soitgoes

And this is one of the reasons why airlines have to be careful not to devalue their miles too much.

If they do, they risk losing the market to sell their miles or risk seeing the price they can charge for those miles decline.

indufan

This is really flawed. I have been on SkySaver award tickets where they were oversold. Almost all planes I have recently been on are sold at least 100% if not more.

Tango

NO---a system that everyone earns miles but status is based on tier points and tier points are only earned on higher fare buckets.


The real problem the US airlines face is overcapacity. If the airlines were to cut flights by 20%, all cabins would be mostly full and would become that much more difficult to redeem award seats. Only problem is fewer people would chase credit card miles and the ensuring loss of revenue would put Delta back into Chapter 11.

Flying Dutchman

Of course there are going to be instances where Delta's sales predictions prove inaccurate. The general point remains, though, that Delta intends for SkySaver seats to be those that otherwise would have flown empty. The lesson from your experience is not that award prices ought to be increased, but that Delta's sales prediction model needs a bit of work.

Ob1Stogie

Yes, I am a "customer" and not an employee. I like Delta as much as the next guy, but ultimately, I fly Delta because they offer the best deal as a "consumer". I have to fly and I chose to fly Delta. If they go under or make the product less attractive than another provider, I'll fly another company.

I just don't understand the mentality that we as frequent fliers need to "help" Delta. If Delta can't effectively manage their company, why is it incumbent on me to "give back" the perks I have already earned by using a Delta product? Why would anyone who has to fly as much as we all do, ASK to have our situation made worse just to "help" Delta?

Is anyone going to go to a GM dealership and offer to not take a rebate or ask for higher financing or pay more than sticker for a vehicle just because GM stock is down 25% in the last month and they are losing money left and right? Why are the airlines any different? I just don't get it.

If DL,AA,NW and UA stop giving out staus/miles/perks or make them worth far less or way to hard to redeem then I'll fly SW. I really don't want to fly SW.

Don

A valid point to this degree: The question is hardly about DL. I've posted it here because it fly DL more than any competitor, and Skymiles (and to a far lesser degree AAdvantange) is where my miles are. But this is absolutely an industrywide issue.
But a few thoughts here:
Capacity reductions look to be accelerating, and with no real "end point" guaranteed. (US, as most of us saw today, is grounding its 73s, axing Ted and chopping mainline by about 17 percent). That makes the old "vote with our fee" argument pretty hollow. It was a terrific argument when loads averaged 70 percent or so. They don't anymore.

Also, you'll notice there's no "Please devalue Skymiles" petition posted here. I'm hardly suggesting that FTers are going to be eager to see this change (just look over the last few days' comments to verify that. )
But, becoming aware that the system is broke and unsustainable is merely being informed. Personally, I'm going to look to use - rather than build - miles over the next couple of years precisely because I don't believe that the legacies can continue on this way.

When the red ink continues quarter after quarter and the following year projections all look worse, management would be suicidal if it didn't ramp up the level of painful change - the employees have gotten whacked, so many amenities are history, fundamentally basic levels of customer service are toast, fares are up, stockholders are bloodied ... well, those FF programs - especially those that encourage cherry-pickers and us cockroaches - start looking mighty fat and generous.

Should we ask to give things back? Well, I'll still collect miles via Amex from Home Depot, etc. etc., and continue watching for the rarer and rarer double-miles promos. But I won't be shocked to see this house of cards on the carpet, either.
(And on a micro level, by the way, I've long since learned that the "last possible dollar" method of business sounds great but delivers little. With contractors at home, I try to be sure their quotes include a reasonable profit - if not, I'm in for hidden costs or shoddy work. For our annual Mardi Gras party, I in fact talk with the chef at length about making sure he takes care of himself in the price quote - because I want him around next year).

Klm is Dead - Long Live KLM

You mean you strive for win-win situations and long-term, workable relationships in your business dealings instead of just thinking about yourself, extracting blood and seeing how bad you can screw the other guy? Can you imagine what a mess the country would be in if everyone was that fair, mature and rational?

Don

Oh, KLM, it's to hard during these euphoric, Roaring '20s, riding-high days of Bush-Cheney to even IMAGINE our country being in a mess. Why, 2008 is morning in America, right? Ahhhmmm ... right?

chuckd

Is it really necessary to bold, italicize, enlarge, and make your posts green?

Don

Quote:

Originally Posted by chuckd

Is it really necessary to bold, italicize, enlarge, and make your posts green?

Yes.

Meanwhile, from AP this morning:

DALLAS - Continental Airlines Inc. said Thursday it is cutting 3,000 jobs and reducing capacity in the fourth quarter by 11 percent, citing record fuel costs that have pushed the airline industry into a "crisis."

Actual September-to-September mainline will take a 17 percent reduction.

Earlier this week, GM's CEO said he's dumping SUV production into the ocean - and significantly, he emphasized that America's fuel fiasco is structural, not cyclical.
And that, folks, may end up changing commercial aviation more than 9/11 did.

soitgoes

And you don't think the skyrocketing price of oil has anything to do with the reaction to 9/11?

starflyer

So if I'm losing $X on the average passenger, and say $2X on an empty seat, why would I want fewer passengers instead of more?

chemist661

Airlines (including DL) make plenty of $$ from credit card companies & other partners. A domestic award only costs the airline approx $10. (check out the 10K filings with the SEC for current info). Maybe more now since fuel is higher.

I only have 28K DL miles left. I will attempt to get a domestic saver award (good luck! ) and magazines for the excess.

soitgoes

Are you familiar with the concept of marginal cost?
If you get rid of the 'average pax', you'd have to charge even more to the full fare pax...

Also, don't forget that the loyalty crowd pumps hundreds of millions of dollars into every major airline through partner spending/activity.

flyingfran

I readily admit that I do not understand the details of the airline industry. I am not sure anyone on this forum does either, but certainly many are more informed that am I. However, if I am to accept the premise that ff programs have to be altered to provide financial protection for DL, the very first thing I have to know is to what degree award seats are preventing DL from collecting money on paid seats. I have now asked this question three times. On any given flight, does anyone have any idea how many award seats there are? What is the degree of "loss" DL experiences on the average flight?

If the seat is empty it does not represent a loss to DL. I have not been on a flight that was totally full for quite some time now. By the same token, I have not been able to redeem my miles for an award seat between now and next March regardless of what destination I am seeking.

It is difficult for me to believe that DL is loosing lots of money with their ff program, when it is virtually impossible for me to get an award seat, and I have no evidence that it is any easier for anyone else. Does DL have to reveal how many award seats they allocate per flight? Without that information I think everything else is just so much speculation.