Airlines were embarrassed over a pricing strategy to charge passengers traveling alone more than passengers traveling together. When called out on it, they quickly ended the practice.
- Airlines believe passengers traveling together are leisure travelers and likely price-sensitive. They want to fill seats with cheap fares, but don’t want to sell tickets for less than someone is willing to pay. And a business traveler is likely to pay more.
- It’s a crude way to separate business travelers from leisure travelers. But they don’t have the tools they used to have like Saturday night stays and 14- or 21-day advance purchase requirements to get the least expensive fares. It’s another tool like Basic Economy that’s taken their place.
The way they ended the requirement that there be at least two passengers on a reservation to qualify for the cheapest fares on some routes is to remove those fares which contained the requirement. That meant, for the moment, that the cheapest fares were just gone and anyone making a ticket purchase would pay the higher solo traveler rate.
One Mile at a Time sees that as a bad thing.
I wouldn’t consider airlines pulling cheaper fares for those traveling as a group of two or more to be something to celebrate, since now everyone pays more, and I think it’s important that we call out the current reality.
The thing to understand here is that the quickest way to get rid of fares that require two passengers is to get rid of fares that require two passengers to be eligible! So the airlines did that right away. ‘Hey, you caught us! We aren’t doing that anymore!’
But airlines still need to fill seats, and need to lower fares in order to do it. The cheapest fares that required two passengers were there for a reason. And airlines that lower their prices will attract price-sensitive marginal consumers. There’s still downward pricing pressure when there are empty seats. Pricing will adjust.
Maybe airlines will bring back this sort of pricing as well, once the heat dies down and everyone becomes used to it. Or maybe it won’t – this wasn’t being used in all markets. It was one technique among many that airlines use to get as close as possible to personalized pricing, where they charge each customer the most they possibly can without chasing that customer away.
In fact, a source points out that American hasn’t actually dropped all of its multi-passenger fares, while United and Delta have, “American definitely initiated all of this so Im sure UA and DL are fuming about catching blame.” And JonNYC points out that American’s Saturday night stay requirements on a roundtrip are back in some cases for the cheapest fares.
At the same time, if we see the end of this pricing practice that doesn’t mean overall airfare prices will be lower! There’s a certain price needed to fill seats, and the tools to get there change but it’s… the same price. Maybe couples will pay more than they would have and singles a little less, but framing it this way isn’t quite correct. It’s better to look at overall airfare levels rather than getting into counterfactuals about traveler characteristics that are no longer in use in fare rules. And those airfare levels are likely to be similar to what we saw before.
The airlines are going to mess around with these discriminator’y pricing schedules and they are going to find themselves back under federal regulation.
@Claude and @Gary, I love how multi-person discounts are considered discriminatory for airlines, but no one questions it when they buy tickets to an event or order food at a restaurant.
Discounts are discounts, regardless of how they appear. Consumers should better understand how this benefits them, instead of being indignant at schemes designed to encourage sales. Be consistent in the application of your anger or just hold your tongue rather than confirm your hypocrisy.
When called out for charging two different prices, the airlines remove the lower price — who could have seen that coming???
When I was a kid, paying less per item for two or more of that item was called a “volume discount”. It wasn’t outrageous then, and I see no reason to be outraged by it now.
But are they still charging different people different prices for the same seat — even when purchasing at the same time for the same flight — based on algorithms that tell them how much they predict specific individuals will pay given past behavior?
I find that practice much more offensive.
We need a Black, lesbian, businesswoman to find out the White male college kid next to her paid less for the same seat. And then go viral with calling the airline bigots.
No one’s embarrassed, they just pull these on the weekend when business travelers aren’t typically booking anyway.
Thing1 well given that the minority person you describe probably lives in the Bay Area, Portland, LA or Seattle, they are completely entitled to charge more based on geographic location.
What airlines are embarrassed? nonsense.They are just a bunch of vicious revenue whores
These thieving low life creeps show us who they are with married segments charging severely higher mileage amounts for the same international flight simply leaving out of one city over another.Another way to deny their one world partners access to their inventory
These airlines would strip their own family naked and throw them to the street for an extra dollar.Nothing will stop them from being dishonest
When the shoes are reversed they cry fraud and close your account
It is hard to believe that somebody didn’t realize they would quickly get caught. It seems that big businesses and governments often have people with little sense of history and an entitled view. They are sure that even if they are doing something questionable, “This time it will be different.” It never is.
@roundtree. In economics, charging different categories of customers different prices is called price discrimination. It has no negative connection; it is purely a description. Senior discounts, quantity discounts, and the like are all forms of price discrimination. It’s just some hear “discrimination,” and think of the atrocious things like racial/ethnic/religious discrimination. And, of course, airlines have and will price discriminate (in a post deregulation world) based on when you buy, how long you stay, r/t vs. o/w, etc.
