Greedy Airlines & SlimLine Seats!
The B787 was designed for a 2-4-2 seating configuration but IIRC there are only two airlines, All Nippon and Air Canada which ordered it like this, everyone else went 3-3-3. I flew one eight hour flight in 9 across economy, luckily the aircraft was half empty and I got a full row of seats but it still felt cramped.
The return flight was on an A350 which was a pleasure even though the cabin was almost full. This is now my aircraft of choice, ahead of the A380.
The return flight was on an A350 which was a pleasure even though the cabin was almost full. This is now my aircraft of choice, ahead of the A380.
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Happy to see this thread take off, and yes this is a topic we all want to talk about. Whether you agree with me or not that the airlines are greedy, we all seem to agree that economy class has become very uncomfortable. But lets break it down. If any of you out there are professionals and can put in some $numbers, please do.
We will use United Airlines as our example...
777-300 ER
lowest possible price quoted
One way EWR-NRT
keep in mind this is a 3-3-3 setup, so not as greedy
108 Economy seats at $500 each = $54,000
114 Eco-Plus seat, (no price) $1000 each = $114,000
20 Business seats at $1889 each = $37,780
20 1st Class seats at $1889 each = $37,780
total profit if plane is full
$240,000
% paid by Eco/Plus = 70%
1.Anyone know how much it costs to run this flight?
2.Shouldn't economy class get better treatment based on the % they pay for the flight?
3.Why not make it 2 classes, Middle Class and Rich Class, get rid of Business and Eco Plus. Make Middle class comfortable and charge a fair price. Make Rich class ridiculous and charge a fortune.
These other classes are ploys... Economy plus only exists because Economy Class is so awful. Ditto business class....
Thats the new business model ... tell me what you think ...
We can have a security guard between the 2 classes with a velvet rope
We will use United Airlines as our example...
777-300 ER
lowest possible price quoted
One way EWR-NRT
keep in mind this is a 3-3-3 setup, so not as greedy
108 Economy seats at $500 each = $54,000
114 Eco-Plus seat, (no price) $1000 each = $114,000
20 Business seats at $1889 each = $37,780
20 1st Class seats at $1889 each = $37,780
total profit if plane is full
$240,000
% paid by Eco/Plus = 70%
1.Anyone know how much it costs to run this flight?
2.Shouldn't economy class get better treatment based on the % they pay for the flight?
3.Why not make it 2 classes, Middle Class and Rich Class, get rid of Business and Eco Plus. Make Middle class comfortable and charge a fair price. Make Rich class ridiculous and charge a fortune.
These other classes are ploys... Economy plus only exists because Economy Class is so awful. Ditto business class....
Thats the new business model ... tell me what you think ...
We can have a security guard between the 2 classes with a velvet rope
Paxing All Over The World
Eeeer, it's not $240,000 'profit' but Gross Income. You will never find out what it costs to operate the sector. Part of that is that each sector has to carry not just the cost of it's own operation but a percentage of the overall cost of running an airline. (Think about insurance for a moment)
Further, they have to allow for the cost of flights that do not run with high loads. They are looking at operations across the whole year. Since each flight is priced to maximise it's income (naturally) they could operate ten sectors in 2016 and the same ten sectors (with the same aricraft and identical loads) in 2017 and make less money.
Further, they have to allow for the cost of flights that do not run with high loads. They are looking at operations across the whole year. Since each flight is priced to maximise it's income (naturally) they could operate ten sectors in 2016 and the same ten sectors (with the same aricraft and identical loads) in 2017 and make less money.
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oh yeah, sorry gross 
point is, they are making money, and making it on the backs of the economy cabin. The legacy carriers should never have gotten into the cheap seat business, thats the greedy part.
But there has to be an average cost for 1 long haul flight. It cant be that much of a mystery...
point is, they are making money, and making it on the backs of the economy cabin. The legacy carriers should never have gotten into the cheap seat business, thats the greedy part.
But there has to be an average cost for 1 long haul flight. It cant be that much of a mystery...
