Qantas fares to LAX. I don't get it!

[maninblack]

I am a bit mystified. I have to do two trips to the US over the next few months with 2 people traveling and can get business class for about half the price of Qantas with any of the other trans-Pacific carriers. So who is actually paying for QF seats at the current price levels?

 

[opusman]

I am a bit mystified. I have to do two trips to the US over the next few months with 2 people traveling and can get business class for about half the price of Qantas with any of the other trans-Pacific carriers. So who is actually paying for QF seats at the current price levels?

From all accounts no one, J is full of bumped-up passengers from the oversold Y section

 

[maninblack]

From all accounts no one, J is full of bumped-up passengers from the oversold Y section

That is not the case and J is not full and Y certainly is not. Though they did release a higher number of FF tix when the economy was diving, out only out until July.

 

[NM]

I am a bit mystified. I have to do two trips to the US over the next few months with 2 people traveling and can get business class for about half the price of Qantas with any of the other trans-Pacific carriers. So who is actually paying for QF seats at the current price levels?

People who, despite there being cheaper options, still insist on or want to fly Qantas.

I guess its all about numbers. Sell 25% of the J cabin for $10,000 return fares and fill the remainder with upgrades (points and op-ups) from $1500 Y fares), or sell 75% of the J cabin for $5000 return fares and stop selling Y fares when the cabin is sold out.

The trick to selling heavily discounted J fares is to encourage the regular J passengers to still pay the full fare price and only sell the discounted fares as incremental capacity. Generally that means applying some restrictive conditions to the fares that discourage them from being used by the regular business travellers and encourage others that would not normally travel J to spend more than they otherwise would on a PE or Y ticket. Hence we have seen sales like 2-for-1 deals etc.

If they only sell the discount J fares to people who would have otherwise paid the non-discounted fares then they are losing revenue.

Its a real balancing act.

The fact that you can but discounted J fares cheaper elsewhere implies to me that Qantas still thinks it is doing better in premium cabin sales than the other believe they are doing at the moment. They are certainly doing ok in selling the economy cabin at the moment, and perhaps they have learned a lesson from being too aggressive with the sales a few months back and don't want to undermine what premium cabin ticket sales exist now.

One problem they have with selling discount business class fares is that most of the non-discount fares are fully refundable. This means people who have existing non-discounted tickets may find they can cancel and refund those and rebook for a lower cost. So a business class fare sale that does not impose the right restrictions can really undermine the already fragile revenue stream. Qantas is renowned for its conservative approach to such revenue management.

 

[maninblack]

Hmm NM, I hear what you are saying but all I can say is they are losing my business over the past year including 2 Europe trips (6 tickets) 2 Asian trips (4 Tickets) and 1 of my North America trips (4 tickets) where I used AC as Oneworld does not really exist in Canada. All business and first class.

So my *Alliance status has reached top tier and my OW status will fall. When you do this much travel eventually you cannot justify the insane QF ticket prices and the lack of OW options in many regions, and of course as I am based in MEL QF provides me with even less. So you end up with a change of allegiance which becomes more or less permanent. I am not the only one I can assure you.

All I can say is that if they want to lose my business then they are going the right way about it.

 

[NM]

Hmm NM, I hear what you are saying but all I can say is they are losing my business over the past year including 2 Europe trips (6 tickets) 2 Asian trips (4 Tickets) and 1 of my North America trips (4 tickets) where I used AC as Oneworld does not really exist in Canada. All business and first class.

Yep, that is one of the risks of the process is yield management. And you will not be alone in your decision. The current situation has provided some good value for travellers and some headaches (and nightmares!) for airlines. I think this is one reason Qantas is pushing so hard to expand their loyalty program, including the recent move to lock people in with direct-sweep credit cards and now the Woolies tie-up with Everyday Rewards. I think they see these loyalty moves as partly compensating for people like yourself who place different value on price and understand that loyalty can be portable.

 

[J Michael]

Well, my mother always used to say to me, if you have to ask how much it is you can't afford it.

SO yeah, the people that are in J class are either:

Bumped up from S class (because that is the cheapest upgradeable QF class) SHBB is about $2815 gross pls taxes

Rich mof_s who couldnt give a ****e about price
Corporate travellers or Entertainers who have it written into their contracts that they must fly QF J class AP (artists, musicians, politicians, bands, celebs, academics)

QF **** all over UA, the only other competitor giving them a run for their money on the direct route (NZ are fantastic) now are V Australia and of course they're a thousand times cheaper at the moment whilst they establish their name to steal business from QF. Once they are established I would expect the fares to be very comparable, I wouldnt fly delta if you paid me

 

[straitman]

J Michael,

Welcome to AFF with an interesting first post.

 

[J Michael]

J Michael,

Welcome to AFF with an interesting first post.

