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General => The Cantina => Topic started by: Fuzzy on June 20, 2008, 08:01:23 PM



Title: I must be missing something
Post by: Fuzzy on June 20, 2008, 08:01:23 PM
How exactly does this 1) improve revenue or 2) cut costs?

Are they now in the hotel business? I remember the days of getting sweet fares for Saturday night stays but that had to do with filling planes. The supply/demand dealio.

I need to research this one a bit because I swear United is actively trying to go out of business.


http://www.msnbc.msn.com/id/25288127/

Quote
NEW YORK - United Airlines said Friday it will start requiring minimum stays for nearly all domestic coach seats beginning in October. It is also raising its cheapest fares by as much as $90 one-way.

The second-largest U.S. carrier said the moves are among a number of changes, including flight and job cutbacks, it is making to combat record high fuel prices.

The Chicago-based airline has been among the industry's most aggressive in pushing fares and fees higher in recent months, and those efforts have often been matched by other carriers. The industry is scrambling to raise revenue in a fight to forestall what is projected to be a record multibillion industrywide loss this year.

Starting Oct. 6, most of United's economy-class fares will require a one- to three-night or weekend-night minimum stay, spokeswoman Robin Urbanski said. The policy does not apply to fliers in other classes.

The new rules are bound to be unpopular with business travelers who prefer to catch a flight out early in the morning so they can be back home in time for dinner.

"They'll push back big time," said Mike Boyd, a Colorado-based aviation consultant. "It's one thing to simply raise fares. It's quite another to do it by imposing restrictions that appear to make it harder to conveniently fly."

Major carriers scrapped most minimum-stay rules — put in place largely to discourage big-budget corporate travelers from snatching up the cheapest seats — at the start of the decade, although United and other airlines recently started bringing the overnight rules back piecemeal.

Friday's changes are far more sweeping because they also apply to highly competitive routes where United goes head-to-head against lower-cost rivals such as Southwest Airlines and JetBlue Airways.

"What we did this week was almost across the board," Urbanski said. "At the end of the day, it's all about improving our profit as we combat these record high fuel prices."


Title: Re: I must be missing something
Post by: Fuzzy on June 20, 2008, 08:06:45 PM
I just read the last line I quoted again and have a question for Robin:

If you are flying a route every day, how are you improving profits by forcing me to take the flight on Thursday when I wanted to come back on the flight on Tuesday?

I've paid the fare. Does it matter if I'm on Flight XYZ Tuesday or Thursday?

I must have had one too many tonight. I can't figure out the reasoning behind the minimum stay. Just raise your damn ticket prices and quit playing the games.


Title: Re: I must be missing something
Post by: gleek on June 20, 2008, 08:09:38 PM
The answer is right here:

Quote
Major carriers scrapped most minimum-stay rules — put in place largely to discourage big-budget corporate travelers from snatching up the cheapest seats — at the start of the decade, although United and other airlines recently started bringing the overnight rules back piecemeal.

The carriers probably make most of their money off business travellers.


Title: Re: I must be missing something
Post by: Uisce Beatha on June 20, 2008, 08:10:32 PM
My guess would be that there are high traffic days and low traffic days.  By requiring (multi-)overnight stays they feed the light days.  They have to run the routes pretty much every day to have planes in the right place for the following morning.

In argument with my argument is the fact that I haven't been on a domestic flight that's anything less than oversold in three years.

So WTF do I know?

Rant on.


Title: Re: I must be missing something
Post by: Fuzzy on June 20, 2008, 08:15:42 PM
The answer is right here:

Quote
Major carriers scrapped most minimum-stay rules — put in place largely to discourage big-budget corporate travelers from snatching up the cheapest seats — at the start of the decade, although United and other airlines recently started bringing the overnight rules back piecemeal.

The carriers probably make most of their money off business travellers.

Not probably, they do. Always have.

