HonestABE

With all of the announced fare increases, my air travel plans have definitely changed - at least for the summer. Three examples.

I usually fly with one my kids to the Southwest during August. In past years, fares have been reasonable enough to buy those tix (last August, for example, my son and I flew to TUS for $552 R/T for the both of us). This August, it's around $1,600, so I used saver awards for both tix.

I also usually fly on business to the Left Coast every July. Fares (for dates, times and equipment I prefer) are now to the point where I will put off that trip at least until fall.

Finally, I have some business trips I normally take to non-hub airports over the summer months. Those fares have skyrocketed, so those trips are now on hold.

All told, I have placed "on hold" (or substituted saver awards for ticket purchases) about 20K miles of flying the next 3 months.

Have you changed your plans as well?

fzwinter

Ironically, now that we're facing several carriers with significant charges for baggage, I find that while UA's fares are higher, my out-of-pocket costs are still usually lower because I often check three pieces (I'm a musician) for free as a 1P. Considering excess baggage charges would impact both ways of a trip on another carrier, I'm usually better off flying on UA. If the cost difference is close, then UA will get my business because of E+ and 100% RDM bonus.

Mike Jacoubowsky

I haven't read the fine print regarding AA's decision to charge $15 for the first checked bag, but I assume some level of status eliminates it. Which makes me wonder...

Will some airline be so bold as to make a pledge that they won't nickel & dime their elites to death? That might be one of the few meaningful benefits left, after you take away service quality and convenient schedules, both of which are likely to be things of the past.

But for now, I wouldn't assume that checking 3 pieces of luggage will continue to be an elite perk. UA, in all likelihood, will come out with a press release talking about the hardships high fuel costs have created for all, and that they are doing their part by flying a bit slower and making sure that passengers are allowed to bring aboard a reasonable amount of luggage before extra charges kick in. And with that the elites will be back to 2 pieces of free luggage, with a nominal charge for the 3rd. GMs will have escalating fees such that a 3rd bag would represent an expense few would want to consider.

HonestABE

Mike,

I think you are spot on here. I have to believe all the legacies are seriously analyzing the perks they can continue to provide to their elites.

My guess is that some changes will be subtle - for example, saver award inventories during peak periods will be sharply reduced, and allocated based on status level. The miles needed for a free ticket may also be adjusted - which can be justified (at least in the minds of some) based on much higher fuel costs.

The real question is whether sustained high fuel prices (and higher ticket prices) will dramatically reduce the public's demand for air travel (both leisure and business), and how each airline responds in attempting to capture as much of that reduced demand as possible.

In my case, making 1K again is simply out of the question (unless, of course, some sugar daddy pays me to do a couple transpacs in C or F ), so I'm in a miles-burning mode the rest of the year for my leisure travel. That could extend into next year as well, especially if I become concerned that UA will try to devalue those miles.

MatthewLAX

If there reaches a point when I can no longer consistently find a transcon between LAX and WAS for under $325 and competitors (like AS) are cheaper, I will switch.

aerokitty

Once the reality of $4/US gal Jet-A sinks in, the days of $300 transcons are gone. The big question is when business travel, the bread and butter of the legacies is seriously curtailed by industry. I cannot imagine corporations not doing something to reduce travel when the typical transcon ticket hits $1K, something not unreasonable given the cost of fuel.

Dsybok

Even at $1k a ticket, the benefits of business travel far outweigh the costs. For me, there is no fare within reason at which my habits change. Just today I bought a ticket LAX-SFO SMF-LAX multicity which would have cost me $250last year and was $410 today. I didn't bat an eye, my boss won't either.

I typically only take 1 or 2 flights a year that are not paid for by the company, and my wife usually flies on miles. I don't expect my company to curtail travel costs any more than they already have in recent years, and making a trip to pick up an order for $250,000 makes even a $1k ticket inconsequential. Don't forget that businesses write off employee travel costs, so they don't really care how much the ticket is, especially bigger businesses, I expect mom and pops would be more concerned, but those folks are flying Southwest and Jet Blue anyway.

D

mooper

For business, I'm right on with Dysbok. Typically, business gain from a trip is overwhelmingly more than the ticket price. In a lot of cases, I'd pay $1/mile flown and still wind up ahead. Not much price sensitivity here.

