4 ms·

I prefer airlines that don't nickel and dime. In fact, I prefer to fly less since the experience has consistently deteriorated over decades. If you travel inter

by esafak 1y ago

I prefer airlines that don't nickel and dime. In fact, I prefer to fly less since the experience has consistently deteriorated over decades. If you travel internationally you get the added fun of dealing with border agents. And even they have discovered price discrimination, with their VIP lines. All told, is all this chicanery benefiting airlines?

ggm 1y ago
> All told, is all this chicanery benefiting airlines? I am pretty comfortable it contributes to revenue and profit outcomes the board likes.
- tonyedgecombe 1y ago
  It feels like competitive pressures in some markets drive away all the profits leaving corporations with no choice but to engage in underhand tactics. Car rentals and printer inks are a couple of examples of the same process leading to really shitty behaviour on the suppliers part.
  - ggm 1y ago
    I agree. Boards should be under more pressure to deliver longterm outcomes of benefit beyond their immediate board term, KPIs and rewards. Possibly the path out is to make some board renumeration tied to 5 and ten year success. These shitty LCC patterns make short term revenue and the long term consequence of market share moves don't get factored in.
nemomarx 1y ago
I think it's kinda race to the bottom / lemons market. A lot of people search for flights through aggregators so you need to optimize for the price shown there, and the customer doesn't know if that's the real price or if there'll be add ons so they won't go for a more expensive one on faith. Best bet is finding out which airline treats you best and going all the way to a loyalty card with them or something I guess? that seems to work out a little better
- bluGill 1y ago
  I've heard it said that airlines make all their money from interest payments on points. That is the credit card companies are buying miles today, and when the flight is taken the airline faces the charge in between that time they invest the money and collect the interest. I'm not sure if it is true, but it is an interesting insight even if not strictly true.
  - GeneralMayhem 1y ago
    It's not just time-value. It's also not just tying/advertising (although it is some of that - if I'm getting a ton of "free" points to American, I'm more likely to fly with them). It's both of those, and so much more. Loyalty points work like gift cards in that huge numbers of them go unredeemed for any value, so selling them is just printing money. And unlike gift cards, which are typically denominated in currency, airline points don't have a fixed exchange rate to USD, so the airline can sell them to Chase or whatever for $0.01, and then if it needs to rebalance the books to shed the outstanding liability it can easily adjust the point costs of flights to make them only worth $0.009 - it's the same as a price hike, but in a way that's less noticeable to most customers most of the time. And that's assuming they don't just sell the points at an outright profit to begin with. You can find a number of analyses showing that airlines operate at a loss if you set aside the miles-economy revenue streams. United famously got a line of credit secured against their loyalty program in 2020, in which they and their creditors valued the loyalty program at more than the value of the entire company of United Airlines - which would naively imply that the actual airline, the part of the company that owns large expensive machines and actually sells a product to consumers, had negative value. Here's a longer overview with numbers and sources - https://www.youtube.com/watch?v=ggUduBmvQ_4 https://www.youtube.com/watch?v=ggUduBmvQ_4
    - supertrope 1y ago
      Kind of like how GM's credit arm was briefly more profitable than the actual manufacturing.
      - 1y ago
onlyrealcuzzo 1y ago
It's made it so that relatively poor people can afford to regularly fly all over the world, which is a relatively new thing. Lowe middle income people in lower middle income countries can afford to fly somewhat regularly, and even internationally, too. Flying used to be just for the rich only as far back as the 60s, and for nobody as far back as 200 years...
- redczar 1y ago
  The vast majority of the world’s population can’t afford to fly. The relatively poor part of your comment is weird. Flying is still for the rich.
  - grugagag 1y ago
    Flying used to be for the ultra rich, people’d gather around them to listen to their plane ride story. The poor in this case are not the poorest but poor comparatively
  - onlyrealcuzzo 1y ago
    Okay, sure, if lower middle income people in China are rich. Even middle income people in India can afford flights...
- pasquinelli 1y ago
  > It's made it so that relatively poor people can afford to regularly fly all over the world, which is a relatively new thing. has _it_? do what is _it_ again? >> All told, is all this chicanery benefiting airlines? i'm really curious how screwing passengers has done these things.
  - daedrdev 1y ago
    Airlines are actually very low margin business. Thus, all these pricing tactics merely offset the drastically cheaper tickets. It makes sense, their margins are so low that they have to nickel and dime everything to make a small profit in good years and avoid going under next recession.
legitster 1y ago
> All told, is all this chicanery benefiting airlines? Yes. An example is paid baggage. It used to be that stowage space was mostly a waste of capacity on an airplane. But with the help of modern software making coordinating shipping easier, they can make lucrative money shipping cargo on passenger flights. So encouraging passengers to not bring bags and keeping that capacity for cargo is a feature, not a bug.
- FuriouslyAdrift 1y ago
  I always ship my baggage via insured carrier (Fedex, DHL, etc) and take a small carry on for immediate needs. It's MUCH cheaper and safer. Or I just don't bring anything that won't fit in my lap.
  - Kon-Peki 1y ago
    FedEx'ing baggage between home and a distant hotel is awesome. I haven't done it recently, so maybe with airline fees it is always cheaper. It used to be that you had to have a corporate account with enough discounts to make it cheaper than checked luggage. Big hotels host lots of conferences, legal depositions, business shows, etc. They get a FedEx truck almost daily and don't blink if a package arrives addressed to you with "Guest checking in on XXXX date" appended to it. It happens all the time! And when you leave, you call the front desk and ask them to take a box to the loading dock for the next FedEx truck.
  - legitster 1y ago
    Alternatively, my brother has done a lot of business travel in his life, and I love the advice he gave me: "Never pack more than you are willing to carry a mile down a gravel road in the rain" I have yet to regret a trip where I pack extremely light.
    - thehappypm 1y ago
      When I travel, I often stay in rentals that have laundry machines, because it’s so much easier just to pack light and do laundry every couple of days. I’m also not against packing light with the intention of going shopping if I need something. That’s how I get a lot of fun clothes!
rufus_foreman 1y ago
>> All told, is all this chicanery benefiting airlines? No. There is no competitive advantage. If they don't implement price discrimination, they go bankrupt. If they do implement price discrimination, they still go bankrupt: https://en.wikipedia.org/wiki/List_of_airline_bankruptcies_in_the_United_States https://en.wikipedia.org/wiki/List_of_airline_bankruptcies_i....
ilamont 1y ago
> I prefer to fly less since the experience has consistently deteriorated over decades. I never liked flying, but was able to put up with it better when I was younger. Nowadays, I get some satisfaction by leveraging credit card points through my business to get "free" tickets. I mentally steel myself to the unpleasantness of the airport, boarding, and flying, and try to get as much work done on my laptop as possible when I am sitting down so at least I can feel that I accomplished something by the time I reach my destination.
dkjaudyeqooe 1y ago
> If you travel internationally you get the added fun of dealing with border agents That's avoidable. If you are a citizen of an advanced economy flying to another you can just use the automatic passport gates.

