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+--- Thread: American Airlines raising fees to upgrade seats (/showthread.php?tid=2497)
American Airlines raising fees to upgrade seats - macuu222 - 08-11-2008
This was bound to happen with the high cost of jet fuel. Frankly I'm suprised that the mileage programs are still in existance with airlines trying to find new ways to cut costs. If I were a frequent flyer with lots of mileage...I'd be getting rid of my miles really quick
http://www.honoluluadvertiser.com/apps/pbcs.dll/article?AID=/20080811/BUSINESS/808110337/1071
RE: American Airlines raising fees to upgrade seats - John S. Rabi - 08-11-2008
They are not stupid to discontinue the FF program, it's generating money for them! They sell all these miles to credit card companies and other merchants, but in the meantime, they make it more and more difficult for people to redeem them. It's a win-win situation for the airlines.
Aloha,
John S. Rabi, GM,ARB,BFT,CM,CBR,FHS,PB,RB
808.989.1314
http://www.JohnRabi.com
Typically Tropical Properties
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RE: American Airlines raising fees to upgrade seats - JerryCarr - 08-11-2008
In the short term, the airlines can get away with alienating a certain number of customers because they are all cutting capacity and will have fewer seats to sell. The customers who get mad and ditch Airline A may just switch to Airline B which has had an equal number get mad at them and switch to Airline A, or somebody else. In the longer term, however, people are going to remember who screwed them over the worst, and it will come back to haunt them. There is a race to the bottom, and whoever lands there the hardest will eventually pay a price.
And Mr. Rabi is right about the airlines selling miles. There have been several of them recently whose only profitable business sector was the selling of miles. At one point recently, American's frequent flyer program was given a higher monetary value by Wall Street than the airline as a whole.
What this means for Hawaii is obviously a difficult environment for the tourist business, unless and until oil prices drop to something like $70. That is what some of the airlines give as the top price that they can maintain their previous levels of service capacity and pricing.
Cheers,
Jerry