For leisure, I am much more sensitive. I would probably pay 50% more before changing my habits much, then I would begin to reduce my trips. One thing that would offset this would be if the airlines would start charging for more things ala carte and providing more items that can be purchased in this manner. For example, if I could fly and pay for drinks and food like I would in a restaurant (and tip the flight attendant accordingly), I'd pay much more for my ticket because the flight would be more enjoyable. Same for internet access and other similar services (entertainment, comfort).

mauiUAflyer

My business travel is almost always >$700/ticket. And it is generally worth it. Often it is last minute (except for conferences, which have dates fixed well in advance). Those are at the low end, with the invariable last-minute meeting costing >$1,000. Often it has to be a Y/B fare, as the meeting might switch dates or just disappear. The hassles of changing/refunding a ticket for a business trip are just too much.

My personal travel is usually booked well in advance, or falls atop one of the mainland conferences. Flying in the lower 48 is generally cheaper than flying to-from HI. And I usually have some sort of voucher to cushion the blow.

Things haven't gotten out of hand...yet.

Of course, I started flying before deregulation, and things are still relatively inexpensive, in comparison to '70's dollars. And no more People's Express!

Mike Jacoubowsky

I've owned a business for 29 years, and still marvel at how easily people say "businesses write off employee travel costs" (or any other costs, for that matter).

There is a finite amount of money in any business (OK, maybe not Google...). And it can be spent any number of ways. Yes, you could spend it on flying them around the country to meet with clients. But that's $$$ that you've chosen to spend that way instead of, say, paying your employees more. Or reducing prices to remain competitive. Or solidifying pension plans that have gone south. Lots of things that a business can do, which are all "expenses." But just because they're "expenses" doesn't make them free. They're not. They're $$$ spent in one area that cannot be spent in another.

Ideally, every expense on the books requires justification and continual re-analysis. What made sense yesterday may not make sense tomorrow. There's nothing so unique about travel expense that makes it immune to critique.

That's not to say that you can substitute in-person visits with phone calls and teleconferencing and such. But when things get tight, clients may be more interested in competitive pricing than personal visits, at least in the short run.

cmculp

[QUOTE=The real question is whether sustained high fuel prices (and higher ticket prices) will dramatically reduce the public's demand for air travel (both leisure and business), and how each airline responds in attempting to capture as much of that reduced demand as possible.
[/QUOTE]


Bingo. For me, I'm pst the point of change (can't afford some of what I routinely used to do, so my own dollar demand is already down. Business (almost all government contract fares) are still locked through end of fiscal year, so stable for now. Next year the contract fares will fly north, but the amount of money in our travel budgets will be static of 5% up, so demand will fly south.

A poster above said oil prices will fall. I hope he's right, but fear we are entering a long term new normal.

FiveMileFinal

In both my lines of work, flying is required. Unlike people, computers are mostly hands-on and can't be teleconferenced to. So where the computers are, I gotta go. Same with music...gotta go where the people like your stuff. Kinda hard to teleconference a gig

Obviously I'll look for the best fares, that's just common sense. But unless they start charging 4 and 5-digit fares for economy, I'll still be going.

Eastbay1K

10 years ago, I used to think that $400 was a "fair" price, and anything less was a bargain. Now, if "we" pay that much, it is "outrageous."

I don't know what my personal tipping point is, but I don't fly UA very much anymore - but I don't fly anyone very much anymore, and it isn't a fare issue. But it is partially an issue of "I don't care about my top status so much anymore." 1P on UA and MVPG on AS suit me fine. I've still been able to redeem miles with not-too-much difficulty (some, but nothing horrendous). When that changes, all bets may be off.

As for the post I'm quoting, if you can go transcon for the price of 3 tanks of gas each way, in 5 hours instead of 5 days, and no lodging required along the way, you have a steal. And remember, those fares now contain a bucket of extra taxes and fees that didn't exist 10 years ago.

giggy

I just priced out sea-slc yikes $550+ and that was 30 days out. Thats too much for me, esp considering I just went sea-dfw-nrt on AA for $675+ I realize they have to get fares up, but if they get really out in the stratosphere MR's for status may turn into a losing proposition.

harryhv

I'll still fly as much as before but will book further ahead and take the most direct (and cheapest) route regardless of carrier.

The tipping point for giving up on chasing UA1k is not so much the fares but rather the abrupt decline in service as UA abandoned Oz, closing the SYD office and firing everyone from airport staff to 1k phone agents. Not to mention sending us the most mech-prone part of the fleet. And the effective devaluation of all our RDMs by that evil StarNet programmer who blacks out the good *A partner-award-seats.

Now my *A miles, when they happen to occur, are going to BD-DC and my dollars are going to the most reliable operator with the fewest connections.