by esafak 1y ago

ggm 1y ago

> All told, is all this chicanery benefiting airlines? I am pretty comfortable it contributes to revenue and profit outcomes the board likes.

tonyedgecombe 1y ago
It feels like competitive pressures in some markets drive away all the profits leaving corporations with no choice but to engage in underhand tactics. Car rentals and printer inks are a couple of examples of the same process leading to really shitty behaviour on the suppliers part.
- ggm 1y ago
  I agree. Boards should be under more pressure to deliver longterm outcomes of benefit beyond their immediate board term, KPIs and rewards. Possibly the path out is to make some board renumeration tied to 5 and ten year success. These shitty LCC patterns make short term revenue and the long term consequence of market share moves don't get factored in.

nemomarx 1y ago

I think it's kinda race to the bottom / lemons market. A lot of people search for flights through aggregators so you need to optimize for the price shown there, and the customer doesn't know if that's the real price or if there'll be add ons so they won't go for a more expensive one on faith. Best bet is finding out which airline treats you best and going all the way to a loyalty card with them or something I guess? that seems to work out a little better

bluGill 1y ago
I've heard it said that airlines make all their money from interest payments on points. That is the credit card companies are buying miles today, and when the flight is taken the airline faces the charge in between that time they invest the money and collect the interest. I'm not sure if it is true, but it is an interesting insight even if not strictly true.
- GeneralMayhem 1y ago
  It's not just time-value. It's also not just tying/advertising (although it is some of that - if I'm getting a ton of "free" points to American, I'm more likely to fly with them). It's both of those, and so much more. Loyalty points work like gift cards in that huge numbers of them go unredeemed for any value, so selling them is just printing money. And unlike gift cards, which are typically denominated in currency, airline points don't have a fixed exchange rate to USD, so the airline can sell them to Chase or whatever for $0.01, and then if it needs to rebalance the books to shed the outstanding liability it can easily adjust the point costs of flights to make them only worth $0.009 - it's the same as a price hike, but in a way that's less noticeable to most customers most of the time. And that's assuming they don't just sell the points at an outright profit to begin with. You can find a number of analyses showing that airlines operate at a loss if you set aside the miles-economy revenue streams. United famously got a line of credit secured against their loyalty program in 2020, in which they and their creditors valued the loyalty program at more than the value of the entire company of United Airlines - which would naively imply that the actual airline, the part of the company that owns large expensive machines and actually sells a product to consumers, had negative value. Here's a longer overview with numbers and sources - https://www.youtube.com/watch?v=ggUduBmvQ_4 https://www.youtube.com/watch?v=ggUduBmvQ_4
  - supertrope 1y ago
    Kind of like how GM's credit arm was briefly more profitable than the actual manufacturing.
    - 1y ago

