HON "enhancements" getting closer [HON bonus reduced from 50% to 25%] [merged]
Sep 7, 2007, 9:35 am
#136
FlyerTalk Evangelist
Join Date: Jun 2005
Location: Point Place, Wisconsin
Programs: LH HON, BA Gold, EK Gold
Posts: 14,505
Nope. We are not talking milage runs here - put your company hat on:
Taxes is no money that LH can pocket and if out of a 400 EUR fare 100 EUR are taxes (a mere 25%) - than LH has only 300 EUR for expenses and profit.
On the 4.000 EUR ticket you have the same 100 EUR - LH can pocket 3.900 EUR. Margin is significantly higher.
And then you can look what happens to the margin:
Short-haul, every HON is eating up another 50 EUR, leaves 250 EUR. The long-haul is eating up 50 EUR as well and leaves 3.850 EUR.
For a customer 10 short-hauls equal 1 long-haul (4.000 EUR).
For LH the situation is completely different: 2.500 EUR to 3.850 EUR.
Talking revenue - and that is all LH cares about (Alles fuer diesen Moment) - then you have to deduct taxes and when you take your company hat off again you can pray that minimum milage will not be changed...
Taxes is no money that LH can pocket and if out of a 400 EUR fare 100 EUR are taxes (a mere 25%) - than LH has only 300 EUR for expenses and profit.
On the 4.000 EUR ticket you have the same 100 EUR - LH can pocket 3.900 EUR. Margin is significantly higher.
And then you can look what happens to the margin:
Short-haul, every HON is eating up another 50 EUR, leaves 250 EUR. The long-haul is eating up 50 EUR as well and leaves 3.850 EUR.
For a customer 10 short-hauls equal 1 long-haul (4.000 EUR).
For LH the situation is completely different: 2.500 EUR to 3.850 EUR.
Talking revenue - and that is all LH cares about (Alles fuer diesen Moment) - then you have to deduct taxes and when you take your company hat off again you can pray that minimum milage will not be changed...
Your definition of margin is revolutionary !
Sep 7, 2007, 9:43 am
#137
Join Date: Nov 2004
Location: US
Programs: LH and BA
Posts: 2,324
Yeah, I like this game... My company has 300K+ employees and spends $$$ on LH. :-) We are getting substantial discounts for fully flexible tickets in C - however, as mentioned, we are getting money back at the end of the year, so that the actual ticket price is not a good basis for comparison...
If the person get's HON in the meantime great, if not the person will try to fly F in any case.
So again what is the benefit of HON? ...
The FCT, and more importantly, the availability of C award tickets when needed.
Sep 7, 2007, 12:28 pm
#138
Moderator, Hilton Honors
Join Date: Nov 2003
Location: on a short leash
Programs: some
Posts: 71,422
Sep 7, 2007, 3:11 pm
#139
Join Date: Apr 2004
Posts: 1,201
After all I hate to share the S Class with two other snobs every time I arrive in MUC from ZRH. What's exclusive about that?
Must be all those ex SWISS Circle members.....Whining, complaining HON, ain't I?
Normally I prefer to take the real bus instead. But what's 750K HON miles for having your limo all to yourself again? Especially now as SQ PPS is not part of the yearly status routine anymore? A piece of cake to every real FF....
Sep 7, 2007, 11:23 pm
#140
Join Date: Aug 2004
Location: OSL/IAH/ZRH (time, not preference)
Programs: UA1K, LH GM, AA EXP->GM
Posts: 38,265
) but as we are not LH but their customers, we should probably discuss what such a move means to us. Of course it's nice now and then to gain some insight how an airline works. The arbitrage is normally achieved by exploiting shortage on the airline side and price shopping on the pax side .... or then exploiting weaknesses if one is stuck as a frequent traveler. And FT is more about the latter than about the airline industry in general.
How much LH wants to get out out of their pax for a certain elite level is of as little interest to me as it is for them how we procure the funds.
So if LH raises the bar for their worthless SEN status one bit, it just makes it easier for me to escape their sway. I will still empty their lounges, take 45 minute showers, bring 92 kg of luggage on a W class ticket, and use their sluggish F check-in. I just will spend even less money on them than I do now. Even though that is admittedly not too easy as I mainly feed UA, TG, OZ, LX, and QF these days.
