Nyc-aus
- Thread starter LongIsland2004
- Start date
AgentOrange
Member
- Apr 19, 2004
- 31
- 0
Well, if US Airways finds just one corporate employee whose company/business is located in Manhattan and would therefore never consider ISP and whose company is willing to shell out $1100 (price is not every company's highest consideration, in fact, it usually is not the first one), then we have an airline who wins out by going out on the supply/demand curve.
ELP_WN_Psgr
Senior
- Nov 29, 2003
- 419
- 0
Agent Orange writes in, "Well, if US Airways finds just one corporate employee whose company/business is located in Manhattan and would therefore never consider ISP and whose company is willing to shell out $1100 (price is not every company's highest consideration, in fact, it usually is not the first one), then we have an airline who wins out by going out on the supply/demand curve."
You may not realize it but you have just defined the problem.
USAirways et al may find one corporate employee willing to cough up an ungodly amount of money for a plane ticket, but not many more than just one.
For every $1100 full fare ticket they sell they are having to give away umpteen $99 seats to maintain those load factors.
The math is simple, albeit it looks complex:
[ (1 x 1100) + (unpteen x 99) ] / (umpteen plus one) = crappy yield
(crappy yield x RPMs) / (nasty ASM cost x ASMs) = loss and road to oblivion
Yeah, there are some folks in Manhattan or downtown DC who will just hop on go and let the boss pay for their plane far, regardless of the cost.
There aren't enough of those passengers to pay the freight any more.
A simpler fare structure is necessary and long overdue.
For every $99 transcon WN sells they sell a basketload of $92 tickets Dallas to Houston or $ 141 tickets Dallas to El Paso or $ 97 tickets Oakland to LAX.
Those are flights in the 250 mi to 600 mile range. A flight of similar length gets you a $450 walk up fare, or worse, on USAirways.
Passengers respond to value and fair treatment. If the walk up fare doesn't cause the traveler to immediately succumb to a case of the vapors, he or she is much more apt to buy a full fare ticket. The more of them you sell, the better off you are. If you price your full fare walk up tickets so high to where nobody buys any, what have you gained.
Of course, folks have been preaching this for some time, and nobody at the top is listening. HP adopted something similar to this, and has pretty much quit hemorrhaging money....might even make some from time to time. Hmmmmm.
You may not realize it but you have just defined the problem.
USAirways et al may find one corporate employee willing to cough up an ungodly amount of money for a plane ticket, but not many more than just one.
For every $1100 full fare ticket they sell they are having to give away umpteen $99 seats to maintain those load factors.
The math is simple, albeit it looks complex:
[ (1 x 1100) + (unpteen x 99) ] / (umpteen plus one) = crappy yield
(crappy yield x RPMs) / (nasty ASM cost x ASMs) = loss and road to oblivion
Yeah, there are some folks in Manhattan or downtown DC who will just hop on go and let the boss pay for their plane far, regardless of the cost.
There aren't enough of those passengers to pay the freight any more.
A simpler fare structure is necessary and long overdue.
For every $99 transcon WN sells they sell a basketload of $92 tickets Dallas to Houston or $ 141 tickets Dallas to El Paso or $ 97 tickets Oakland to LAX.
Those are flights in the 250 mi to 600 mile range. A flight of similar length gets you a $450 walk up fare, or worse, on USAirways.
Passengers respond to value and fair treatment. If the walk up fare doesn't cause the traveler to immediately succumb to a case of the vapors, he or she is much more apt to buy a full fare ticket. The more of them you sell, the better off you are. If you price your full fare walk up tickets so high to where nobody buys any, what have you gained.
Of course, folks have been preaching this for some time, and nobody at the top is listening. HP adopted something similar to this, and has pretty much quit hemorrhaging money....might even make some from time to time. Hmmmmm.
ClueByFour
Veteran
- Aug 20, 2002
- 3,566
- 37
That strategy worked like a charm at BWI. Currently works at PIT.AgentOrange said:
When does B6 start ops at LGA?
If you had used Expedia.com instead of USAirways' crummy web site, you could have found US flights for $631. If you're going to do comparison shopping, you need to use the right tools.LongIsland2004 said:
While ISP is close to LGA, you should have looked at all carriers out of ISP, not just WN. Delta is matching Southwest's fare of $586 ISP-AUS. US is not, although I don't know if they are not matching the fare or if the inventory is gone.
