Multi-seat pricing - is it ethical?

albatross710

Established Member
Joined
May 15, 2004
Posts
3,751
Unlike hotels which will generally make multi-night hotel bookings as the average nightly price, airlines charge all seats at the highest price for the seats requested.

For example on an upcoming flight 1 and 9 seats per booking are priced as :

Seats requested
1​
2​
3​
4​
5​
6​
7​
8​
9​
Offered Price
$139​
$139​
$267​
$267​
$267​
$267​
$267​
$267​
$267​
3 people, 2 bookings
$139​
$139​
$267​
=​
$545
3 people, 1 booking3 x 267$801

In this scenario, a 3 seat buyer buys 2 seats for $139 ea. The 3rd seat is into the next fare bucket at $267. Total price for 3 = $545

Taking the airline's offer for 3 seats in one purchase and the total price is $801 - 46% more.

If you are a travel planner, corporate buyer or buying for a family group please investigate breaking a purchase into multiple bookings. Of course, trade that off with managing multiple bookings.

BUT, should the airlines be offering these seats at the more 'ethical' price anyway. Unfortunately as an outside I don't know if the airlines consumers 3 seats from the higher bucket and the $139 seats remain for single purchases.
 
Unlike hotels which will generally make multi-night hotel bookings as the average nightly price, airlines charge all seats at the highest price for the seats requested.

For example on an upcoming flight 1 and 9 seats per booking are priced as :

Seats requested
1​
2​
3​
4​
5​
6​
7​
8​
9​
Offered Price
$139​
$139​
$267​
$267​
$267​
$267​
$267​
$267​
$267​
3 people, 2 bookings
$139​
$139​
$267​
=​
$545
3 people, 1 booking3 x267$801

In this scenario, a 3 seat buyer buys 2 seats for $139 ea. The 3rd seat is into the next fare bucket at $267. Total price for 3 = $545

Taking the airline's offer for 3 seats in one purchase and the total price is $801 - 46% more.

If you are a travel planner, corporate buyer or buying for a family group please investigate breaking a purchase into multiple bookings. Of course, trade that off with managing multiple bookings.

BUT, should the airlines be offering these seats at the more 'ethical' price anyway. Unfortunately as an outside I don't know if the airlines consumers 3 seats from the higher bucket and the $139 seats remain for single purchases.
Yeah I agree, although there will be a challenge with respect to fare rules and voluntary changes when the higher priced fares have different fare rules to the cheaper fares. But with ‘new distribution capability’ in the GDS, there’s no need for the archaic “fare buckets” anymore IMHO.
 
It’s probably their SIMPLIFIED solution to a tricky issue of multiple PAX - and of course in their favour extracting more $$ from the wallet

Imagine trying to choose which PAX pays more or less. Would be like splitting the account at a restaurant. Messy

That said, people could book their own airfares so at least one or two might choose the lower fare bucket ?
 
It’s probably their SIMPLIFIED solution to a tricky issue of multiple PAX

The core issue is GDSes were built around one PNR only being able to hold a flight segment of the same sub class, eg. N class. This means everyone on the booking must be booked in N class. Basically it revolves around a flight segment and what class that flight segment is.

The so-called New Distribution Capability (NDC) that's slowly coming in, doesn't move away from this concept either. All it does is move away from being limited by a 26 character alphabet by having sub price points within a subclass letter, eg. N class might have 3 pricing points.

That said, this capability of having sub price points or multiple price points within a class is not exclusive to NDC either. Airlines made it work with the existing GDS systems by filing dual inventory fares, eg. QF J fares in D class might have 3 fares filed. Fare 1 at $500 requires both D class and O class (a Y subclass) to be available, fare 2 at $600 requires both D class and Q class to be available and fare 3 at $800 requires both D class and N class to be available. In effect, this allows the J fares to scale up and down based on available Y cabin inventory.
 
During my corporate days, the TA would never book 2 or more on the same ticket (always seperate). Maybe because of this but also due he obvious issue of one can’t travel at the last minute etc

Several times I saw a 241 offer that could save the company money but “Computer said no”.

Meanwhile, presumably those cheaper seats stay in inventory for a smaller party?

QF (and others) will warn the buyer with “X or less” seats at this price. So it shouldn’t come as a surprise.
 
the TA would never book 2 or more on the same ticket (always seperate). Maybe because of this but also due he obvious issue of one can’t travel at the last minute etc

Several times I saw a 241 offer that could save the company money but “Computer said no”.

