to disagree on where they take it from there. I actually think that your later answers are closer to my pessimistic view, while the other ones were perhaps hoping for a more "conservative" (I do not mean that in any derogative manner) answer ie going back to making the luggage inclusive fare more attractive to take people back to it.

My perception is more negative. I do not believe that BA have the margins (for their short haul operations) to give more, and as said, I do not think that the "old" luggage inclusive means a profit either anyway, so my guess is that instead, they are trying to ensure that they milk more out of passengers by implicitly doubling the price of including a suitcase without increasing the lowest appeal price, and explicitly removing the hand luggage only option for less price-sensitive tickets, hence squeezing an extra £20 or so at that level whilst also avoiding the dissatisfaction of people unable to select seats etc whilst paying fairly expensive tickets.

Again, I can only hope that I am wrong.

neofung

I am interested in "Free flight changes on the day of departure, up to one hour before scheduled flight time". Hope it will not be so expensive...

IAMORGAN

Yep but £10-£15 more to get status benefits compared to £150 more is quite significant. I've never used a HBO fare. I'm clearly in the minority of travellers these days that values having these things included and I used to value the unpublished benefits of BA not being operated like a LCC. Boarding BA now feels more and more LCC and for me it is becoming harder to justify retaining status or what BA's usp is on point to point European flights. A 'free' crisp and a (1) tiny can of Diet Coke isn't quite it! That's not a complaint - BA can do what they want and I'm sure there are sound commercial reasons, but I think I've probably now reached the point where I may as well fly easy jet if they are cheaper on the route I want. Until now, I wouldn't even consider a LCC if BA operated the route.

crazy8534

This change makes perfect sense with the new higher charges for exit row seats which will affect everyone now that there is no choice for even status passengers to buy the cheapest tickets with included baggage/free seat selection. Oh they knew what they were doing. Very clever really.

radui

If the current semi-flex prices stay unchanged in the new model, we may very well see situations where a restricted Club booking is actually cheaper than the "standard" checked luggage - somewhat reducing the value of the benefits you get with status.

EuropeToAsia

Thanks for looking up the numbers. ABZ probably has less competition than AMS or FRA, but BA seems to say: If you want status benefits like seat selection or luggage, pay twice the money and get a semi flex fare, or pay seat selection and baggage fee on top of the HBO fare.

But where there is a U2 alternative, I'll get luggage and seat selection for less money. Unless I need the semi flex part on Y shorthaul or need BA status for longhaul Y travel, why bother keeping BA status after this?

simonrp84

I think this is an important point. What is BA's USP? The only things I can think of are free food+drink and the ability to transfer to long haul. Bit depressing when you think about it.

crazy8534

So they are combining both benefits of seat selection and cabin bags for £10 each way. The loss appears to be the extra bags with status.

Current prices (far in the future):


Possible future prices:


So you pay £20 to keep your seat selection status benefit and you lose your extra bags in the hold whatever?

wyvern

It's the removal of 'WCB Standard' which is going to cause the most problems - apart from an effective removal of status benefits unless you buy a much more expensive ticket, these changes will see more pax buying HBO fares and therefore making the cabin baggage problem worse.

The cabin baggage problem has been an issue on any reasonably full flight I have taken.

A genuine enhancement would be following the US/Virgin Australia model more and allowing status pax seat selection and baggage allowance on fares that don't provide this.