Hidden City Risk
Jul 20, 2010, 10:48 pm
#76
Join Date: Oct 2009
Programs: UA 1K, Hilton ♦ , Hyatt Carbonado, Wyndham ♦, Marriott PE, "Stinking Bum" elsewhere.
Posts: 4,993
Zombie,
here is some reference material for ya. Glad you trust a serviceman with your life...that means they are doing their job, but here-say does not make something fact, you don't KNOW it to have happened, you only "heard" it happened from someone you trust.
This PR from the GSA is relatively new (this month.) http://www.gsa.gov/portal/content/145193
..."July 1, 2010
Contact: Robert Lesino, (202) 501-1231
[email protected]
WASHINGTON — The U.S. General Services Administration announced today that it has added 749 new destinations and added three new carriers to its federal air travel program City Pairs. This program continues to be the largest managed airline program in the world and provides benefits to federal employees when traveling on official business that are not commercially available. By pairing sets of origins and destinations, City Pairs leverages the buying power of the federal government to price discounted one-way airline tickets estimated to save taxpayers more than $6.3 billion.
For fiscal year 2011 the City Pairs Program has set average federal rates at 68 percent below full commercial air fares and has increased ticketing flexibility for federal travelers. Federal travel varies per agency and mission and this program allows travelers to book the type of ticket they need while allowing for adjustments at no additional cost to the government.
“By leveraging our buying power as a governmentwide contracting arm for federal travel, GSA is able to negotiate prices through City Pairs with 13 air carriers to more than 5,000 locations at a significantly discounted cost to the federal government,” said GSA’s Acting Federal Acquisition Service Commissioner Steven J. Kempf. “Over the past year, GSA’s focus on finding additional cost avoidance while increasing choice and flexibility has once again created an even more dynamic City Pairs program that continues to lead the industry with firm, fixed pricing, flexible policy, and governmentwide savings.”"
I am (and others on this board) are kinda experts on this....you may trust him with your life, but trust us with info regarding this. Not saying it isn't true, just saying that in the long run, the contract clearly (per their own 6+BILLION dollar savings annually) saves the fed $$, and it is overall, in their best interests to maintain the integrity of the contracts. Sometimes, one has to pay more than one could get a fare for, but the flexibility of FREE CHANGES is key. Also, the GSA bids LAST SEAT AVAILABILITY in every market they price. Sometimes they bid a capacity controlled booking class, but always are they able to get their standard rate negotiated on any flight for which a coach ticket can be sold, as long as a contract exists for the market in question.
Other on this board can confirm this to be true. The govt required it to be done in the most costly fashion possible? Not a chance...I get your point, and you are hearing urban legend. I have read GSA contracts before (yes, the entire thing, I am a bit of a contract quoter, as others can attest to.) Link to it can be found here (about 90 pages long): https://www.fbo.gov/index?tab=docume...20b7c392e79fee I can assure you that there is no such provision in them to force "the most expensive way to do it" anywhere in there.
here is some reference material for ya. Glad you trust a serviceman with your life...that means they are doing their job, but here-say does not make something fact, you don't KNOW it to have happened, you only "heard" it happened from someone you trust.
This PR from the GSA is relatively new (this month.) http://www.gsa.gov/portal/content/145193
..."July 1, 2010
Contact: Robert Lesino, (202) 501-1231
[email protected]
WASHINGTON — The U.S. General Services Administration announced today that it has added 749 new destinations and added three new carriers to its federal air travel program City Pairs. This program continues to be the largest managed airline program in the world and provides benefits to federal employees when traveling on official business that are not commercially available. By pairing sets of origins and destinations, City Pairs leverages the buying power of the federal government to price discounted one-way airline tickets estimated to save taxpayers more than $6.3 billion.
For fiscal year 2011 the City Pairs Program has set average federal rates at 68 percent below full commercial air fares and has increased ticketing flexibility for federal travelers. Federal travel varies per agency and mission and this program allows travelers to book the type of ticket they need while allowing for adjustments at no additional cost to the government.
