United Airlines Reduces Business Fares With Discounts Up To 40% Off Unrestricted, Refundable Coach F

NWAfr8dog

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As in: "We know we're going down the tubes, so lets take as many of the others with us as we can!"
 

KCFlyer

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[P]
[BLOCKQUOTE][BR]----------------[BR]On 1/6/2003 9:49:18 AM NWAfr8dog wrote:
[P]As in: "We know we're going down the tubes, so lets take as many of the others with us as we can!"[/P]----------------[/BLOCKQUOTE]
[P][/P]Wrong. It's as in "We recognize that the days of raping the business traveller to cover our losses incurred by competing with 21 day advance fare wars with NWA are over, and we intend to do something about it".
 

spacewaitress

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Aug 27, 2002
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On 1/6/2003 9:49:18 AM NWAfr8dog wrote:

As in: "We know we're going down the tubes, so lets take as many of the others with us as we can!"
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Hey, no one knows we're goin down the tubes...least of all us!!
 

mga707

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Aug 19, 2002
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[blockquote]
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On 1/6/2003 10:18:40 AM KCFlyer wrote:



[BLOCKQUOTE]
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On 1/6/2003 9:49:18 AM NWAfr8dog wrote:


As in: "We know we're going down the tubes, so lets take as many of the others with us as we can!"[/P]----------------[/BLOCKQUOTE]


[/P]Wrong. It's as in "We recognize that the days of raping the business traveller to cover our losses incurred by competing with 21 day advance fare wars with NWA are over, and we intend to do something about it".
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Agree. They're just taking a cue from America West's survival strategy. It seems to be working for HP (so far), so why not give it a try?
 

autofixer

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U management has already said that even with its reduced cost structure in CH 11, these fares will cause massive errosion in revenue. We will see if it is a last ditch effort by UAL to raise revenue or something else.

I personally do not care, because I am no longer in the industry,
 

Diversion

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[BLOCKQUOTE][BR]----------------[BR]On 1/6/2003 9:51:11 PM autofixer wrote:
[P]U management has already said that even with its reduced cost structure in CH 11, these fares will cause massive errosion in revenue. We will see if it is a last ditch effort by UAL to raise revenue or something else. [BR][BR]----------------[/P][/BLOCKQUOTE]
[P]I think it's a simple matter of [EM]trying [/EM]to hold on to market share. When an airline is in bankruptcy, passengers will tend to shy away from it, fearing their tickets may suddenly become worthless in the event the company closes it's doors. The other carriers will match the fares to remain competitive, so with which airline do you think passengers will tend to book their flights: the airline in bankruptcy or the competitor who is more likely to still be in business? [BR][BR]This will not help UAL's revenue situation. Costs can be slashed to the extreme, but if the revenue doesn't exceed costs, the end result is continued losses--simple as that.[BR][/P]
 

Busdrvr

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Aug 20, 2002
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On 1/6/2003 10:25:08 PM Diversion wrote:


The other carriers will match the fares to remain competitive, so with which airline do you think passengers will tend to book their flights: the airline in bankruptcy or the competitor who is more likely to still be in business?

This will not help UAL's revenue situation. Costs can be slashed to the extreme, but if the revenue doesn't exceed costs, the end result is continued losses--simple as that.
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PEOPLE BUY THE CHEAPEST TICKETS! Our FF have stayed with us for the most part because they KNOW they will be hooked up no matter what. If UAL went 7, AMR, NWA and DAL would literally be lined up to offer equivilent status AND full milage credit to all our FF's. These cheaper fares are a shot directly at FRNT and ATA. they've been poaching our two biggest hubs for a while now. the only defense is to hurt them. FRNT was bleeding cash BEFORE UAL's filing. Now UAL, on the back of significantly lower wage rates (you asked for it...) and lower lease rates (100K a month for a guppy, 350K for a whale) WILL be able to offer the flights cheaper. As for pax "booking away", yes, it happened for a while, but who would you rather fly on? A chap 11 airlines or one with a bunch of "chock eating", lightening fried guppies being flown against the better judgement of the companies own AMT's?
 

KCFlyer

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Busdriver - just an FYI - a rather large group of us are going from MCI to TPA in March. My brother in law and his family were going to try using a free ticket on UAL and buying their ticket on them. The travel agent mentioned that there was a chance that UAL would not be in business. They "booked away". Chapter 11 doesn't help your bookings, and I really wonder if AA,DAL, and NWA will be lining up to honor your "elite" passengers miles...the tickets they bought couldn't save UAL....why would they want to take on that kind of additional liability?
 

Tango-Bravo

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According to the article linked by the moderator, the new "business friendly" fares (roundtrip) given as examples are ORD-NYC $718; DEN-WAS $1,054; BOS-PDX $1,438. To these figures segment, security and airport facility taxes totalling $17-40 (depending on whether the routing is non-stop or via connection) need to be added. Plus possible fuel surchages? And these fares are non-refundable, use-it-or-lose-it, pay a $100 fine (plus possible fare increase) for confirmed changes (but same-day standby will be allowed at no charge!)