Paxing All Over The World
The airlines charge what the market will bear - just like every other commodity. Sometimes, house prices go down and someone loses and someone gets a good deal - when the scales tip the other way someone loses and someone gets a good dea.
I do not like cramped seats and narrow aisles anymore than the next person and I choose whether to fly or not - just like every other commodity.
I do not like cramped seats and narrow aisles anymore than the next person and I choose whether to fly or not - just like every other commodity.
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On the 777 UA uses on EWR NRT the configuration is 8F, 40J, 113Y+, 108Y. They don't have a Y+ fare per se, but any Y passenger can pay a flat amount to upgrade.
Unlikely that every seat is filled on ever date. More likely 85-95% of Y; 75-85% of Y+; 60-70% of J and 50-60% of F. (These are guesses I have no knowledge of what they actually are)
As a network airline many of UA's customers are connecting onto and off of this flight. As fares are not set sector by sector you need to assume a 20-45% (sometimes more) dilution from prorate costs. (i.e. A passenger travelling from Washington to Singapore could travel IAD-EWR-NRT-SIN. Fares for that journey could be Y/486, J/1890, F/7078 which would have to be prorated over the three sectors. The EWR-NRT flight is about 65% of the total journey giving it Y/316, J/1228, F/4600 from the ticket price before deducting taxes.) ...
Now Children and Infants (and Ship's Crews, Staff, Travel Agents, etc.) get discounts ..
Estimating an airline's total revenue for flight is not easy and is prone to error. In fact the airlines rarely try and track revenue per individual flight. You have likely overstated the potential revenue by a significant amount, and the proportions are likely wrong as well.
And don't forget that this aircraft type will burn something like 8,100kg per hour for a 14 hour flight. Refinery fuel costs are around $429 per metric tonne, airlines probably pay 10% more so the fuel bill alone more than likely eats up all of the Y/Y+ revenue. They you add in the other costs ...
Damn greedy airlines
Unlikely that every seat is filled on ever date. More likely 85-95% of Y; 75-85% of Y+; 60-70% of J and 50-60% of F. (These are guesses I have no knowledge of what they actually are)
As a network airline many of UA's customers are connecting onto and off of this flight. As fares are not set sector by sector you need to assume a 20-45% (sometimes more) dilution from prorate costs. (i.e. A passenger travelling from Washington to Singapore could travel IAD-EWR-NRT-SIN. Fares for that journey could be Y/486, J/1890, F/7078 which would have to be prorated over the three sectors. The EWR-NRT flight is about 65% of the total journey giving it Y/316, J/1228, F/4600 from the ticket price before deducting taxes.) ...
Now Children and Infants (and Ship's Crews, Staff, Travel Agents, etc.) get discounts ..
Estimating an airline's total revenue for flight is not easy and is prone to error. In fact the airlines rarely try and track revenue per individual flight. You have likely overstated the potential revenue by a significant amount, and the proportions are likely wrong as well.
And don't forget that this aircraft type will burn something like 8,100kg per hour for a 14 hour flight. Refinery fuel costs are around $429 per metric tonne, airlines probably pay 10% more so the fuel bill alone more than likely eats up all of the Y/Y+ revenue. They you add in the other costs ...
Damn greedy airlines
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Anyway, old story. Woodclass makes the flight happen and J and F make the sugarcoating(still need to pay off salaries, aircraft lease, insurance, company infrastructure,+++ from that money remaining after removing fuel costs).
Branson said it once right - how to make a small fortune with airline business? Easy - start with a big fortune.... ;-)
Branson said it once right - how to make a small fortune with airline business? Easy - start with a big fortune.... ;-)
chefrp
I suspect that if you asked a dozen accountants what a flight costs you would get at least two dozen replies. Different airlines will account for costs differently and make different decisions.
You have the direct costs (fuel, crew, landing fees, etc) but also overheads (running the head office, etc). You can always look up an airlines accounts and divide the total costs by the available seat km which gives cost per available km. Costs such as handling may be a bit higher for longer distance flights but certainly don't rise in line with stage length so longer flights should have a lower cost/ASKm. The other approach, as suggested, is calculate the fuel cost per sector (hours x tonnes/hr x cost/tonne) and divide this by the proportion of costs accounted for by fuel. This approach would work if fuel costs were stable (of course they never are).
