BA From United States of America, joined May 2000, 11198 posts, RR: 57
Reply 1, posted (13 years 4 months 2 days 17 hours ago) and read 2337 times:
This may hurt Frontier.
Lowering fares can be a good thing. Lower fares obviously boost load factors, however lower fares at the same time mean less income. If the income is too low, it won't matter if they are filling up planes or not.
Regardless, United has probably done the research and concluded that lowering fares in favor of higher loads is probably the best way to go even if it isn't a great way to go.
"Generosity is giving more than you can, and pride is taking less than you need." - Khalil Gibran
Mariner From New Zealand, joined Nov 2001, 27627 posts, RR: 81
Reply 5, posted (13 years 4 months 2 days 13 hours ago) and read 2264 times:
It's a very curious bankruptcy.
By its own admission UAL will be cash flow negative to the tune of $15 million a day this month. Under the terms of their DIP financing, they have to become cash flow positive by the end of February.
So I'm not sure how slashing business fares will help. They'll get some more passengers, but at what cost?
Nor am I sure how much it will hurt Frontier, BA. Those high end pax aren't targeted by F9. Yes, they may lose some, but hey, on F9 you still get some food, and, on certain flights, PTV. Although the official start up of the PTV's won't be announced until more aircraft are retrofitted, apparently they've been offering it for a while as a freebie, and on 1 January began charging the $5.