How airlines loose passengers (1)
Let's suppose there is an airline that for 4 years or more has been able to successfully fly a good route over a medium to long distance of say 6 -7 hours duration. Let's say the cost has always been around $1200 Business Class Return give or take $150 or so dependant on the season. Let's also suppose that the airline has a good safety record, good punctuality, and a satisfactory if not quite excellent in-flight service. Let us also suppose that the Business Class section is almost always 90 % full.
How does the airline keep its loyal Business Passengers if suddenly, it raises the price of the Business Class flight from $1200 to $1800?
How does the same airline keep its loyal Business Passengers if a competitor, with the same good safety record, similar punctuality record and an excellent in flight service can carry the same Business Class Passengers flying the same route can charge only $1050?
Surely one of them is going to lose money as passengers desert it to the cheaper carrier or the other carrier is already loosing money hand over fist by not charging enough?
Any answers?
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