Fares...hmmmm?

[RowUnderDCA]

My favorite U market is not advertised as a GoFare. However, I have noticed some changes. Most notably the 14-day advanced purchase (no saturday night stay requirement) is the lowest fare offered on the website. It's a pretty low fare ($240) r/t for a 2.5 hour flight. Maybe that's not exactly a GoFare, but it's a reasonable fare. (Now that I think about it, the fare might be influenced by the Sept drop off in travel)

I can't imagine why many would need the other, higher fares in the list, considering that 14-day advanced purchase no Saturday stay is pretty accomodative.

So, isn't that fare rationalization?

 

[sfb]

My favorite U market is not advertised as a GoFare. However, I have noticed some changes. Most notably the 14-day advanced purchase (no saturday night stay requirement) is the lowest fare offered on the website. It's a pretty low fare ($240) r/t for a 2.5 hour flight. Maybe that's not exactly a GoFare, but it's a reasonable fare. (Now that I think about it, the fare might be influenced by the Sept drop off in travel)

I can't imagine why many would need the other, higher fares in the list, considering that 14-day advanced purchase no Saturday stay is pretty accomodative.

So, isn't that fare rationalization?

[post="169679"][/post]​

Well, this is just my opinion, but fare rationalization isn't just offering reasonable advance purchase fares with fewer restrictions than in the past. From your description, it sounds like the stage length of the flight is in the range of 1000 miles, so $120 each way works out to about 12 cents/mile, which is where the lowest fare ought to be (and not at some crazy amount like $50 each way). But fare rationalization also applies to the highest fares offered as well -- so that your best customers don't feel cheated when they have to be somewhere ASAP and pay a walk-up fare. The walk-up fare ought to be, at most, 2 to 2.5 times the advance purchase fare, or in this case, in the range of $240-300. And offer a first-class fare that's a modest premium above full-fare coach -- say, $100 -- so people will actually pay for a first class seat.

The point is not to simply remodel the fare structure for the bargain hunters, but to remodel it for everyone! There are "business" travelers flying on "leisure" fares because the "business" fares are so ridiculously high. Give them a refundable/walk-up fare that is reasonable and they'll probably pay a modest premium for the flexibility. This is why Southwest sells 30-40% of their seats at their "walk-up" fares.

 

[RowUnderDCA]

Well, I see you've got a point... the highest fare listed is $958 for a 1000 mile roundtrip. Also, I note that the low fare does not appear to have onerouse time-of-day restrictions.

 

[whlinder]

What market is this?

Without knowing the market, its possible that US has matched another competitor's fare, and it just happens to be the lowest out there right now.

Now if US is quietly eliminating Sat. night stays from fares and replacing them with 1-day stays, that is a step towards fare rationalization. Alaska did this, as when they announced their new fare structure, they mentioned how pieces of it had already been in place for a few weeks. A carrier the size of US can't revamp the entire thing over night, there are too many fares and fare rules to revise. So perhaps this is the first step toward an AS/HP structure. SFB's description of fare rationalization is basically AS's new structure. I think in virtually all cases, (I know for sure on the transcons), AS's F fare is exactly $100 above their Y fare (one-way).

Is $240 inclusive of all taxes and fees, or the first fare listed on the search by price feature of the website (which wuold include the 7.5% excise tax but not some of the other additional taxes)? If it is the one listed on the search by price feature, the real base fare that US gets is around $224, pushing the yield on that fare (assume 1000 mile flight) down to 11 cents or so. And while that is certainly reasonable, its not going to pay the bills if there are empty seats. Some higher fares need to be sold as well to make it profitable.

-whlinder, who used to row under DCA....