onlyrealcuzzo 1y ago

It's made it so that relatively poor people can afford to regularly fly all over the world, which is a relatively new thing. Lowe middle income people in lower middle income countries can afford to fly somewhat regularly, and even internationally, too. Flying used to be just for the rich only as far back as the 60s, and for nobody as far back as 200 years...

redczar 1y ago
The vast majority of the world’s population can’t afford to fly. The relatively poor part of your comment is weird. Flying is still for the rich.
- grugagag 1y ago
  Flying used to be for the ultra rich, people’d gather around them to listen to their plane ride story. The poor in this case are not the poorest but poor comparatively
- onlyrealcuzzo 1y ago
  Okay, sure, if lower middle income people in China are rich. Even middle income people in India can afford flights...
pasquinelli 1y ago
> It's made it so that relatively poor people can afford to regularly fly all over the world, which is a relatively new thing. has _it_? do what is _it_ again? >> All told, is all this chicanery benefiting airlines? i'm really curious how screwing passengers has done these things.
- daedrdev 1y ago
  Airlines are actually very low margin business. Thus, all these pricing tactics merely offset the drastically cheaper tickets. It makes sense, their margins are so low that they have to nickel and dime everything to make a small profit in good years and avoid going under next recession.

legitster 1y ago

> All told, is all this chicanery benefiting airlines? Yes. An example is paid baggage. It used to be that stowage space was mostly a waste of capacity on an airplane. But with the help of modern software making coordinating shipping easier, they can make lucrative money shipping cargo on passenger flights. So encouraging passengers to not bring bags and keeping that capacity for cargo is a feature, not a bug.

FuriouslyAdrift 1y ago
I always ship my baggage via insured carrier (Fedex, DHL, etc) and take a small carry on for immediate needs. It's MUCH cheaper and safer. Or I just don't bring anything that won't fit in my lap.
- Kon-Peki 1y ago
  FedEx'ing baggage between home and a distant hotel is awesome. I haven't done it recently, so maybe with airline fees it is always cheaper. It used to be that you had to have a corporate account with enough discounts to make it cheaper than checked luggage. Big hotels host lots of conferences, legal depositions, business shows, etc. They get a FedEx truck almost daily and don't blink if a package arrives addressed to you with "Guest checking in on XXXX date" appended to it. It happens all the time! And when you leave, you call the front desk and ask them to take a box to the loading dock for the next FedEx truck.
- legitster 1y ago
  Alternatively, my brother has done a lot of business travel in his life, and I love the advice he gave me: "Never pack more than you are willing to carry a mile down a gravel road in the rain" I have yet to regret a trip where I pack extremely light.
  - thehappypm 1y ago
    When I travel, I often stay in rentals that have laundry machines, because it’s so much easier just to pack light and do laundry every couple of days. I’m also not against packing light with the intention of going shopping if I need something. That’s how I get a lot of fun clothes!

rufus_foreman 1y ago

>> All told, is all this chicanery benefiting airlines? No. There is no competitive advantage. If they don't implement price discrimination, they go bankrupt. If they do implement price discrimination, they still go bankrupt: https://en.wikipedia.org/wiki/List_of_airline_bankruptcies_in_the_United_States https://en.wikipedia.org/wiki/List_of_airline_bankruptcies_i....

ilamont 1y ago

> I prefer to fly less since the experience has consistently deteriorated over decades. I never liked flying, but was able to put up with it better when I was younger. Nowadays, I get some satisfaction by leveraging credit card points through my business to get "free" tickets. I mentally steel myself to the unpleasantness of the airport, boarding, and flying, and try to get as much work done on my laptop as possible when I am sitting down so at least I can feel that I accomplished something by the time I reach my destination.

dkjaudyeqooe 1y ago

> If you travel internationally you get the added fun of dealing with border agents That's avoidable. If you are a citizen of an advanced economy flying to another you can just use the automatic passport gates.