If I'm selling something I think I'd like the big budget {insert whoever here} on my side.


Title: Re: I must be missing something
Post by: Fuzzy on June 20, 2008, 08:20:43 PM
My guess would be that there are high traffic days and low traffic days.  By requiring (multi-)overnight stays they feed the light days.  They have to run the routes pretty much every day to have planes in the right place for the following morning.

In argument with my argument is the fact that I haven't been on a domestic flight that's anything less than oversold in three years.

So WTF do I know?

Rant on.

Yeah, I'm ranting for no particular reason. I don't fly United and really don't care how they run their business.

But they have a way to fill the light routes/days. Price those particular flights cheaper. I don't see how the minimum stay does this unless it's pretty selective. In other words, if they are making me stay 2 nights when I go visit Graceland no matter when I fly that tells me they aren't filling light planes. I know that was the reason for the Saturday night stay cheap fares. The first preference of business travelers would not be to stay somewhere on a weekend. But I remember some great fares if you did.

And you're right. If you have flown on a plane the past couple of years that hasn't been full you have tons of money and were kickin' it private.


Title: Re: I must be missing something
Post by: Uisce Beatha on June 20, 2008, 08:24:14 PM
Half my friends are airline pilots.  I'll gather an opinion or two and report back.  Not that they'll necessarily know, drunk bastards the lot.


Title: Re: I must be missing something
Post by: Spanky on June 20, 2008, 08:25:45 PM
Half my friends are airline pilots.  I'll gather an opinion or two and report back.  Not that they'll necessarily know, drunk bastards the lot.
I hope none of them work SWA.


Title: Re: I must be missing something
Post by: Fuzzy on June 20, 2008, 08:26:57 PM
Half my friends are airline pilots.  I'll gather an opinion or two and report back.  Not that they'll necessarily know, drunk bastards the lot.

They work for Northwest?  ;) ;D

Like I said, I find this more curious than anything. If they are in competitive routes it seems they will be losing business travelers to another carrier who may not require the same minimum stay.



Title: Re: I must be missing something
Post by: Uisce Beatha on June 20, 2008, 08:29:42 PM
Half my friends are airline pilots.  I'll gather an opinion or two and report back.  Not that they'll necessarily know, drunk bastards the lot.
I hope none of them work SWA.

One does.

I'm joking of course.  They're mostly ex- or nearly ex-fighter pilots and the movies don't lie too much about how hard these guys party (well, prior to turning into old guys like me.)  But when it comes to flying they're deadly serious.  There is zero chance they'd get near a cockpit with any effects, residual or not, of alcohol in their systems.

Smart guys too.  But they like to play dumb.  "Pull up, houses get smaller.  Push down, houses get bigger."


Title: Re: I must be missing something
Post by: Fuzzy on June 20, 2008, 08:32:38 PM
I've got a buddy who was a pilot until just after 9/11. Same thing - used to party like a rock star but it was letter of the law stuff when it came to flying. I respected him greatly for that.


Title: Re: I must be missing something
Post by: stroh on June 20, 2008, 09:12:39 PM
I could fly a plane.


Title: Re: I must be missing something
Post by: Uisce Beatha on June 20, 2008, 09:14:42 PM
I could fly a plane.

(http://www.thegrandparentzone.com/my_files/Image/corsair.jpg)


Title: Re: I must be missing something
Post by: stroh on June 20, 2008, 09:17:20 PM
 [sm_laughing]


Title: Re: I must be missing something
Post by: gleek on June 20, 2008, 09:20:17 PM
Pappy.Boyington.surrenders

(http://www.fiftiesweb.com/tv/black-sheep-rc2.jpg)


Title: Re: I must be missing something
Post by: stroh on June 20, 2008, 09:31:13 PM
Pappy.Boyington.surrenders

(http://www.fiftiesweb.com/tv/black-sheep-rc2.jpg)

LOL  I grew up watching that show!  Kick ass.

