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The Economics of MRs. Do they make sense?

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Old Apr 30, 2009, 4:01 am
  #1  
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The Economics of MRs. Do they make sense?

This is only my second post on FT. I'm brand new and I don't quite understand everything and would love to hear your feedback on my thoughts/questions. I've been thinking about MRs and whether they are worth it or not. I'm not an economist, but am well educated w/ a PhD in engineering and I find economical questions intriguing.

I'm hoping for a discussion on one of three things:

1) If you're an economist, can you please explain your view on this? Personally, I think the TIME used in doing mileage runs appears to be the factor that makes it a poor choice. Do people not value their time as much as they should?

2) If you have any good examples of a mileage run that totally makes sense (double/triple miles, other promotions, etc). Please don't say you "love to fly" because that means you have a different utility than most of us. I don't mind flying to go from place to place, but I don't fly for the fun of it.

3) I've considered my first ever one, but came to the conclusion that it's not worth it. Any suggestions? I'm a UA mileage plus member, and I'm at 1P status, but have never made 1K. I don't get the opportunity to do a lot of domestic routes because I moved from the US to Australia 7 years ago. There is a promotion now for double EQ miles, and if I booked a roundtrip to the US, with my upcoming trip in Sept and my previous EQ miles already, I'd make 1K. Thing is, I just got back from the US 2 weeks ago, and I'm going again in Sept. I would have to go in the first two weeks of June due to work committments and the promotion expiring June 15. The fares are around US $950 or so, which is a great deal, no doubt! Thing is, I couldn't go for long (maybe 3 to 5 days), and the travel time is 24 hours to NYC, plus all the uncomfortableness involved. The benefit would be approx 41,000 miles as well as 41,000 EQMs, which would later bring me to 1K. That comes with 6 SWUs to upgrade longhaul segments.

So, to do the math: in total, it's US $950, plus 40 hours of flying and 8 hours of layovers, and I'd have to use vacation days I don't want to use. The benefit: 41,000 miles and 1K status giving me 6 SWUs as well as other 1K benefits above 1P (but I likely won't get to use them as I fly distance, not many shorter segments).

The 6 SWUs, in a way, become FOUR because I have to sit in economy on the two longhaul segments just to get 6 SWUs. This is from the point of view that the SWUs save me from being in economy. Yes, I still get 6, but at the cost of having 2 more economy segments.

The 41,000 miles are nothing to ignore. The 6 SWUs are nice, but from my point of view, the 2 days of traveling, and the money, and the loss of vacation days when I don't really want to visit at that time...... that all adds up to be more of a cost than the sum of the benefits. The big thing is the TIME. That is valuable to me and that makes the MR not worth it. Do people not properly value their time?? Some people seem to fly into an airport, then fly out again a few hours later. That seems crazy to me. Please help me understand this

Another way to think about it is that the 41,000 miles offsets the $950 (it doesn't, but let's just say it does). That leaves the 6 SWUs versus the time and uncomfortable effort for 40 hours of flying and 8 hours of layovers. I still don't think it's worth it. Maybe if it was to take a spouse in business class to Tahiti or some fancy trip. Otherwise, those two days of effort seem to be a LOT. I don't put the same value on business class seats that the airlines put on it. They charge insane amounts aimed at willing businesses and the very rich and such. From a personal point of view, $4K or $5 return from US to Australia is not worth it.

I could see going an MR somewhere to visit a lifelong friend for a few hours. I just don't understand people's priorities to not having any sort of reason to go to city X, and leaving shortly after arriving.

Here's another idea of sorts, and this isn't intended to be offensive to Americans (after all, I am one too): Since coming to Australia, I've learned a lot about life and taking it easy and what is important. In the US, there is a much stronger consumer culture, and I think FF miles and status may get caught up in this.

I went to a lecture last night by a Nobel Laureate economist who talked about the financial crisis. He kept mentioning "maximizing one's expected utliity". So, I'm asking all you MRs: are you maximizing your expected utility?

I'm not judging you. I'm just trying to see why you do the MRs that you do.

One good example of a "good" MR is to get to a higher elite status right before the end of the year. I realize this, but I only think it's worth it if it is a short trip and a person is a few thousand miles or so short of the next elite level.

Last edited by briank1973; Apr 30, 2009 at 4:16 am Reason: wanted to add a bit more explanation
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Old Apr 30, 2009, 5:02 am
  #2  
 
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I think everyone who does MR's will have their own reasons.

Your point about the value of your time is of course valid but one of the things I do on MR's (I tend to do short haul J-up fares) is catch up reading the magazines I buy and never read.

As someone who is "always" on the phone for business I find the ability to have a couple of hours of time to myself to be worth the effort and time. Thankfully most people understand that if you are on a plane you cannot be contacted (for now!).