If you look at airline seat plans long haul J class seats may occupy three times the floor space as Y. However the load factor will be lower. Take this into account and you would expect to pay four times as much. I don't know how catering costs differ between the two or indeed total passenger service costs including lounges, etc.
I suspect that the average yield for J compared with Y is more than 4 times as much on some routes although it will obvious vary by time of year. A few years ago I read that all the profit on the North Atlantic came from premium traffic and that Y made a loss (although again this will vary by airline, route, time of year, etc).
One of the reasons for the growth in premium economy is the huge gulf between J & Y. I have read that its profitability is closer to that of J than Y, its good for the bottom line. Looking at fares it seems that many travellers are willing to pay a high premium.
Its interesting that BA are reconfiguring some of their 747s increasing J and reducing Y. They obviously think that the money is in J.
It would be interesting to know how much it would cost to reduce density and if people would pay. Airlines claim that punters won't pay extra, although that may depend upon how tall one is.
I suspect that if you asked a dozen accountants what a flight costs you would get at least two dozen replies. Different airlines will account for costs differently and make different decisions.
You have the direct costs (fuel, crew, landing fees, etc) but also overheads (running the head office, etc). You can always look up an airlines accounts and divide the total costs by the available seat km which gives cost per available km. Costs such as handling may be a bit higher for longer distance flights but certainly don't rise in line with stage length so longer flights should have a lower cost/ASKm. The other approach, as suggested, is calculate the fuel cost per sector (hours x tonnes/hr x cost/tonne) and divide this by the proportion of costs accounted for by fuel. This approach would work if fuel costs were stable (of course they never are).
If you look at airline seat plans long haul J class seats may occupy three times the floor space as Y. However the load factor will be lower. Take this into account and you would expect to pay four times as much. I don't know how catering costs differ between the two or indeed total passenger service costs including lounges, etc.
I suspect that the average yield for J compared with Y is more than 4 times as much on some routes although it will obvious vary by time of year. A few years ago I read that all the profit on the North Atlantic came from premium traffic and that Y made a loss (although again this will vary by airline, route, time of year, etc).
One of the reasons for the growth in premium economy is the huge gulf between J & Y. I have read that its profitability is closer to that of J than Y, its good for the bottom line. Looking at fares it seems that many travellers are willing to pay a high premium.
Its interesting that BA are reconfiguring some of their 747s increasing J and reducing Y. They obviously think that the money is in J.
It would be interesting to know how much it would cost to reduce density and if people would pay. Airlines claim that punters won't pay extra, although that may depend upon how tall one is.
Paxing All Over The World
History shows that there are not enough people willing to pay a penney/cent more than they have to. The airlines know the price tipping point for any sector. They know when/where there is a big event and plan capacity and prices acordingly. There are still 'bucket shop' type operations but far fewer than there used to be (hint: Computers!)
There is a basic economy class being talked about and even offered by some airlines. Seating is a higher density in that part of the cabin or involves getting the middle seat, limited if any baggage allowance and possibly no meal or frequent flyer points. Its a step down from regular economy in the same way that premium is a step up.
Fares reflect the lack of frills, however the frills are available on the same aircraft at a higher price. This enables full service airlines to compete with low cost carriers without setting up a separate operation. Passengers can buy the level of comfort that they are prepared to pay for and have no justification in complaining as product and price are laid out at the time of booking.
I sometimes see four levels of economy ticket available; Fully flexible, regular, saver and super promo with decreasing flexibility and increasing cost to alter the tickets as the price goes down. However the cabin and amenities are still the same.
Basic takes this a step further enabling the cost conscious to pay less for a lower standard in the cabin. A college student going home on holiday on a two hour flight would probably be quite happy with basic, a couple going on honeymoon would want a bit more and a business man would want flexibility. Everyone could be catered for by the same airline on the same aircraft.