Why thank you, I've been perusing for a while now just thought I'd start adding my 3 cents in

 

[maninblack]

Well, my mother always used to say to me, if you have to ask how much it is you can't afford it.

SO yeah, the people that are in J class are either:

Bumped up from S class (because that is the cheapest upgradeable QF class) SHBB is about $2815 gross pls taxes

Rich mof_s who couldnt give a ****e about price
Corporate travellers or Entertainers who have it written into their contracts that they must fly QF J class AP (artists, musicians, politicians, bands, celebs, academics)

QF **** all over UA, the only other competitor giving them a run for their money on the direct route (NZ are fantastic) now are V Australia and of course they're a thousand times cheaper at the moment whilst they establish their name to steal business from QF. Once they are established I would expect the fares to be very comparable, I wouldnt fly delta if you paid me

Your mother was wrong. It is those who ask how much who can continue to afford it. Just because people have a lot of money does not mean they are stupid with it, usually the opposite.

I agree with you about some of those who are paying the price.

As to QF, yes their service is better, but their seat (the main thing you actually pay for) on the 744 which is still 90% of flights is perhaps now the worst. Delta and V have the newest aircraft, DL have the same seat as AC which people hate in the photos but I rate it one of the best J class seats in the sky. The new UA seat looks the goods and the V seat looks a bit ordinary but it is flat. And NZ are half the price of QF. The IFE is all much the same ultimately.

So double the price for a friendlier FA and some better wine, that does not stack up.

As for academics and artists flying in J...that's funny. Most of them can barely afford a car.

 

[NQflyer]

I know quite a few Australian defence personnel fly that sector in Business class.
Qantas and The Australian Defence Force have one of the biggest corporate contracts in Australia. All officers travel on QF full J class fares internationally and full Y domestic. I know it's not enough to fill QF planes, but Australian tax payers are still certainly paying that over priced airfare for our defence force to travel up front. Why not send them on V Australia instead for half the price. Waist of money I say!

 

[medhead]

As for academics and artists flying in J...that's funny. Most of them can barely afford a car.

He must be referring the the Business school academics. they'd be the only academics who would bother getting such a condition written into their contract. All the academics I know are too busy applying for grants, so that they can still have a job next year, to worry about fine details in employment contracts. Besides if they wrote a condition about flying J, then they'd have to chase another grant to pay for the airfares.

 

[NM]

All officers travel on QF full J class fares internationally and full Y domestic.

I bet the net fare paid is not the full J or Y fare. Even if they pay the full published fare up front there will be a significant percentage returned as part of the contract. More likely they are paying a significant discount off the full J and full Y fare, but the ADF fares book into J and Y fare buckets and hence have access to J and Y availability but at significantly discounted fares.

There are three common ways contracts operate:

• They pay the full published fare and receive a kick-back at the end of each accounting period (may be monthly or quarterly) based on the amount spent.
• They receive a discount off the published fare with the amount of discount depending on the type of fare purchased.
• Qantas establishes a special corporate fare for them that may book into J/Y but has its own special fare basis code and terms and conditions. Such special fares are only able to be sold to the contracted organisation. For example the fare basis may look something like JRTADF or YOWADF.

The company I work for has used all three of these contract types over the last few years.

 

[straitman]

I know quite a few Australian defence personnel fly that sector in Business class.
Qantas and The Australian Defence Force have one of the biggest corporate contracts in Australia. All officers travel on QF full J class fares internationally and full Y domestic. I know it's not enough to fill QF planes, but Australian tax payers are still certainly paying that over priced airfare for our defence force to travel up front. Why not send them on V Australia instead for half the price. Waist of money I say!

NQflyer,

As NM states it is a fairly wild assumption on your part that ADF personnel travel full 'J'.

There will be significant discounting somewhere in the process.

 

[NQflyer]

NQflyer,

As NM states it is a fairly wild assumption on your part that ADF personnel travel full 'J'.

There will be significant discounting somewhere in the process.

Ok, well I hope that is the case anyway. I was just going on what I had been told by a few of my ADF friends who travel to the US allot business class.
Few years ago I worked for Malaysia Airlines in Sales and Marketing and I know the occasional booking we got from defence force travel when Qantas couldn't accommodate was always a high end fare. Just have to say Qantas are in a very good situation to have such a contract with the ADF. I am sure Virgin Australia would love a piece of that too.

 

[maninblack]

Qantas has many "favorable" contracts with government agencies and medium to large corporates, but these guys are out shopping now given the current climate. I was told yesterday of one very large corporate that just moved all their domestic travel To Virgin and I believe their US travel too.

QF has benefited in the past by still being perceived as "the national carrier", which is rubbish now of course and by picking up everyones business after the Ansett failure.

I also spoke to a friend who is a former senior executive of CO and still works in travel who said QF's current fares to the US will not be maintained long term at these booking levels. He also suggests some QF services would be absolutely bleeding them at the moment, including my favorite, SYD-EZE.