“By leveraging our buying power as a governmentwide contracting arm for federal travel, GSA is able to negotiate prices through City Pairs with 13 air carriers to more than 5,000 locations at a significantly discounted cost to the federal government,” said GSA’s Acting Federal Acquisition Service Commissioner Steven J. Kempf. “Over the past year, GSA’s focus on finding additional cost avoidance while increasing choice and flexibility has once again created an even more dynamic City Pairs program that continues to lead the industry with firm, fixed pricing, flexible policy, and governmentwide savings.”"
I am (and others on this board) are kinda experts on this....you may trust him with your life, but trust us with info regarding this. Not saying it isn't true, just saying that in the long run, the contract clearly (per their own 6+BILLION dollar savings annually) saves the fed $$, and it is overall, in their best interests to maintain the integrity of the contracts. Sometimes, one has to pay more than one could get a fare for, but the flexibility of FREE CHANGES is key. Also, the GSA bids LAST SEAT AVAILABILITY in every market they price. Sometimes they bid a capacity controlled booking class, but always are they able to get their standard rate negotiated on any flight for which a coach ticket can be sold, as long as a contract exists for the market in question.
Other on this board can confirm this to be true. The govt required it to be done in the most costly fashion possible? Not a chance...I get your point, and you are hearing urban legend. I have read GSA contracts before (yes, the entire thing, I am a bit of a contract quoter, as others can attest to.) Link to it can be found here (about 90 pages long): https://www.fbo.gov/index?tab=docume...20b7c392e79fee I can assure you that there is no such provision in them to force "the most expensive way to do it" anywhere in there.
This happened last year, so maybe times have changed. However,
government widely touts the savings they are making across the budget to keep the taxpayers happy, count me as a skeptic who has seen enough both inside and outside to make me believe that this is not true.
Sorry, after seeing as much as I have, I just don't have the rosy view of government that you do.
Jul 20, 2010, 10:59 pm
#77
Join Date: Jun 2004
Location: What I write is my opinion alone..don't read into it anything not written.
Posts: 9,686
They would, allow him to buy a published fare at the published fare rules if they wanted to, but to "make a deal" (as in UA selling him the cheapest fare in the market and throwing out the advanced purchase/capacity/min stay requirements) is not permitted.
There is a clause in that contract that states that a person (and I am too tired to look it up) can buy any fare "generally available to the public, when cheaper than the contract fare", but to try to leverage the buying power of the US govt on an individual "please waive the rules of the cheaper tickets as there is a fare I think is more appropriate" undermines the govt's "big picture" of a standard product with bulk discounts and rules. It is the same as a union, "collective bargaining" where the giant contract gets savings based on volume and a known demand, at the expense of a few cases where someone might be able to get a better price. Sure, if UA paid me what I am worth relative to my peers, my income would go up, and it would be beneficial to me, but the contract, supported by strength in numbers appeals to the bulk of people as well as the company as they gain the same thing they do with the GSA...reliability, fixed costs, known standard rules...
Anyway, bed time for me. Read the contract if you want, again, I have, and know of which I speak. Trust me, or don't. There is no point in believing a story from a friend that is not a subject matter expert over a person who is, but the choice is yours.
LOL, and I don't have a rosy view of the govt per se either, but I do believe that volume discounted contracts usually benefit those involved, and the biggest purchaser in the US says it does, and benefits them greatly. Of that, I can agree with them on. There are side benefits to this contract as well for the govt, as those that participate must make aircraft available to the govt in times of war (CRAF.) So the nuances and all the benefits of "playing by the rules" require someone to either know the contract, the program, and the rules, or believe someone who does.
There is a clause in that contract that states that a person (and I am too tired to look it up) can buy any fare "generally available to the public, when cheaper than the contract fare", but to try to leverage the buying power of the US govt on an individual "please waive the rules of the cheaper tickets as there is a fare I think is more appropriate" undermines the govt's "big picture" of a standard product with bulk discounts and rules. It is the same as a union, "collective bargaining" where the giant contract gets savings based on volume and a known demand, at the expense of a few cases where someone might be able to get a better price. Sure, if UA paid me what I am worth relative to my peers, my income would go up, and it would be beneficial to me, but the contract, supported by strength in numbers appeals to the bulk of people as well as the company as they gain the same thing they do with the GSA...reliability, fixed costs, known standard rules...
