GrizShel

I suppose you are supposed to voluntarily pay a higher price for your ticket last2board, otherwise, you are a gamer, leech, parasite, etc. and they'll add things like seeya, don't let the door hit you on the way out, etc.

Some people resent others paying a lower price for a product than they voluntarily or involuntarily pay.

The truth is airfare pricing is very sophisticated and it reflects a lot of analysis of customer behavior by some smart people to figure out the optimal mix of fares to maximize profitability. Sure there are always unanticipated events and factors and they fail sometimes, but they are a whole lot better at this than they used to be.

GUWonder

BA tried this before and only was allowing enrollment in the program and/or acquisition of points toward elite status if booked in higher fares. Years later, BA has backed down and now grant full miles on most fares and all paid fares are good toward BA elite status.

DL also tried to severely undercut elite status qualification on cheaper fares and DL backed out of that too. [I do expect DL to try this again, at least in the absence of a serious DL management/cultural change.]

Even cheap fares provide a material amount of revenue and may be the source of substantial profits when those cheap fares are offered by the airline to fill up the plane and add to marginal income. Publicly-traded airlines aren't charities and they are offering the fares and the frequent flyer programs they do because that is what provides the airline whatever financial oxygen it gets in the environment.

There's a limited supply of whales for the airlines to hunt down or capture. And the biggest whales with half a brain are never prisoners of the fish or whatever else they may feed upon.

Duke777

Interesting if true. For those of us that predominantly earn miles from business travel, I wouldn't mind the change. It'd be quicker to achieve Premium Platinum with a few expensive tix. For example, I'll reach 1P at $15K on North American coach fares.

I'm skeptical of option (c) - the monetary-only requirement. The thresholds seem low if you take more than 3 or 4 trans-oceanic business class trips a year. True, it's good revenue for UA, but the highest level (besides GS) for potentially less than 40k miles?

beltway

I'd be interested in knowing how much UA really competes on lowest fare vs. overall travel experience/FFP. From my limited perspective here in WAS, UA isn't even close to having the lowest fares vs WN, US, others.

If UA is really thinking "they'd show up anyway," that sounds like the same old CO fortress hub mentality.

Driving by DCA

How about a simplified example to show why it could be good for UA to sell you that ticket in the short run and to show you the door in the long run:

Let's apply the Q12010 mainline CASM of around 11cpm since I found it easily using google. That doesn't take into account the different CASM across aircraft and missions, but this is just an example. Also, I'm going to use the great circle distance IAD-MRY-IAD despite the fact that I'm sure there's a connection there somewhere. Wouldn't change the outcome, just the values.

For your IAD-MRY-IAD trip the cost to fly that seat there and back is $530.42.

For simplicity, let's say that the added cost of putting you in the seat (services, RDMs, a touch of extra fuel) is 2cpm since I think that's about what others sorted out up thread. So adding you to the seat costs UA $96.44.

In the short run, UA has two choice since there obviously isn't demand to fill the seat at a higher price than what you paid:
1) It can refuse to sell a ticket at the price you paid and lose $530.42 flying the empty seat across the country and back.

2) It can sell you the ticket at $238 and only lose $388.86 flying you back and forth across the country in the seat.

In the short run the supply side is fixed, and UA would prefer to lose as little as possible so it sells you the ticket.

But, if you only ever buy a bunch of 5cpm tickets then UA loses money on you long term. And long term matters because in the long term they can adjust supply by cutting frequencies and parking/returning planes, deploying more smaller planes, etc.

So in the long term what UA wants to do is get rid of the seat and get rid of you. That way instead of losing $388.86, they lose nothing.

mogulskiir

I hope this is just a rumor but if true it will be the final straw. I grew up flying UA as did my father. I remember as a kid asking him why he flew United and he said because they treated him well. A couple weeks ago when I was talking with him about all the changes and he laughed at me and said why the heck would you fly them.

I think I spend over 8k flying the 100k miles anyway but if having my rear end on a UA plane for that many miles a year isn't enough for this new mgmt then see ya. I do not have the time or desire to try and calculate both miles flown and $ spent to qualify. Yea I'm sure they will post it for you but that is not the point. Figuring out how exactly how to reach it when purchasing tickets is a waste of my time considering all the reductions in benefits to 1K's.

I do business with companies who I feel treat their customers well. There is not a single US carrier who consistently provides passengers with good treatment onboard IMO but United for many years made up with that with their loyalty program.

No sweat off my back as AA provides a great alternative.

UA Insider

Hi Everyone, we understand that you’re anxious to hear about the MileagePlus program changes for 2012. As we’ve said, the details are coming in the fall – specifically, we’re aiming for the end of next month. In the meantime, there will be rumors -- like what’s been posted here -- that unfortunately contain some inaccurate information. As much as we’d like to, until we announce the program fully, we’re not in a position to talk about specific elements or the general direction of the program.

To the extent that we can, we’ll make sure you have an early preview of the full rollout. It goes without saying that we do value your feedback. Keep it coming.

Shannon Kelly
Director, Customer Insights and Metrics
United Airlines

GUWonder

Some inaccurate information? Sounds like this was floated by UA with a substantial amount of the material being a rather accurate representation of what UA is considering.

WineCountryUA

Of this is YMMV, but in/out SF Bay Area for my destinations (most East Coast) UA has been competitive and WN has just been in the middle of the competitive pack (I check 3-4 times and have hardly ever see WN as the cheapest - perhaps if bag fees are included but I carry on)

uastarflyer

In 10 years and 300-400K UA metal miles I've probably spent less than $200 "premium" to fly UA. In vast majority of cases they were tied for lowest, in a few cases outright lowest.

They all pretty much match each other, so that should not be a surprise.

Back to the rumor, if they drop 1P RDM bonus to 50%, all the more reason to open a different FFP and earn *G there - free RCC access as a *G would help offset some of the lost mileage...

Maybe Diamond is being renamed Titanium.

kb1992

Thank you Shannon. This is appreciated.


Please, do NOT follow Delta in a race to the bottom.

entropy

Encouraging higher spend is certainly a goal. Providing perks based on higher fares is something they can focus on (higher RDM/EQM bonus), or including free meals in Y for full fare (AC does this). Ultimately, customers pay higher fares because they need the flexibility/last minute bookings, if they start to sense that the airline is trying to extract higher spend just for "status", then they're going to get pissed off.

Don't forget, ultimately, the marginal traffic DOES make profit for the airline, only 10-20% of customers pay anything resembling a full fare ticket. You certainly want to do what you can to make their life easy. But getting a bunch of people to fly on off-days filling up seats with $50/segment (which the airline would not see otherwise) can make the difference between profit and loss. The "cheapskate" elites are going to be redeeming for unused seats anyways, they're not paying the sleazypass rates.

that's been CO's M.O. for a long time. Who else are you going to fly out of EWR/IAH/CLE where they have 70+% marketshare?

bubbashow

I will step it up a notch (and this is NOT to be rude, but REALISTIC). I think it is UA's goal to MAKE flyers like that leave.

qoodoo

I would still be 1K with these changes... Heck I'd be GS if I moved my international travel to United. However the soft product is crappy so I spend on SQ/CX/OZ. This will help reduce the number of elites I believe with the spending requirements.

Bonehead

@:-)