You are absolutely right in that there is a group willing to pay premium fares to fly a Quality airline. My question is: Is that group big enough to keep the airline afloat? Does that group bring in enough cash that you can afford to allienate the masses that are not willing to pay that amount?

Bottom line in the airline industry today is that more and more passengers are choosing to fly the LCC, add on that fuel prices are soaring and the Legacy carriers are suffering by trying to compete with the LCC. I think the legacy's have to make a decision, either to be a full service airline and charge more or become a LCC and compete with them price wise. It is very difficult to try and do both.

I'll admit it, I don't like CO because of their awful coach product and their really awful international upgrade policies.

That being said, I think that anyone who consistently flies on less than full-fare tickets is crazy to let their FF program jerk them around like this. ;)

i know we're all just pi$$ing in the wind until DL makes their announcments and CO announces skyteam, but here is a response to a letter i wrote recently. it follows the canned response "we appreciate your concerns and will forward your letter to managment" that was sent to me the week before.

the response:

Dear Mr. Leonard:

Thank you for your follow-up regarding our OnePass program for 2005. At this time the 100% Elite Qualification Miles and Points promotion at continental.com is scheduled to end on December 31, 2004. Any decision to extend or revise this promotion will be publicly made available at continental.com. However, I understand your concerns and have registered them for review during future planning sessions.

Mr. Leonard, we certainly recognize that you do have alternatives in your choice of carriers; however, we trust that an honest review of the overall excellent service that you have received from [us] will encourage you to remain in the Continental family. I hope we can continue to welcome you aboard.

C. C. Rydlund
Alliance Customer Care Manager

my letter, should you care to bore yourself:

I realize you have received many correspondences regarding 2004's policy of awarding 50% miles and no segment points for fare classes Q, I, S, W, T, X and L. Although I am absolutely disguted by the change, you did allow us to receive full credit by purchasing on co.com and I do appreciate that gesture.
As I have heard no word of the "purchase at co.com for full credit" promotion being extended for 2005, i have planned no travel on Continental for 2005, rather, I am planning on switching to AA or NW. I know many others who are doing the same because we have not heard an announcment from Continental or Onepass.
I do have two suggestions that may keep myself and others aboard Continental aircraft. 1) Revert back to the elite qualifying requirements for 2003 or, 2) at least, offer .5 segments (rather than zero) for Q, I, S, W, T, X and L fares.
For 2004, Continental reduced the elite qualifying miles on Q, I, S, W, T, X and L fares by 50% yet reduced the elite qualiying points by 100%. By reducing miles and points by 50%, it would be fair to those who attain elite status with miles as well as for those (me) who attain it with segment points. For many of us who live within 500 miles of IAH, EWR or CLE, segments are the only way we qualify for elite status and continue to fly Continental.
Should you check my flying record for 2004, you will see that I fly CO for business and pleasure and that my purchased fares range from D to L.
I do not expect to be given the world because I fly 10 $200 transcons a year, but i do expect more than "no elite status" in 2006 becuase I was awarded zero points for 1/2 of my paid trips with Continental.
Thank you for your time.

Yeah, I'd be really interested to see how long SQ would last flying a few NYC-Florida nonstops, transcons in the USA, flights to/from MCO, and all the tiny airports that CO and its partners serve every day all week long. Passengers may pay more to fly on SQ, but that's because they're all on international flights that are likely in excess of four hours on jumbo jets, or because they're the only airline that offers nonstop service from LA and NYC to SIN. We don't have the demand for a SQ-like product, at least in the US domestic market. Besides, you can't even compare SQ to CO, because the former is far superior in quality to the latter---that's why you'll never hear me complaining about the price of a SQ ticket.

I still contend over 90% of airline passengers dont know nothing regarding the ticketing fare basis and A, B, C, D etc fares other than (1) coach or (2) first class.

MisterNice

Exactly
 

I couldn't agree more! The general flying public doesn't care about who they fly as long as they are "safe", get there ontime, and they get the lowest fare. Even to that effect most people will nit pick over say a ten dollar fare difference. One time I went with a bunch of friends to MCO, and Continental was 10 dollars more than US Airways ... (from EWR) take a guess who we flew... Wasn't earning valuable OnePass miles on that flight ...

This is why I feel it would be prudent to instead of giving everyone 100& EQM on deep discount coach fares (or rather not giving it out out at all), it should only be given to existing Elite members, sort of an appreciation for thier business. Thus making it a lil more difficult to obtain Elite status and preventing the ocasion flyer (who say flew to EWR-MNL and back, and then one more round trip to just hit 25k only one a year) from obtaining elite, but helping to ensure that current Elite member's are penalized for flying an ocassional low fare... I know I USUALLY fly U class or higher, but hey sometimes even I can't pass up a sale fare (like the x fares transcon for fall).


-Vincent

Methinks you mean not penalized?

So here's a question for the group. Many of CO's most profitable routes are the mainline international routes. (I'm not counting the ERJ flights to Mexico.) From what I understand, LGW, TLV, NRT, HKG and a few others are the most profitable routes in the system.