I'm probably more like:

(http://www.tigersweat.com/images/air11.jpg)


Title: Re: I must be missing something
Post by: Clive on June 21, 2008, 08:46:34 PM
I think you're looking at it wrong.  United isn't scrapping all fares save those with the minimum-stay requirement.  If staying 2 nights isn't in your cards, there's a higher fare you can buy from United that will suit your preferences.  I suspect they're banking on the majority of folks buying that higher-cost fare instead of extending the trip.


Title: Re: I must be missing something
Post by: gleek on June 22, 2008, 10:10:07 AM
I think you're looking at it wrong.  United isn't scrapping all fares save those with the minimum-stay requirement.  If staying 2 nights isn't in your cards, there's a higher fare you can buy from United that will suit your preferences.  I suspect they're banking on the majority of folks buying that higher-cost fare instead of extending the trip.

IOW, why does United hate Korprit 'Merka?


Title: Re: I must be missing something
Post by: Clive on June 22, 2008, 11:10:16 AM
Because they hate bankruptcy more?


Title: Re: I must be missing something
Post by: gleek on June 22, 2008, 11:35:01 AM
Because they hate bankruptcy more?

I have no problem with their strategy. I'm just reiterating my first point that their motivation was to force more business travellers to purchase full fare tickets in order to increase revenue originally lost by business travellers buying up the economy fares intended for leisure travellers.


Title: Re: I must be missing something
Post by: Fuzzy on June 22, 2008, 03:50:19 PM
I think you're looking at it wrong.  United isn't scrapping all fares save those with the minimum-stay requirement.  If staying 2 nights isn't in your cards, there's a higher fare you can buy from United that will suit your preferences.  I suspect they're banking on the majority of folks buying that higher-cost fare instead of extending the trip.

I guess my point was to just raise fares then and don't play games with minimum stays (and paying for checked luggage).

But at least they can still advertise a $400 fare that really is $800 once you dig into it.



Title: Re: I must be missing something
Post by: gleek on June 22, 2008, 04:12:20 PM
I think you're looking at it wrong.  United isn't scrapping all fares save those with the minimum-stay requirement.  If staying 2 nights isn't in your cards, there's a higher fare you can buy from United that will suit your preferences.  I suspect they're banking on the majority of folks buying that higher-cost fare instead of extending the trip.

I guess my point was to just raise fares then and don't play games with minimum stays (and paying for checked luggage).

But at least they can still advertise a $400 fare that really is $800 once you dig into it.

They need to advertise the $400 fares to fill the empty seats when they need to, but they don't want the people who can afford to pay $800 (i.e. business customers) to take up all the $400 fares, leaving the leisure traveler to choose between paying 800 bones and staying home. Leisure travelers theoretically should have more flexibility in scheduling their travel.


Title: Re: I must be missing something
Post by: Fuzzy on June 22, 2008, 04:29:51 PM
I think you're looking at it wrong.  United isn't scrapping all fares save those with the minimum-stay requirement.  If staying 2 nights isn't in your cards, there's a higher fare you can buy from United that will suit your preferences.  I suspect they're banking on the majority of folks buying that higher-cost fare instead of extending the trip.

I guess my point was to just raise fares then and don't play games with minimum stays (and paying for checked luggage).

But at least they can still advertise a $400 fare that really is $800 once you dig into it.

They need to advertise the $400 fares to fill the empty seats when they need to, but they don't want the people who can afford to pay $800 (i.e. business customers) to take up all the $400 fares, leaving the leisure traveler to choose between paying 800 bones and staying home. Leisure travelers theoretically should have more flexibility in scheduling their travel.

You missed my point, it's not $400. It's $400 plus fees and taxes plus $ for checked luggage plus $ for 'oh, you want to come home tomorrow instead of Thursday' equals $800.

