Why is AA killing UA and CO at ORD
Nov 14, 2010, 8:29 am
#1
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Why is AA killing UA and CO at ORD
Fares on my route LAX-ORD the next several months are easily 30% lower on AA. Curious. Wonder if the FTC is watching.
Nov 14, 2010, 8:31 am
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Nov 14, 2010, 8:41 am
#3
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Nov 14, 2010, 8:46 am
#4
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CO hasn't flown LAX-ORD for at least 25 years, and you think somehow the merger is jacking prices on that route and the FTC should investigate?
Or do you think the FTC should be investigating AA for dumping?
OK, so you want a cheap UA ticket. Just fly (or at least buy) LAX-ORD-MKE if you don't like the LAX-ORD fare.
Or do you think the FTC should be investigating AA for dumping?
OK, so you want a cheap UA ticket. Just fly (or at least buy) LAX-ORD-MKE if you don't like the LAX-ORD fare.
Nov 14, 2010, 8:54 am
#5
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If UA is able to command such a healthy premium at ORD, sounds to me like the OP got it backwards. UA appears to be killing AA, assuming that UA is always substantially more expensive (but I'm guessing that it's not - the OP is probably relying on too few data points).
Nov 14, 2010, 9:01 am
#6
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Since CO doesn't really exist anymore, the fact they haven't flown direct on this route in 25 years is meaningless. I just don't like paying $130 more to fly my airline of choice. Yes, if UA manages this and sells the seats, great, fantastic for their revenue. But, I have to consider my revenue too. And since loyalty doesn't provide the rewards it used to, I may be like most kettles, and simply fly whatever is cheapest. In that environment, UA's higher price will eventually leave it with fewer filled seats. It's higher on several (more than 10) dates I've checked through January. I've used Orbitz matrix with flexible dates, so I think the data points are somewhat plentiful.
Nov 14, 2010, 9:03 am
#7
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Since CO doesn't really exist anymore, the fact they haven't flown direct on this route in 25 years is meaningless. I just don't like paying $130 more to fly my airline of choice. Yes, if UA manages this and sells the seats, great, fantastic for their revenue. But, I have to consider my revenue too. And since loyalty doesn't provide the rewards it used to, I may be like most kettles, and simply fly whatever is cheapest. In that environment, UA's higher price will eventually leave it with fewer filled seats. It's higher on several (more than 10) dates I've checked through January. I've used Orbitz matrix with flexible dates, so I think the data points are somewhat plentiful.
You're obviously just bummed that UA feels that can get more money on that route than AA. Perhaps you should switch to AA.
Nov 14, 2010, 9:38 am
#8
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Of course if they were charging the same fare, there would be allegations of price-fixing and collusion. It would seem that AA has a sale fare available, and UA has not matched -- a month from now the opposite may be true -- take advantage of the discounts while you can!
Nov 14, 2010, 9:39 am
#9
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And there you have it...........
Simply forget about your hard earned miles and loyalty and just switch to AA.
Case closed......
Simply forget about your hard earned miles and loyalty and just switch to AA.
Case closed......
Nov 14, 2010, 10:43 am
#10
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It's not just LAX-ORD and UA. How exactly did you expect airlines to make profits after coming out of the recession?
You've got it backwards: UA is filling more seats and is charging higher prices for the ones that aren't filled.
Plus, I'm pretty sure UA could fill a LOT of seats if they charged $0.01 for the flight... but they might not stay in business too long.
In that environment, UA's higher price will eventually leave it with fewer filled seats
Plus, I'm pretty sure UA could fill a LOT of seats if they charged $0.01 for the flight... but they might not stay in business too long.
Nov 14, 2010, 10:46 am
#11
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It's not just LAX-ORD and UA. How exactly did you expect airlines to make profits after coming out of the recession?
I know. But, they are the highest on the route, one they dominate.
You've got it backwards: UA is filling more seats and is charging higher prices for the ones that aren't filled.
Huh?
Plus, I'm pretty sure UA could fill a LOT of seats if they charged $0.01 for the flight... but they might not stay in business too long.
No kidding.
I know. But, they are the highest on the route, one they dominate.
You've got it backwards: UA is filling more seats and is charging higher prices for the ones that aren't filled.
Huh?
Plus, I'm pretty sure UA could fill a LOT of seats if they charged $0.01 for the flight... but they might not stay in business too long.
No kidding.
Nov 14, 2010, 11:27 am
#12
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Hi transportbiz, I think the point eponymous_coward is trying to make is this:
Say UA and AA are both flying 100 seats ORD-LAX. One of them decides to sell 20 seats at $100, 60 seats at $200, and 20 seats at $500. The other notices this pricing and decides to match it. If you were to try to buy one seat on either carrier when they first start selling tickets and nobody else has bought a ticket, you'd be able to get a seat for $100 on either carrier. Three months go by, and other people are buying tickets. UA manages to sell all 20 of their $100 tickets, and even some of their $200 tickets. AA manages to sell only 10 of their $100 tickets. At this point (three months after initial selling), if you try to buy a seat, you'll be quoted a price of $100 for AA or $200 for UA. However, UA is managing to make more money per seat, with more seats sold, than AA. At first glance, it appears that AA is "killing" UA on the price, but it could just be that UA is "killing" AA by having already sold their cheap tickets and now UA is on to the real money-makers.
Or it could just be that they've sold the same amount of tickets and AA wants to fill seats - even at a cheap price - than UA does.
Say UA and AA are both flying 100 seats ORD-LAX. One of them decides to sell 20 seats at $100, 60 seats at $200, and 20 seats at $500. The other notices this pricing and decides to match it. If you were to try to buy one seat on either carrier when they first start selling tickets and nobody else has bought a ticket, you'd be able to get a seat for $100 on either carrier. Three months go by, and other people are buying tickets. UA manages to sell all 20 of their $100 tickets, and even some of their $200 tickets. AA manages to sell only 10 of their $100 tickets. At this point (three months after initial selling), if you try to buy a seat, you'll be quoted a price of $100 for AA or $200 for UA. However, UA is managing to make more money per seat, with more seats sold, than AA. At first glance, it appears that AA is "killing" UA on the price, but it could just be that UA is "killing" AA by having already sold their cheap tickets and now UA is on to the real money-makers.
Or it could just be that they've sold the same amount of tickets and AA wants to fill seats - even at a cheap price - than UA does.
Nov 14, 2010, 11:43 am
#13
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UA has long dominated over AA at ORD. It's their largest hub and UA is Chicago's hometown airline. Plus, LAX-ORD is a hub-hub route.
Nov 14, 2010, 11:45 am
#14
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However, UA is managing to make more money per seat, with more seats sold, than AA. At first glance, it appears that AA is "killing" UA on the price, but it could just be that UA is "killing" AA by having already sold their cheap tickets and now UA is on to the real money-makers.
SunLover
Nov 14, 2010, 12:07 pm
#15
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