That said, what percentage of the domestic traffic is passengers being fed to the more profitable international routes? If CO (hypothetically) were to cease money losing domestic operations in favor of being simply a long haul airline, how much of their international market share would they lose by not having the feeder system?

While people don't necessarily want to have to change planes on a domestic itinerary, it's not hard to convince people from smaller markets to change planes once on the way to Europe/Asia/South America. Meanwhile, the international routes are the place where the LCCs have not yet been able to make serious headway. (Did any other than PeopleExpress or Tower make a serious effort?)

For me, despite difficulties getting upgrades domestically, I'm sticking with CO for the forseeable future. I make 1-3 trips a year to TLV, and I'm not a big fan of LY's service and prefer to make the trip nonstop from NYC. That leaves CO as my only real choice. That said, there are rarely anything less than H fares available on the EWR-TLV flights during the times of year when I can fly. (With a third trip on tap for this year, I'm on my way to Gold for the first time, not that I'm sure I'll fly too much next year.)
-JMP

Just to add my 2 cents regarding qualifying for 2006 elite status during 2005.

In the past, I had "budgeted" about $3,000 to get to Platinum Status. If you worked at it, this was an acheivable target. With the new EQM rules, I figure you need to spend less that $4,500 to get to Platinum. Once again, you need to work on it. For instance, you can buy a NW "B" ticket JFK-SHA via NRT for about $1,500. This fare gives you the same 150% bonus as CO's "H" fares and this means about 24,000 EQMs with the bonus. So three of these will just about do the trick. An earlier post indicated that an "H" RT on CO from EWR-GIG would be about $1,200. SOme combinations of domestic trips and one or two international trips in CO H or NW B would do the trick. So, it appears that we will need to spend more money to get to Plat, but it is possible, and it just requires some work. But isn't that what Flyertalk is for?:)

The question is, when we get to Plat, what will be there, with CO dropping the 753s to 12 FC seats and the 735s to 6.

Well CO gives you ZERO E+ seats... :D

Usually on U class or higher
 

Well like I said before .. I usually fly fare class U or higher, which gives me 100% EQM no matter what booking channel (95% of the time continental.com) I just think that with the reality of EQM here to stay, they should grandfather Elites to earn 100% EQM no matter what fare class purchased in order to show the appreciation for us customers... I just became silver recently again after some time of no elite status, and if my falying patterns had been for the whole year (I only started flying much again since july) I for sure be at gold (still trying for by the end of year, my planned travel through the rest of the year will put me at 43k) :D

Anyways .. I'm at "work" might wanna do some of that ...


-Vincent

I would argue that the market has actually split two ways- a very small group that used to pay premium First fares has now defected to private jets, and a larger cost-conscious group has switched to using LCCs. It seems like CO has probably lost a small but significant market for the high priced walk up First fares to groups like Net Jets and similiar, and that's unlikely to change in the near future. Maybe private planes aren't nearly as popular around the rest of the country as they are in the north east, but they seem fairly popular for last minute short to midrange hops around there.

Anyway, I'm 400 miles short of Silver right now, so after I cross that, I'm very tempted to switch my 2004 transcons to United, or AA (which even offers the Alaska SEA-EWR nonstop- nice since 90% of my CO flying is SEA-EWR nonstop).

I would never consider CO to be even near the same level as SQ or CX...they are worlds apart. Just look at the premium economy cabin SQ rolled out at prices very competitive to CO and its partners who still offer 17"x31" seats in coach. There is a small group willing to pay a premium to fly a quality airline, but CO is certainly not a quality airline in that league...it is a plain hub and spoke carrier with nothing significant enough to differentiate its domestic product from any of the other hub and spoke carriers to command a price premium. People fly CO because they can pay a coach fare and upgrade to first with status, and outside of EQM, shrinking FC cabins and scary International/Hawaii upgrade policies, OnePass is pretty darn good. If that benefit didn't exist, who would choose to fly CO outside of those living around EWR, IAH or CLE, or when CO had the lowest price?

Granted, CO is more comfortable and offers better service than Southwest, ATA, USA3000 and carriers like those, but the service and quality gap between LCCs like jetBlue and the network carriers is narrowing. jetBlue is beginning international service to nearby countries - what happens when they roll out discounted trans-atlantic service on A330s with wide, comfy leather seats and on-demand entertainment? Who would choose a CO 757 in coach to LGW then?

Developing a marketing plan that rewards a very small number of premium customers while driving away the bulk of your loyal lower-mixed fare customers is just not a sustainable model, in my opinion. I think alot of CO's decisions are driven by a mix of customer resentment, an unrealistic picture of their product's market placement and pure speculation rather than common sense or hard numbers. For CO to think that the bulk of its non-contracted business customers will pay up to retain their status in direct conflict with their employers' policies is just nuts...not to mention their most frequent corporate customers already get discounts that drive mid-priced 100% EQM fares down to the deep discount levels anyway - so where will all this extra revenue come from?

Very well said! ^

If DL can secure the $1,000, 000,000.00 in savings they requested from labor. The LCC's will be history. Sadly the issue is labor. If you want to pay pilots $100-200+K ticket prices have to go up.