Also of course the status MR's give you often means you can check in later and get off the plane faster which also saves you some time (granted only a small amount).

Oh and the fact I work a 7 day fortnight means I can do runs without taking vacation days.

TE
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Old Apr 30, 2009, 6:13 am
  #3  
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Thanks

That's a good reason, TheEngineer. One that I would not have thought of. I realize everyone's situation's are indeed different. Thanks for addressing the time issue as well.
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Old Apr 30, 2009, 6:40 am
  #4  
 
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FWIW, I rarely do "pure MRs", but often do mini-vacations such as Moscow for Russian Orthodox Easter weekend. Or Rome over Memorial Day weekend. I wouldn't go on an ordinary fare, but with the good airfare deals and the DEQM on UA, I feel that I come out ahead in miles and life experiences.

But OPs point is valid. If I compare my time on an hourly rate with the hours I spend on a pure MR, I'd be ahead to just pay the F fare. Then there are the hours I spend here reading FT, trying to decipher some of the encoded postings. If I deducted the cost of those hours from the value of status and miles...let's not go there!

And there is the hobby aspect of FT and MRing, as well as the community of it all. I met two FTers this week while MRing KOA-SFO-YVR (3X). Priceless! :-)
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Old Apr 30, 2009, 6:41 am
  #5  
 
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Truly True. Everyone has their own reasons. The more you might use the benefits, the more it makes sense to do an MR if you might miss the mark.
I will MR to maintain my premier status on United, but would not go any further because I don't fly enough long haul on United to make the SWU's worth the stretch strictly due to my location in NYC.
On the other hand, I do fly enough to make my minimal status worth if for E+, group 1, discounts on E500's if I think I can clear etc....
This question has no definite answer IMHO>>>>>>
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Old Apr 30, 2009, 6:49 am
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1) If you're an economist, can you please explain your view on this? Personally, I think the TIME used in doing mileage runs appears to be the factor that makes it a poor choice. Do people not value their time as much as they should?
I think you're forgetting that most (all?) of us who do MR's rather enjoy the time spent aloft, so it's no different than pursuing other things that we enoy doing.
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Old Apr 30, 2009, 6:50 am
  #7  
 
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Originally Posted by briank1973

2) Please don't say you "love to fly" because that means you have a different utility than most of us. I don't mind flying to go from place to place, but I don't fly for the fun of it.
Who are these people you refer to as 'most of us'? In my experience, a HUGE number of FTers love to fly! I've even met road warriors who always fly for work and still love it. And I for one don't want to be part of a mainstream definition of 'most people' anyway....

And I'm confused by the difference of flying 'from place to place' and for 'the fun of it'. I've never heard of a commercial flight yet that departs and arrives at the same location. And if it did, you can well bet that no one would fly it just for 'the fun of it', because it would earn 0 miles!

Anyway, welcome to FT.
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Old Apr 30, 2009, 6:56 am
  #8  
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Originally Posted by TheEngineer
Your point about the value of your time is of course valid but one of the things I do on MR's (I tend to do short haul J-up fares) is catch up reading the magazines I buy and never read.
^^^

I'm 3-6 months backlogged on magazines since I haven't flown in a while. An upcoming mileage run to DEL should knock out a portion of that.

Mike
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Old Apr 30, 2009, 7:13 am
  #9  
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Originally Posted by hobo13
Who are these people you refer to as 'most of us'? In my experience, a HUGE number of FTers love to fly! I've even met road warriors who always fly for work and still love it. And I for one don't want to be part of a mainstream definition of 'most people' anyway....
I'm part of that "road warriors who love to fly" organization.

Originally Posted by hobo13
And I'm confused by the difference of flying 'from place to place' and for 'the fun of it'. I've never heard of a commercial flight yet that departs and arrives at the same location. And if it did, you can well bet that no one would fly it just for 'the fun of it', because it would earn 0 miles!

Anyway, welcome to FT.
At the Continental event in February (CO DO IV), they had a flight that went IAH-IAH (with an planned missed approach to HOU, and views along the coast, etc). And we earned 1,000 miles (elite and redemption miles) ^

Anyway, back on topic: As long as I don't have to take a vacation day from work, I don't consider my time when I calculate the cost of a MR. Sure, there will be some cost for my time, but I consider it negligible... just like I do my parking incurred at the airport while I'm gone and the gas it takes me to get to the airport. I figure all of my meals, drinks, hot water, etc are free while I'm on the MR, so they offset a lot of the odd costs not included in the airfare.
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Old Apr 30, 2009, 7:19 am
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Originally Posted by hobo13
I've never heard of a commercial flight yet that departs and arrives at the same location. And if it did, you can well bet that no one would fly it just for 'the fun of it', because it would earn 0 miles!
Well, actually, I did a commercial flight from IAD to IAD in March. And it was tremendous fun. And the same company does similar flights to and from other airports.

www.gozerog.com

But I realize that isn't exactly what you had in mind. And I did, alas, not earn any miles for it.
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Old Apr 30, 2009, 7:20 am
  #11  
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Originally Posted by hobo13
Who are these people you refer to as 'most of us'? In my experience, a HUGE number of FTers love to fly! I've even met road warriors who always fly for work and still love it. And I for one don't want to be part of a mainstream definition of 'most people' anyway....