These fares would be far more attractive to business travelers were they not encumbered with the same penalties as loss-leader fares (except for the free! standby provision). As for the no-advance purchase and no minimum stay requirements of the new "business friendly" fares... well, business travelers have figured out how to beat UA (and the other network airlines) at their own game in regard to these "business unfriendly" restrictions, and with 7-day fares given in the same article for hundred$ less... don't see why they would change their habits.

Some questions that someone perhaps can answer...

Are the new "business friendly" fares announced by UA a move toward value pricing -- or will there continue to be 25-30 (or more) fares in the respective markets (with the same 10:1 disparity between highest and lowest coach fares)?

Will the "business friendly" fares actually be available on the days and times business travelers need to fly -- in sufficient numbers -- or will it be yet another bait-and-switch game where only a handful of seats are available at this fare on flights preferred by business travelers (while every seat on the plane is available at "business friendly" fares on days and times when business travel is virtually non-existent)?

These are posed as "devil's advocate" questions for which I have no preconceived answers. If the tone of my questions seems skeptical and/or cynical, it stems from observations of yield-management's demented pricing shenanigans made from my "ringside" seat at a full-service major. What's to make one believe they've changed their ways (that have had disastrous consequences for the major airlines) until we see true reform actually take place? If nothing else, I give credit to UA for finally acknowledging (at least implicitly) that their pricing model is broke and for making a first step toward fixing it.
 

Busdrvr

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[blockquote]
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On 1/7/2003 6:05:45 AM KCFlyer wrote:

"Busdriver - just an FYI - a rather large group of us are going from MCI to TPA in March. My brother in law and his family were going to try using a free ticket on UAL and buying their ticket on them. The travel agent mentioned that there was a chance that UAL would not be in business. They "booked away". Chapter 11 doesn't help your bookings,"

Like I said, there WAS some level of 'bookaways', that has deminished lately. It is ironic that folks will continue to buy tickets on an airline that averages one pilot error crash every two years, but are stupid enough to be afraid that they won't be covered in march if they buy a ticket on UAL.... There is no cure for stupidity.


"and I really wonder if AA,DAL, and NWA will be lining up to honor your "elite" passengers miles...the tickets they bought couldn't save UAL....why would they want to take on that kind of additional liability?"


Are you kidding?! 200,000 pax per day, and you don't think AMR, NWA and DAL wouldn't want them? Your assumption is beyond absurd.
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Busdrvr

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Aug 20, 2002
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"According to the article linked by the moderator, the new "business friendly" fares (roundtrip) given as examples are ORD-NYC $718; DEN-WAS $1,054; BOS-PDX $1,438. To these figures segment, security and airport facility taxes totalling $17-40 (depending on whether the routing is non-stop or via connection) need to be added. Plus possible fuel surchages? And these fares are non-refundable, use-it-or-lose-it, pay a $100 fine (plus possible fare increase) for confirmed changes (but same-day standby will be allowed at no charge!)"

I believe the new fares are the SECOND number printed, ie 359, 527 and 719 respectively. FYI, SWA and Blu print thier fares the same way, kind of like buying the latest gadget on TV for 19.95 but "shipping and handling" is 42.50. But in a "value" market, you must compare apples to apples.
 
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[blockquote]
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On 1/7/2003 2:26:41 PM N305AS wrote:


I think what the previous person meant was that AA, DL, CO and other carriers will more than likely give UA's Mileage Plus elite members equivalent status in their own programs should UA liquidate.



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UA's best customers are right now being lured by the competition. These clients are easy enough to identify.

Why would you think these competitors would wait for a liquidation? Besides, UA ain't going nowhere.
 

Tango-Bravo

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[blockquote]
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On 1/7/2003 11:45:37 AM Busdrvr wrote:

"According to the article linked by the moderator, the new "business friendly" fares (roundtrip) given as examples are ORD-NYC $718; DEN-WAS $1,054; BOS-PDX $1,438. To these figures segment, security and airport facility taxes totalling $17-40 (depending on whether the routing is non-stop or via connection) need to be added. Plus possible fuel surchages? And these fares are non-refundable, use-it-or-lose-it, pay a $100 fine (plus possible fare increase) for confirmed changes (but same-day standby will be allowed at no charge!)"

I believe the new fares are the SECOND number printed, ie 359, 527 and 719 respectively. FYI, SWA and Blu print thier fares the same way, kind of like buying the latest gadget on TV for 19.95 but "shipping and handling" is 42.50. But in a "value" market, you must compare apples to apples.


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You correctly note the "business friendly" fares given in the article, below which (in the article) is the notation "one way" -- in my post I doubled the figures given to represent roundtrip fares (which I duly indicated) -- before taxes that cannot be calculated until the routing is known. Yes, the manner in which all airlines advertise their loss-leader fares with the small-print disclaimer "each way based on roundtrip" is bait-and-switch nonsense inasmuch as the fares shown for the markets advertised do not exist -- on either a roundtrip basis (in which case the amount must be doubled) or a one-way basis (in that the fare shown cannot be purchased on a "stand alone" basis). At least the one-way "business friendly" fares introduced by UA actually can be purchased on a one-way basis at the fares shown -- plus $8.50 - 20.00 one-way taxes.