There are no such thing as "business fares" and "leisure fares". Just fares. When I traveled a lot for business anybody could buy the ticket at the price given by the airline. They didn't ask if it was for business or leisure. And we booked through travel agents and by ourselves.

And business travelers have always paid the freight for the airlines. They usually do not have the luxury of booking weeks and months ahead like vacationers. This typically means they were paying higher prices anyway.

I would almost guarantee airlines would trade repeat business travelers for once a year leisure travelers all the time.


Title: Re: I must be missing something
Post by: gleek on June 22, 2008, 04:53:05 PM
I think you're looking at it wrong.  United isn't scrapping all fares save those with the minimum-stay requirement.  If staying 2 nights isn't in your cards, there's a higher fare you can buy from United that will suit your preferences.  I suspect they're banking on the majority of folks buying that higher-cost fare instead of extending the trip.

I guess my point was to just raise fares then and don't play games with minimum stays (and paying for checked luggage).

But at least they can still advertise a $400 fare that really is $800 once you dig into it.

They need to advertise the $400 fares to fill the empty seats when they need to, but they don't want the people who can afford to pay $800 (i.e. business customers) to take up all the $400 fares, leaving the leisure traveler to choose between paying 800 bones and staying home. Leisure travelers theoretically should have more flexibility in scheduling their travel.

You missed my point, it's not $400. It's $400 plus fees and taxes plus $ for checked luggage plus $ for 'oh, you want to come home tomorrow instead of Thursday' equals $800.

There are no such thing as "business fares" and "leisure fares". Just fares. When I traveled a lot for business anybody could buy the ticket at the price given by the airline. They didn't ask if it was for business or leisure. And we booked through travel agents and by ourselves.

And business travelers have always paid the freight for the airlines. They usually do not have the luxury of booking weeks and months ahead like vacationers. This typically means they were paying higher prices anyway.

I would almost guarantee airlines would trade repeat business travelers for once a year leisure travelers all the time.

I know they're not called "business fares" and "leisure fares", but placing the minimum stay/weekend restrictions on these so-called "economy" fares makes these tickets unattractive to business travelers who need more flexibility. These become fares for leisure travelers by default.

I remember when I had to travel occasionally for business about 15 years ago, the cheap-ass company I worked for would pay the extra per diem and hotel stay to have us stay Saturday night if the difference between economy and full-fare coach tickets warranted this. Of course, since we were salaried, they didn't give a *feces* how many days we were away from home. So, admittedly, sometimes the minimum stay restriction doesn't necessarily work as planned, but I understand the motivation.


Title: Re: I must be missing something
Post by: Clive on June 22, 2008, 05:17:33 PM
Did United state that they were not filling the gap with anything?  If two-day flight was $400 and proper-stayover was/is $400, perhaps they're just bumping two-day to $550 or so.  Same-day stays unchanged $800, in the example.


Title: Re: I must be missing something
Post by: Fuzzy on June 22, 2008, 07:33:29 PM

I know they're not called "business fares" and "leisure fares", but placing the minimum stay/weekend restrictions on these so-called "economy" fares makes these tickets unattractive to business travelers who need more flexibility. These become fares for leisure travelers by default.

I remember when I had to travel occasionally for business about 15 years ago, the cheap-ass company I worked for would pay the extra per diem and hotel stay to have us stay Saturday night if the difference between economy and full-fare coach tickets warranted this. Of course, since we were salaried, they didn't give a *feces* how many days we were away from home. So, admittedly, sometimes the minimum stay restriction doesn't necessarily work as planned, but I understand the motivation.

We must have worked for the same company. I remember for a while having to do Saturday stays.  [sm_disgust]



Title: Re: I must be missing something
Post by: Fuzzy on June 22, 2008, 07:34:37 PM
Did United state that they were not filling the gap with anything?  If two-day flight was $400 and proper-stayover was/is $400, perhaps they're just bumping two-day to $550 or so.  Same-day stays unchanged $800, in the example.

Good point. I don't know.