Airlines to Introduce a New Passenger Class Below Economy - Fortune
Fares reflect the lack of frills, however the frills are available on the same aircraft at a higher price. This enables full service airlines to compete with low cost carriers without setting up a separate operation. Passengers can buy the level of comfort that they are prepared to pay for and have no justification in complaining as product and price are laid out at the time of booking.
I sometimes see four levels of economy ticket available; Fully flexible, regular, saver and super promo with decreasing flexibility and increasing cost to alter the tickets as the price goes down. However the cabin and amenities are still the same.
Basic takes this a step further enabling the cost conscious to pay less for a lower standard in the cabin. A college student going home on holiday on a two hour flight would probably be quite happy with basic, a couple going on honeymoon would want a bit more and a business man would want flexibility. Everyone could be catered for by the same airline on the same aircraft.
Airlines to Introduce a New Passenger Class Below Economy - Fortune
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They then say they will pay a bit more for increased comfort, a couple of inches more leg room and a better quality meal.
BA online one-way fares per seat for the Gatwick - Orlando service, May 2017. Typical for a family heading to Disney, for example:
Economy: £1298
Premium Economy: £1800
Premium Economy: £1800
Let's expand that request to two adults and two children, still one-way:
Economy: £5,045.28
Premium Economy: £7,199.28
Premium Economy: £7,199.28
Firstly, if you’re paying those sort of fares for economy, you’re dumb anyway.
Secondly, I don’t think anyone pretends that Premium Economy or Business represent value for money. Those cabins exist because some passengers are willing to pay for them.
Secondly, I don’t think anyone pretends that Premium Economy or Business represent value for money. Those cabins exist because some passengers are willing to pay for them.
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TravellersUnited - the site that claims 'too many' people are denied boarding or removed for being 'drunk', 'unfit', 'unruly' or being too fat. They are an anti-airline hobby blog. Nothing more, nothing less. They are not authoritative.
At the end of the day, YOU choose who you spend your money with. If a service provider does not provide a service that meets your demands and needs, then go elsewhere to someone who does.
Airlines exist to make a profit. Period. They are not public services nor do they operate for the benefit of passengers.
People seem aggrieved that the airlines are finally making money after years of huge losses and in some places government bailouts. Now they're making money people seem somewhat annoyed.
Should we go back to the days of bloated government run money pit airlines? After all these were the 'good times' of 'free food', 'free bags' and massive legroom. Oh, and terrible reliability and safety. Or maybe we should re-regulate the airlines and make them fly with 2% load factors to places that don't warrant all jet services? Or maybe we should go back to the days or £600 day return for UK domestics or AMS/CDG routes? No?
Airlines are providing services for which the market can support. They're making money too. Good on them.
At the end of the day, YOU choose who you spend your money with. If a service provider does not provide a service that meets your demands and needs, then go elsewhere to someone who does.
Airlines exist to make a profit. Period. They are not public services nor do they operate for the benefit of passengers.
People seem aggrieved that the airlines are finally making money after years of huge losses and in some places government bailouts. Now they're making money people seem somewhat annoyed.
Should we go back to the days of bloated government run money pit airlines? After all these were the 'good times' of 'free food', 'free bags' and massive legroom. Oh, and terrible reliability and safety. Or maybe we should re-regulate the airlines and make them fly with 2% load factors to places that don't warrant all jet services? Or maybe we should go back to the days or £600 day return for UK domestics or AMS/CDG routes? No?
Airlines are providing services for which the market can support. They're making money too. Good on them.
The fares quoted are one way, I can easily find return tickets for half of those prices. Booking a year in advance is a bit too much, around three months ahead will get a better deal. Premium economy is nearly twice the economy fare and for a flight of around eight hours, difficult to justify. Also P/E fares on a direct route with a major airline get quite close to business class fares on a second level airline involving a connecting flight.
The London - New York route is weighed towards premium passengers who keep the price down in the rear cabin. A business class ticket is typically 5X the economy fare, where as London - Bangkok is around 3X.
Someone wanting LON - SYD without a stopover on the way might be able to justify the extra expense as they will be onboard for nearly 24 hours with only a short refuelling stop to break the journey and will need to get a few hours sleep.
