jacobsleather

Yes! A very sloppy writing style, not at all consistent with formal messaging usually seen from CX.

leungy18

Where I can see which routes are involved in this upgrade bid trial?

sxc

https://upgrade.cathaypacific.com/offer/CathayPacific

sscywong

I'd say it is to minimize op-up... Guess CX still wants to minimize the possible fare cannabalisation effect by rejecting:

Type 1: In case op-up is needed, those with maximum aggregate fare up to the point that no further op-up needed

Type 2: In case no op-up needed, any aggregate fare (original fare + upgrade bid and factoring membership tier into consideration) that doesn't meet their minimum threshold

That's what I understand from the T&C stating that original fare class and membership tier will be factors affecting the bid success

Please read FAQ. One class only. You are offered Y to J in ex-ICN flight because there's no PEY onboard

Cathay Dragon 666

The biggest turn-off is the upgraded ticket still earns the same club points and miles as the original purchased fare. Why not work out a formula that depends on the distance and fares give additional points and miles?

percysmith

"original fare + upgrade bid"
Tricky one to manage - if the aggregate is equivalent to straight revenue fare then this upgrade bid might as well not exist. If the aggregate is significantly lower then it will affect passenger behaviour (passengers buy cheaper (PE) ticket then expect to upgrade)

sscywong

Because CX thinks after you upgrade by miles you still get the miles and CPs of the original fare. Now they just offer you an alternative by cash instead of miles so earning ratio should remains as that upgrade using miles

I think this goes down to the difference between ex-HKG fare v.s. other ex-XXX fares. If (a big IF) the system is well designed, a more expensive ex-HKG E fare should have higher weighting than an ex-XXX transit via HKG fare.

Me think the "aggregate" I mentioned would be something like "ex-HKG E fare + upgrade bid = ex-XXX I fare".

But of course that depends on whether CX can get it right this time...

btschang

Talked to a friend at CX and he explained to me that they have been trying to limit the impact to op-ups. It seems that the specific routes selected for bid are typically light loaded. So even with or without bidding, there won’t be any op-ups in the first place. For those flights where the loading is really high (beyond whatever threshold), it probably won't even open up for bidding. And if you refer to the email again, it says ‘special upgrades’ will be protected, so it is most likely sitting somewhere before op-ups from overbooking in the processing timeline (the one sscywong mentioned):

redemption till T - 7 days
-> Upgrade bid till T - 50 hours
-> 2 hours processing before T - 48 hours OLCI opens
-> Instant upgrade by miles / a-card upgrade opens, op-up assessment as usual

Cathay Dragon 666

While I do see the logic in this, and realized to accounting miles = cash. However, there is still a huge difference in reality, miles redeemed doesn't earn them extra revenue, cash upgrade does. They want to discouraged people with mileage redemption, but encourage people to hand them more cash.

QRC3288

Actually, to nit pick here but it matters....mileage redeemed ARE translated into accounting revenue which falls to earnings. Although you are correct it's not (consolidated) cash flow, but generally mgmt incentives are tied to earnings not cash flow. And earnings is an accounting concept, and it indeed gets larger with mileage bookings.

They also care about public print things like yields. I am not sure where mileage yields vs cash upgrade yields will fall but overall neither is very high yielding IMO.

Cathay Dragon 666

Again this all matters accounting-wise, but points and miles, to put it in layman's terms, are the airlines printing money themselves, give it out, and flyers can redeem them back. It is earnings that airlines offer themselves out of their pocket as IOU, which after redemption of these IOUs in reality doesn't really earn them anything (a good accounting system actually will and should reflect that).

Cash intake on the other hand is 100% pure solid revenue. Again, a good and solid accounting system should let the management realize this when they see the big picture.

ashsong

I thought miles actually earn the airlines a lot of money.

QRC3288

Yes, they do. Cathay Dragon is overlooking the fact that the majority of miles are sold for cash by CX (via CPLP).

There are a few other nuances but the bottom line is mileage bookings are real earnings, and they usually have cash flow associated with them....albeit the timing is more mismatched than cash purchases.

littlevoices

Not sure if we are going for data points, but thought I'd share my experience:
I have a cheap work trip to BKK this week (Economy S class ticket). CX is looking for a minimum of 2000HKD + 70HKD taxes per leg for an upgrade, which seems excessive considering that you can likely buy a return for less than the combined 6000HKD that would cost me for the two flights. I won't be upgrading.

This flight would have me tagged as an BA Emerald so they should know I don't really need the lounge.

However, I was interested to notice that even though the flight includes other airline legs (I fly on to Laos with TG a few days later) it still seemed to work.

sxc

Data points are great!

But yes....$6000 is about what they're charging for a BKK return these days.