Anyway, bed time for me. Read the contract if you want, again, I have, and know of which I speak. Trust me, or don't. There is no point in believing a story from a friend that is not a subject matter expert over a person who is, but the choice is yours.
LOL, and I don't have a rosy view of the govt per se either, but I do believe that volume discounted contracts usually benefit those involved, and the biggest purchaser in the US says it does, and benefits them greatly. Of that, I can agree with them on. There are side benefits to this contract as well for the govt, as those that participate must make aircraft available to the govt in times of war (CRAF.) So the nuances and all the benefits of "playing by the rules" require someone to either know the contract, the program, and the rules, or believe someone who does.
Jul 20, 2010, 11:01 pm
#78
Join Date: Jul 2001
Location: Chicago
Posts: 2,682
Personally I think UA will not be able to show damages. pretend pax buys one way SFo-ORD-MKE for $129 and SFO-ORD was $299 at the time and $999 last minute.
Normally the damages in a contract dispute will be measured by giving the plaintiff the benefit of his bargain. Here UA bargained to transport passenger to MKE for $129. There was no contract to ORD. So for UA to receive the benefit of their bargain they would need to receive $129 which is what they got.
It would be nice for UA to argue that they lost revenue because they would have gotten $170 more or even $870 more but nobody ever made that bargain with UA. I don't see how UA is going to argue that they are missing anything. If they are missing anything it is having a passenger on the plane from ORD-MKE. I suppose if UA hired somebody to take that seat then maybe they could sue for whatever he was paid.
ALso there is a reason why I never read a case like this in law school. Its because there is really no other example where anybody charges you more to use less product or service. Its pretty ludicrous and while I agree that its part of the contract I don't see the damages being awarded in court.
Normally the damages in a contract dispute will be measured by giving the plaintiff the benefit of his bargain. Here UA bargained to transport passenger to MKE for $129. There was no contract to ORD. So for UA to receive the benefit of their bargain they would need to receive $129 which is what they got.
It would be nice for UA to argue that they lost revenue because they would have gotten $170 more or even $870 more but nobody ever made that bargain with UA. I don't see how UA is going to argue that they are missing anything. If they are missing anything it is having a passenger on the plane from ORD-MKE. I suppose if UA hired somebody to take that seat then maybe they could sue for whatever he was paid.
ALso there is a reason why I never read a case like this in law school. Its because there is really no other example where anybody charges you more to use less product or service. Its pretty ludicrous and while I agree that its part of the contract I don't see the damages being awarded in court.
Jul 20, 2010, 11:29 pm
#79
Join Date: Oct 2009
Programs: UA 1K, Hilton ♦ , Hyatt Carbonado, Wyndham ♦, Marriott PE, "Stinking Bum" elsewhere.
Posts: 4,993
They would, allow him to buy a published fare at the published fare rules if they wanted to, but to "make a deal" (as in UA selling him the cheapest fare in the market and throwing out the advanced purchase/capacity/min stay requirements) is not permitted.
There is a clause in that contract that states that a person (and I am too tired to look it up) can buy any fare "generally available to the public, when cheaper than the contract fare", but to try to leverage the buying power of the US govt on an individual "please waive the rules of the cheaper tickets as there is a fare I think is more appropriate" undermines the govt's "big picture" of a standard product with bulk discounts and rules. It is the same as a union, "collective bargaining" where the giant contract gets savings based on volume and a known demand, at the expense of a few cases where someone might be able to get a better price. Sure, if UA paid me what I am worth relative to my peers, my income would go up, and it would be beneficial to me, but the contract, supported by strength in numbers appeals to the bulk of people as well as the company as they gain the same thing they do with the GSA...reliability, fixed costs, known standard rules...
Anyway, bed time for me. Read the contract if you want, again, I have, and know of which I speak. Trust me, or don't. There is no point in believing a story from a friend that is not a subject matter expert over a person who is, but the choice is yours.