An Auckland - London flight via Los Angeles or Singapore would be one of the few routes where business class could be worth paying for.
The London - New York route is weighed towards premium passengers who keep the price down in the rear cabin. A business class ticket is typically 5X the economy fare, where as London - Bangkok is around 3X.
Someone wanting LON - SYD without a stopover on the way might be able to justify the extra expense as they will be onboard for nearly 24 hours with only a short refuelling stop to break the journey and will need to get a few hours sleep.
An Auckland - London flight via Los Angeles or Singapore would be one of the few routes where business class could be worth paying for.
Paxing All Over The World
metro man
I agree and we did pay extra for PE but hundreds of people choose to pay the least possible and be cramped up for nigh on 24 hours. Every day of the week, hundreds go from the UK to Oz in Y. What percentage who will pay more?
Someone wanting LON - SYD without a stopover on the way might be able to justify the extra expense as they will be onboard for nearly 24 hours with only a short refuelling stop to break the journey and will need to get a few hours sleep.
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I did that route quite a few times, with GVA-LHR and SYD-CBR connections. In the end, for me, doing the entire journey in one go was best. Breaking it up with a day or two in BKK or SIN was the worst. Can't imagine a DXB routing either. One medium and one ultra LH wouldn't appeal to me.
I certainly wouldn't do any of the above in Y though.
I certainly wouldn't do any of the above in Y though.
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Hearty Meatballs said
So this is what business has come to these days. No benefits for their paying customers? Wow! You seem to come from the Ebenezer Scrooge school of business. But remember what happened to him.
and.... of the good old days when we all were so smug for being comfortable while traveling...
This statement is unrelated to the topic. Safety standards today are due to the new planes and training, nothing to do with the airlines themselves, they have to follow these rules, period!...god help us if they didn't, could you imagine what they would cut for profits?
"we only need one pilot"
"who needs seatbelts"
"regular checks are expensive, we will cut back on them"
"if everyone stands we can cram in more passengers" (we have heard about this idea)
So Hearty, Singapore Airlines is a government owned airline, the best airline in the world, offers good legroom, free meals, clean planes and outstanding service...what is so wrong with that? They seem to be doing just fine...
Airlines exist to make a profit. Period. They are not public services nor do they operate for the benefit of passengers.
and.... of the good old days when we all were so smug for being comfortable while traveling...
Oh, and terrible reliability and safety.
"we only need one pilot"
"who needs seatbelts"
"regular checks are expensive, we will cut back on them"
"if everyone stands we can cram in more passengers" (we have heard about this idea)
So Hearty, Singapore Airlines is a government owned airline, the best airline in the world, offers good legroom, free meals, clean planes and outstanding service...what is so wrong with that? They seem to be doing just fine...
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Um, passengers do benefit. They get from A to B in great safety and airlines deliver the product that they have been contracted by the passenger to deliver at a price they are willing to pay.
Airlines that are state run or state subsidised have an unfair advantage and provide poor value to taxpayers in their respective countries that have to bankroll bloated organisations or vanity projects. SQ is indeed a very good airline, however the government is a 55% shareholder.
You're entirely wrong about airlines not contributing to safety. Many airlines have made numerous safety improvements. To say it's all about new aircraft (I don't recall a statistic to prove that there's a direct correlation between aircraft age and the likelihood of a hull loss) and training is a little narrow minded.
Airlines that are state run or state subsidised have an unfair advantage and provide poor value to taxpayers in their respective countries that have to bankroll bloated organisations or vanity projects. SQ is indeed a very good airline, however the government is a 55% shareholder.
You're entirely wrong about airlines not contributing to safety. Many airlines have made numerous safety improvements. To say it's all about new aircraft (I don't recall a statistic to prove that there's a direct correlation between aircraft age and the likelihood of a hull loss) and training is a little narrow minded.
Paxing All Over The World
With all this talk of greed - if the millionaire I mentioned a while back - only wants to pay the cheapest price and (although he can easily afford it) only travels in Y:- is he greedy too? Or does greed only attach to the receiver of the money?