|Quoting 8herveg (Reply 5):|
Sorry, do not mean to sound ignorant, but can you explain lower yields to me please....I am new to airliners.net and very young!!
Well, there are several ways of measuring the profitability of a route. Load factor is the percentage of seats that are filled on a flight; however, that doesn't necessarily reflect the amount of money the airline is making on that flight. The seats might be full, but if the tickets were all very cheap, the airline would still lose money.
Yields reflects the actual money the airline makes. So for example, even if the economy cabin is empty, the flight may have a full business class, and so be high yielding. Yield can be measured by looking at two statistics: CASM (Cost per Available Seat Mile), and RASM (Revenue per Available Seat Mile). Airlines are far more tight lipped about yield then load factor though.
For destinations like FCO
, which I understand are largely VFR (Visiting Friends and Relatives), the flight is likely quite low yielding since there would be few business travellers. Even if AC
makes a fair amount on the route, it would be primarily from the economy fares (Y class) rather than business fares (J class). In this case, it makes a lot of sense for AC
to market their domestic J class as premium economy on these routes, as a VFR traveller is far more likely to upgrade to premium economy than to business class. So, for AC
, this makes sense on two fronts. First, they likely don't have any 767 available with executive first to operate the routes. Second, by marketing the domestic J class as premium economy on these routes, the front cabin is more likely to be filled up, and they are very likely increasing the yield of the flight.