LOL, and I don't have a rosy view of the govt per se either, but I do believe that volume discounted contracts usually benefit those involved, and the biggest purchaser in the US says it does, and benefits them greatly. Of that, I can agree with them on. There are side benefits to this contract as well for the govt, as those that participate must make aircraft available to the govt in times of war (CRAF.) So the nuances and all the benefits of "playing by the rules" require someone to either know the contract, the program, and the rules, or believe someone who does.
There is a clause in that contract that states that a person (and I am too tired to look it up) can buy any fare "generally available to the public, when cheaper than the contract fare", but to try to leverage the buying power of the US govt on an individual "please waive the rules of the cheaper tickets as there is a fare I think is more appropriate" undermines the govt's "big picture" of a standard product with bulk discounts and rules. It is the same as a union, "collective bargaining" where the giant contract gets savings based on volume and a known demand, at the expense of a few cases where someone might be able to get a better price. Sure, if UA paid me what I am worth relative to my peers, my income would go up, and it would be beneficial to me, but the contract, supported by strength in numbers appeals to the bulk of people as well as the company as they gain the same thing they do with the GSA...reliability, fixed costs, known standard rules...
Anyway, bed time for me. Read the contract if you want, again, I have, and know of which I speak. Trust me, or don't. There is no point in believing a story from a friend that is not a subject matter expert over a person who is, but the choice is yours.
LOL, and I don't have a rosy view of the govt per se either, but I do believe that volume discounted contracts usually benefit those involved, and the biggest purchaser in the US says it does, and benefits them greatly. Of that, I can agree with them on. There are side benefits to this contract as well for the govt, as those that participate must make aircraft available to the govt in times of war (CRAF.) So the nuances and all the benefits of "playing by the rules" require someone to either know the contract, the program, and the rules, or believe someone who does.
I enjoyed conversing with you tonight.
Jul 21, 2010, 12:49 am
#80
Join Date: Jan 2005
Location: San Francisco
Programs: All-Around Kettle
Posts: 3,287
It would be nice for UA to argue that they lost revenue because they would have gotten $170 more or even $870 more but nobody ever made that bargain with UA. I don't see how UA is going to argue that they are missing anything. If they are missing anything it is having a passenger on the plane from ORD-MKE. I suppose if UA hired somebody to take that seat then maybe they could sue for whatever he was paid.
Moreover, whether UA "lost" something tangible is also irrelevant. Can one not recover damages for thefts of intellectual property? What tangible thing does the property owner "lose" in those situations? And in any event, in this situation, UA does lose something tangible: the use of that seat from SFO to ORD.
Jul 21, 2010, 1:24 am
#81
Moderator: United Airlines
Join Date: Jun 2007
Location: SFO
Programs: UA Plat 1.995MM, Hyatt Discoverist, Marriott Plat/LT Gold, Hilton Silver, IHG Plat
Posts: 66,821
I'm no lawyer or even pretend to understand contract law, but it seems if you make a deal with another party based on information you supplied and the supplied information (such where you want to travel to) is deliberately false knowing the other party would offer different terms if provided the true information -- you have crossed a boundary, whether or not you feel the offered terms were fair. You made a voluntary choice to supply false information. I would hope others I entered into contracts with cannot this and not face consequences. Sort a a Golden Rule situation.
Jul 21, 2010, 6:04 am
#82
Join Date: Sep 2008
Posts: 350
As an uneducated blue collar worker, how does one challenge a contract one has agreed to that one considers unconscionable? Is it saying at the time of ticketing "I refuse to agree to this, I will pick and choose what I want, and if you refuse to sell me on those terms, I will not agree to these terms"?, is it in court, or can one just decide to do whatever you want? My guess is the 1st one would work, the 2nd might work, the 3rd...well, is that the way this works?
Whether this seems right to you, I'll leave up to you, but it is how it works and the end result is that many of the terms in these contracts will be deemed unenforceable if brought before a court.
Jul 21, 2010, 8:47 am
#83
Join Date: Jun 2004
Location: What I write is my opinion alone..don't read into it anything not written.