And I'm confused by the difference of flying 'from place to place' and for 'the fun of it'. I've never heard of a commercial flight yet that departs and arrives at the same location. And if it did, you can well bet that no one would fly it just for 'the fun of it', because it would earn 0 miles!

Anyway, welcome to FT.
Do you really love to purely "fly"? I mean, it's great to go to someplace new. But the pure flying part, do you love that? Meaning, if you did, you would want to take off and land in the exact same place just to enjoy the fun of being in the air.

I never said there was a commercial flight that flew to the same place it takes off from. It was hypothetical. I was simply trying to separate the notion of loving to be airborne from traveling from place to place. I don't "enjoy" being in the air, but I enjoy where I'm traveling to and being somewhere else.

So by what you said, I love to fly, but NOT the act of flying, but instead the net result. I imagine most of us agree with that. I mean, it's not that great to sit in a big noisy metal container and not being able to get fresh outside air, having to use a small dirty toilet, etc. etc.

I find it very interesting that people like being on a plane just so they cannot be contacted and can relax and read. I think that says a lot about how busy things can get in today's society.
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Old Apr 30, 2009, 7:21 am
  #12  
 
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Originally Posted by briank1973
Here's another idea of sorts, and this isn't intended to be offensive to Americans (after all, I am one too): Since coming to Australia, I've learned a lot about life and taking it easy and what is important. In the US, there is a much stronger consumer culture, and I think FF miles and status may get caught up in this.
Having heard this accusation personally, I think this component is definately a part of it. Maybe having lived in a few other countries during my life and being a 1st generation American (where my family questions even non-MR travel of my job-required "light" travel of ~50K BIS miles/year), I am beginning to agree with them. Cheers for broaching this topic, btw.
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Old Apr 30, 2009, 7:26 am
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Originally Posted by briank1973

I could see going an MR somewhere to visit a lifelong friend for a few hours. I just don't understand people's priorities to not having any sort of reason to go to city X, and leaving shortly after arriving.
Note that this seems just as crazy to most people as the pure MR does. I remember some years ago flying from LAX to ORD to go to a party and getting all sorts of odd reactions. In that case, I had a free ticket (VDB voucher) and, given how often I flew cross country for 1 day business meetings, the idea no longer seemed particularly odd to me.

I pretty much don't do out and back MRs, but I do a lot of mini vacation sorts to visit friends, do Volksmarch events, go to baseball games, etc. There is a somewhat different mindset, but it can still be thought of as an MR since the FF miles influence my choice of routing for those trips. (For example, were it not for UA DEQM, I might have chosen AS over UA for an upcoming trip to Seattle during which I will go to one museum and a baseball game.)

One good example of a "good" MR is to get to a higher elite status right before the end of the year. I realize this, but I only think it's worth it if it is a short trip and a person is a few thousand miles or so short of the next elite level.
I've been known to do that too, especially come Novemberish.
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Old Apr 30, 2009, 7:29 am
  #14  
 
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I have begun stretching my MRs to actually be fun weekend get-aways that also rack up lots of miles on-the-cheap. For me it's not enough to spend a day or two just riding in a metal tube, even in F. I like adding a day or two and then go see something. One trip was Xmas shopping in Paris, another trip to FRA included a detour to Stuttgart (excellent car museums). The costs go up with additional meals and hotels, but with a better payback in my view.

I don't get to take much vacation at a time, but a day or two on either side of a weekend (especially 3-day) is easier to get away with work-wise. Also the sampling is fun and gives me a chance to see which places I want to go back to for a real holiday. Also doesn't hurt to have some additional experience with lots of different airports (even train stations) in various countries.

YMMV,
benzguy80
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Old Apr 30, 2009, 9:33 am
  #15  
 
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Everyone has their own economics.

I consider the time I use for an MR to be otherwise worthless, so it's not a factor for me. Our current economic state means I'm not working nearly as much, and I don't need to take vacation days to get enough time away from work. I personally don't have any other productive activities that I'd be otherwise doing. I'm single, childless and have a LOT of free time.

I did an MR last week and am leaving on one Sat morning for an entire week. My total all-in cost was $2,600 including parking, AA platinum challenge, and a Delta lounge membership.

My net is 175K RDM, 100K AA EQM taking me to EXP status until 2/2011, a fistful of 500 mile upgrades, and 8 eVIPs. The value of these instruments FAR exceeds $2,600.
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