Sep 8, 2007, 12:56 am
#141
Join Date: Jan 2005
Location: A Sight For Roll Eyes
Programs: :enrolleyes:+, :drôleyes:
Posts: 5,461
Indeed, a beautiful remark/reminder by totti!
Yep. And since Threy's disappearance (taking along with him his thorough knowledge of the airline industry), we've been witnessing every now and then various coarse attempts by several famuli of the airline industry to analyze LH's incentives (as if everyone else here is stupid and can't see the revenue vs mileage argument) that unfortunately are not even half as insightful as Threy's...
Signature weero post!^
Still, I don't think anyone will love me for loving it...
Originally Posted by weero
And FT is more about the latter than about the airline industry in general.
Originally Posted by weero
How much LH wants to get out out of their pax for a certain elite level is of as little interest to me as it is for them how we procure the funds.
So if LH raises the bar for their worthless SEN status one bit, it just makes it easier for me to escape their sway. I will still empty their lounges, take 45 minute showers, bring 92 kg of luggage on a W class ticket, and use their sluggish F check-in. I just will spend even less money on them than I do now. Even though that is admittedly not too easy as I mainly feed UA, TG, OZ, LX, and QF these days.
So if LH raises the bar for their worthless SEN status one bit, it just makes it easier for me to escape their sway. I will still empty their lounges, take 45 minute showers, bring 92 kg of luggage on a W class ticket, and use their sluggish F check-in. I just will spend even less money on them than I do now. Even though that is admittedly not too easy as I mainly feed UA, TG, OZ, LX, and QF these days.
Signature weero post!^ Still, I don't think anyone will love me for loving it...
Last edited by andre1970; Sep 8, 2007 at 12:14 pm Reason: edited by moderator request
Sep 8, 2007, 1:46 am
#142
Moderator: Asiana & Qantas Frequent Flyer
Join Date: Dec 2006
Location: STR/SYD/SMF
Programs: QF Lifetime SG, LH HON, OZ Lifetime Diamond +, HH Diamond, Marriott Lifetime Platinum
Posts: 14,375
Sep 8, 2007, 2:00 am
#143
Join Date: Aug 2004
Location: OSL/IAH/ZRH (time, not preference)
Programs: UA1K, LH GM, AA EXP->GM
Posts: 38,265
I do ... even though I can see that this doesn't count all that much .
And I have to admit that TFM's approach for the one-year subscription for lounge and airport use is even much better. And so much more sophisticated
.
.And I have to admit that TFM's approach for the one-year subscription for lounge and airport use is even much better. And so much more sophisticated
.
Sep 8, 2007, 7:43 am
#144
Join Date: Sep 2005
Location: BRU
Programs: LH SEN, SN Gold, Eurostar Carte Blanche, BA, QF, AF
Posts: 6,856
And LH doesn't fly this route.
SmilingBoy.
Sep 8, 2007, 11:34 am
#145
Join Date: Jan 2005
Location: A Sight For Roll Eyes
Programs: :enrolleyes:+, :drôleyes:
Posts: 5,461
Sep 8, 2007, 11:41 am
#146
FlyerTalk Evangelist
Join Date: Oct 2004
Location: MUC/LAX/SMV
Programs: LH, UA, BD, AA, NW, FB, NH, AC, Sixt, Hertz, Avis, *W, HH, Marriott, PC, Leaders Club, AMEX
Posts: 12,406
Sep 10, 2007, 12:04 am
#147
Join Date: Aug 2004
Location: OSL/IAH/ZRH (time, not preference)
Programs: UA1K, LH GM, AA EXP->GM
Posts: 38,265
Sep 10, 2007, 1:11 am
#150
FlyerTalk Evangelist
Join Date: Oct 2004
Location: MUC/LAX/SMV
Programs: LH, UA, BD, AA, NW, FB, NH, AC, Sixt, Hertz, Avis, *W, HH, Marriott, PC, Leaders Club, AMEX
Posts: 12,406