Posts: 9,686
The basic idea of a contract is that it's something that is fairly negotiated by between two parties having equal, or near equal, bargaining power. Since this is not at all the case with take it or leave it, drawn up by one party, contracts (e.g. United's CoC), the courts take special care to ensure that the terms are not unfair to the party not having the power, that did not draw up the contract.
Whether this seems right to you, I'll leave up to you, but it is how it works and the end result is that many of the terms in these contracts will be deemed unenforceable if brought before a court.
Whether this seems right to you, I'll leave up to you, but it is how it works and the end result is that many of the terms in these contracts will be deemed unenforceable if brought before a court.
It is the person that wants to fly from ORD-LAX on the MKE-LAX fare that doesn't have choices, as only UA and AA fly that route and connect on to MKE. Wouldn't a court see this as the consumer being fraudulent. They negotiate with many options and equal power to fly MKE-LAX, but choose to use one of the 2 airlines that they can cheat as they targeted those airlines for route structure to achieve what they want at a price they don't want, but what the seller is unwilling to sell at that price.
Now if it were a route and a price offered only by 1 carrier, and the person had no choice (other than to not fly) I could see an argument that the parties didn't have such equal power. (Even though the purchaser still has the power to not enter into the agreement...flying is not a right, like the need for water or electricity, but a luxury to save them time and money.)
So my gist is, that yes, UA sets the terms, but the passenger has equal power in accepting or denying those terms, and also has the power to choose many other carriers that sell the same product under those terms. To me, this negates the unfair advantage one carrier has over the consumer when the consumer has many options, including the most important one of choosing not to agree to the terms. Take it or leave it...well, it isn't like the person then cant fly, he just has to take ONE of the many options available, or he can leave it, or take it.
As for fairly negotiated, how is negotiating one product, and then taking another one considered "fairly negotiated"? The other product, if the consumer wishes to negotiate for (the ORD-LAX) is an option for him that he/she choose not to contract with, so the unilateral change is by the consumer, not by the vender. The consumer has choices, the vender in this case had no choice to either agree or not to to the abuse of the terms. Arguing that one had little choice as to the actual terms of the contract...well does that mean that the person then gets to define their own contract, and the vender, which has an agreement from them is left powerless?
I'm learning a lot on this board the last few days, so forgive the questions that seem wierd. Makes me want to go back to school. LOL, do you think UA would give me an educational leave and pay for my education?
Last edited by fastair; Jul 21, 2010 at 8:53 am
Jul 21, 2010, 9:10 am
#84
Join Date: Feb 2000
Posts: 6,544
If UA wants to compete on price in the LAX-MKE market without harming its margins in the LAX-ORD market, then UA should fly LAX-MKE nonstop. There is nothing immoral about buying a ticket LAX-ORD-MKE and using only the LAX-ORD segment. Morality is not defined by the artificial constructs created by corporations to maximize profit or by whether a court would choose to enforce such rules.
Jul 21, 2010, 9:17 am
#85
Join Date: Feb 2005
Location: PHL & (gasp) AVP (NEPA)
Programs: UA 1K
Posts: 787
ALso there is a reason why I never read a case like this in law school. Its because there is really no other example where anybody charges you more to use less product or service. Its pretty ludicrous and while I agree that its part of the contract I don't see the damages being awarded in court.
They might also lose the ability to cancel an itin for a missed segment.
Right now they can just go, "blah, blah, blah ,CoC, Blah, Blah,Coc" and 99% of people will just follow the terms.
Also I was never presented with, asked to read or agree to any terms before I competed a purchase. Shaky ground for any "contract" (can you say more Senate hearings :-O)
Jul 21, 2010, 9:26 am
#86
Join Date: Jun 2004
Location: What I write is my opinion alone..don't read into it anything not written.
Posts: 9,686
Again, refer to your Hilton posts as to how to claim to be employed by a company that gets a discount when one isn't.
Jul 21, 2010, 9:41 am
#87
Join Date: Feb 2000
Posts: 6,544
It is not immoral to hidden-city ticket.
Not immoral to use corporate rate codes at hotels.
Not immoral to book a car at hertz.co.uk b/c its cheaper than .com and with a Travel Partners CDP code that I have no idea what the hell is.
Not immoral to register for targeted-only promos even when not targeted.