I noticed the price increase for many fares (several domestic and international itineraries) I had been tracking—for two persons—over the next 8 months. Between Thursday and Saturday they went up 30% I’ll just wait things out while the computers are reprogrammed.
“It seems that big businesses and governments … are sure that even if they are doing something questionable, “This time it will be different.” It never is.”
Ah what now? Wish this was true in our current era of Idiocracy.
“@Claude and @Gary, I love how multi-person discounts are considered discriminatory for airlines, but no one questions it when they buy tickets to an event or order food at a restaurant.”
I’ve never seen a discount for having more than one person at a restaurant table or for buying more than one ticket for an event (except in cases where the group attending an event was large enough to qualify for group sales, which is usually an order of magnitude more than 2).
Someday, there may be incentives to allow more tracking by airlines. For example, more frequent flyer miles if you enter your number before searching fares. However, if you do, AI will search your computer to determine if the trip is business and display fares accordingly. Owwww
Couples fares should be higher. Couples don’t want to sit apart so they pay for seating assignments. I know. I have paid in Canada where they do this.
Why don’t they use Sat night stays anymore or 14 or 21 day advance purchase?
Why “caught” and “embarrassed”? They can charge whatever they want and there’s always been companion fares.
The lower per seat cost for two sounded like a two for one deal so I didn’t really have a problem with it. The idea wasn’t to fill the second seat but to sell the first seat and having a second seat at a discounted rate helped push some of those sales. It would have been nice if the deal had been extended to having an extra seat for comfort, also.
Cruising never looked better as airlines continue to pull tacky tricks.
@R T nNo one pays for a seat at a table in a restaurant. They pay for the food. And I’ve been to plenty of restaurants that had two for one specials, or 50% off the second entree. It’s very common to offer volume discounts on meals.
If we called it market segmenting instead of price discrimination, people would understand it more.
@LAX Tom And, a pizza large enough for two to share costs less than 2 one-person pizzas. And, “kids eat free” is not uncommon.
One person in a group on a cruise, you always pay more per person than if your cabin was inhabited by 2 persons. Same thing? Idk. But certainly not worthy of federal intervention.
Good riddance. As hateful as round-trip pricing.
And no, they were not “cheap fares”. Airlines were not going to be lowering their revenues
That’s ridiculous to charge a solo passenger more. I’m retired and living on SS. I always travel by myself. I have no family and I am usually flying to visit friends. I travel once every couple years because that is all I can afford at the rates that are being charged. A business traveler is not looking for a two week trip. Usually, it’s a few days or even one day. Just offer a fare price to all. I do not understand why people are paying different prices for the same section/seat. If we are buying a ticket for a plane trip, we have to have a seat and charging different rates just to have a seat ticked me off from the beginning when Spirit started that practice and I have flown on their airline since.
I can only assume the people saying that multi-person discounts in restaurants are common must eat in very different restaurants to me – I have never encountered this.
As for @Pilot93434, there is a difference between a cruise ship cabin and a seat on a plane. On a ship you get sole use of a 2-person cabin, so it’s logical to pay more. On a plane if you’re solo you aren’t guaranteed twice as much space.
If the airlines were just a little less a pack of rapacious weasels then they could have been celebrated for this if they had publicly announced a GREAT new 2 For Summer (or whatever) sale where you and your bff/spouse/etc could fly for a great sale price. Sure, some Karen would have found something to complain about in the deal but it would have been fine for most people. Instead the perpetual secrecy and customer-unfriendly mentalities of the domestic airline industry turned this into a PR fiasco.
@Andy – maybe you dine exclusively in fine restaurants, which is okay. But downstream restaurant chains and fast food places frequently offer volume discounts. There’s even an acronym for it – BOGO – that is used frequently in food service and most other retail operations. @Dave W. brought up the example of a large pizza that can feed two people costing less than two individual pizzas. You pay less per ounce for a large box of laundry detergent than you do for a small box. And on and on.
It’s literally depressing to me to read these comments. The ignorance is astounding.
Imagine comparing air transportation purchases to food purchases.
@Cyndi Strawser – you’re the source of my depression, that you think there IS a difference between an airline ticket and a cheeseburger, at least when it comes to setting the price. Literally EVERYTHING can or has been sold at a discount based on volume, from eyeglass frames to software licenses to cheesesteaks. If you ride the subway in NYC more than 10 times within a seven day period, the rest of your rides are free for the remainder of that period. It’s all commerce, Cyndi, it doesn’t matter what you’re selling.