Meanwhile, presumably those cheaper seats stay in inventory for a smaller party?

QF (and others) will warn the buyer with “X or less” seats at this price. So it shouldn’t come as a surprise.

Lets clarify some terminology here...

A ticket does not equal a PNR. A PNR can contain multiple pax, with multiple tickets for each of those pax. Think of a PNR as a book (PNR) - a book can have multiple chapters (tickets) and each chapter can be multiple pages (ticket coupons - up to a maximum of 16).

Group PNRs for example can have as many as 99 pax in one PNR... so as you can imagine, that means one PNR can hold at least 99 tickets.

With regards to one pax in a party not travelling, it's not a big deal if one pax cannot travel when they are one of multiple pax in a PNR, nor has it been for many years.

If the pax not travelling knows ahead of time that they won't be travelling, then you split the pax not travelling off the original PNR onto a new PNR and then you cancel the flights off the newly split PNR. You can then refund or rebook as desired.

If it's last minute, eg. 2 of 3 pax checked in on time and 1 pax is running late because their Uber driver cancelled on them and they couldn't get another Uber pickup... then the pax would just not be checked in and be marked as a no show.

If they had already checked in online, then the gate agent will offload the pax when it's evident at time of gate close that this pax has not presented at the gate. It's a bit more complex for multi flight journeys, eg. pax stuck in immigration on a SYD-LAX-JFK, but the concept is basically the same.

Now on the topic of whether the cheaper seats stay in inventory...

Since many here are familiar with QF's subclasses... QF uses the following subclass hierarchy in Y: Y, B, H, K, M, L, V, S, N, Q, O, E. We'll ignore X as that's only used for awards.

Lets say the inventory available on a given flight is:

Y9 B9 H9 K9 M4 L2 V0 S0 N0 Q0 O0 E0.

The behaviour of what happens to the availability of the 2 L class seats, if the 4 M class seats are sold, depends on how the airline has their inventory controls configured. The below illustrates simplified example scenarios, in reality the controls are setup with more complexity. The below examples are not specific to QF and are not necessarily reflective of how QF manages their inventory.

Some airlines have their inventory configured such that the cheaper subclasses are open for sale based on X seats sold on the flight in that cabin. Eg. E class is open on the flight until 20 seats total are sold in Y, then O class might close when 25 seats have sold, etc. Further along, lets say L class would closes when 70 seats are sold.

Lets say this flight currently has 68 seats sold. If you were to take the 4 M class seats, then the flight would now have 72 seats sold, so the threshold for L class closing has been met, and therefore those 2 L class seats will also disappear when the 4 M class seats are sold.

Some airlines split up their subclasses into categories if you like, and then within these categories they define further rules around when to open/close subclasses. QF for example uses Y, B, H, K for domestic flexible economy and the remainder for domestic saver/sale economy.

QF could define they want 150 seats out of 300 seats on the flight to be sold as saver/sale category, with the remaining 150 to be sold as flexible. Lets say it's a business traveller heavy route and therefore flexible economy fares are preferred. On such a route it can be possible to see that a flight might have only 20/150 seats sold as saver/sale but 140/150 sold as flexible.

Now if there's only 10 seats left for the flexible category and 130 seats left for the saver/sale category, the inventory availability might look something like:

Y9 B5 H0 K0 M9 L9 V9 S9 N9 Q9 O9 E0

Notice the H0 K0, but the lower classes are wide open? If you see inventory that looks like this, then it's possible that the airline has chosen to split the inventory into categories.

If we are to then sell the 5 B class seats (flexible), will it draw down the M/L/V/S/N/Q/O inventory? Probably not, assuming that this is how the airline has categorised their inventory.

It's not just airlines where searching for more pax can result in higher pricing, it can happen with hotels and others. If you search for 6 adults across 3 rooms, you might see only superior rooms available even though there is actually one standard room left, but if you search for only 1 room you will see standard rooms available. It's the exact same issue at play here.
 
Yeah I agree, although there will be a challenge with respect to fare rules and voluntary changes when the higher priced fares have different fare rules to the cheaper fares. But with ‘new distribution capability’ in the GDS, there’s no need for the archaic “fare buckets” anymore IMHO.
This. Very likely the lower priced fare has more restrictions that the higher priced.
 
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