Not immoral to "move" to NYC for the latter half of 2009 to get double AA miles.
Not immoral to churn Citi credit cards for hundreds of thousands of miles.
Not immoral to give a drink chit to a FA and get a free wrap back.
Not immoral slip a $20 to the check-in clerk and hope for a nicer room.
Not immoral to accept a bottle of wine from a flight attendant.
Acting the way corporations would like does not define morality.
Not immoral to use corporate rate codes at hotels.
Not immoral to book a car at hertz.co.uk b/c its cheaper than .com and with a Travel Partners CDP code that I have no idea what the hell is.
Not immoral to register for targeted-only promos even when not targeted.
Not immoral to "move" to NYC for the latter half of 2009 to get double AA miles.
Not immoral to churn Citi credit cards for hundreds of thousands of miles.
Not immoral to give a drink chit to a FA and get a free wrap back.
Not immoral slip a $20 to the check-in clerk and hope for a nicer room.
Not immoral to accept a bottle of wine from a flight attendant.
Acting the way corporations would like does not define morality.
Jul 21, 2010, 10:17 am
#88
Join Date: Jul 2001
Location: Chicago
Posts: 2,682
I'm no lawyer or even pretend to understand contract law, but it seems if you make a deal with another party based on information you supplied and the supplied information (such where you want to travel to) is deliberately false knowing the other party would offer different terms if provided the true information -- you have crossed a boundary, whether or not you feel the offered terms were fair. You made a voluntary choice to supply false information. I would hope others I entered into contracts with cannot this and not face consequences. Sort a a Golden Rule situation.
I am not sure I agree with you there. It seems irrelevant that "nobody ever made that bargain," as UA may argue that its damage was being underpaid by at least $170 (and up to $870) for a service that it did provide pursuant to a contract.
Moreover, whether UA "lost" something tangible is also irrelevant. Can one not recover damages for thefts of intellectual property? What tangible thing does the property owner "lose" in those situations? And in any event, in this situation, UA does lose something tangible: the use of that seat from SFO to ORD.
Moreover, whether UA "lost" something tangible is also irrelevant. Can one not recover damages for thefts of intellectual property? What tangible thing does the property owner "lose" in those situations? And in any event, in this situation, UA does lose something tangible: the use of that seat from SFO to ORD.
How does UA lose the seat from SFO-ORD. THey already agreed to use it for the customer flying to MKE. UA had no expectation that the seat would be empty or available for sale. If they wanted to use it for a higher ORD fare then they did not have to sell it on a MKE fare.
Overall point is that UA got exactly what it was promised which was $129. It did not have to provide any more services than what it promised either. Showing any damages is going to be near impossible in my opinion.
Last edited by iluv2fly; Jul 21, 2010 at 10:36 am Reason: merge
Jul 21, 2010, 10:37 am
#89
Join Date: Jan 2005
Location: San Francisco
Programs: All-Around Kettle
Posts: 3,287
How does UA lose the seat from SFO-ORD. THey already agreed to use it for the customer flying to MKE. UA had no expectation that the seat would be empty or available for sale. If they wanted to use it for a higher ORD fare then they did not have to sell it on a MKE fare.
Jul 21, 2010, 10:38 am
#90
Join Date: Jun 2004
Location: What I write is my opinion alone..don't read into it anything not written.
Posts: 9,686
So if the penalty for UA not getting you there is a payment made and determined and agreed upon in the contract, then shouldn't the penalty for NOT taking the same flight be calculated in a similar way? Further isn't always more expensive. One can route many ways. One can go past the end destination on the ticket and have a bit of a backhaul, does this mean if UA cncls the last leg, that they owe you nothing, and should get paid addl as they carrier you BEYOND the point for which they agreed? This shows, it isn't flights or mileage or routing, otherwise UA would own NOTHING on a cncld flight when the connection is beyond the destination, but rather it is based on origin and destination tariffs.
People ask how you define damages, if a customer can demand that the airline fulfill their end of the contract, why then can't the vender require the same thing? Round in circles we go, but to say UA was only promised $129....better look at what you agree to before stating that you only agree to pay the fare.