Re: NYTimes.com Article: The Anger of the Long-Distance Flier

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On Tuesday, September 23, 2003, at 07:40 PM, Mark Greenwood wrote:
> There is a cost associated with operating frequent flier programs, I
> believe
> the going rate is 3 to 4 cents a point and the carriers carry a
> liability
> for those points. Air Canada took the same step a couple of years ago.
>  They
> even went so far as to restrict the fares that one can upgrade from.
> If you
> have paid any of the three lowest fares on domestic or transborder
> routes,
> you can't upgrade.  Times have changed, you can't expect a First Class
> seat
> for the cheapest fare the airline offers.  It is only good business to
> tie
> the reward to the amount of revenue generated for the carrier.

What you say is correct, but remember to compare "revenue" with
"removing liabilities". Both have impact on the bottom line.  In other
words, I don't feel whiny about trying to obtain an F seat as a FF
upgrade from my cheap fare, or using FF miles entirely, because I'm
offering to reduce the liability on their balance sheet (the miles I
have accrued) in exchange for that seat.

If that flight leaves with a bunch of F seats empty because the airline
declined the opportunity to reduce its liability by redeeming miles
from cheap fare customers, too bad for them.

--
Michael C. Berch
mcb@xxxxxxxxxxxxxx

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