Seoling Slashdot blog updates by subscribing to our blog RSS feed. United overbook flight and decided to force random passengers off the plane. Here’s how they did it:. You’re usually pretty safe from being bumped once you’re actually on the plane. That said, the FAA has some well-defined requirements about how they have to treat people who’ve been involuntarily bumped, which includes a hefty cash payment equal, I believe, to the full round-trip fare plus a seat on the next available flight on any airline, in any class airlinrs or above the class you paid. I’ve flown over a million miles, and I’ve been involuntarily bumped exactly. The seat they bought me was on a direct flight, so I actually got home before I would have if I hadn’t been bumped. Oh, and they still gave me mileage credit for the flight they bumped me off of. All in all, I was quite happy with the arrangement. Silly people, imagining that once they’ve paid for something they have any kind of rights.
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This post contains references to products from one or more of our advertisers. We may receive compensation when you click on links to those products. Terms apply to the offers listed on this page. For an explanation of our Advertising Policy, visit this page. Hopefully most of those folks know the importance of paying their balances in full every month. Disclaimer: The responses below are not provided or commissioned by the bank advertiser. Responses have not been reviewed, approved or otherwise endorsed by the bank advertiser. Many of the credit card offers that appear on the website are from credit card companies from which ThePointsGuy. This compensation may impact how and where products appear on this site including, for example, the order in which they appear. This site does not include all credit card companies or all available credit card offers.
NOT QUITE: Financial Analyst Claims “Airlines Make More Money Selling Miles Than Seats”
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Justin Bachman has a Bloomberg piece on the business of airlines selling miles. The Bloomberg piece also overstates the price that airlines are selling miles at — 1. Up until the current K, where American stopped breaking out useful information about the AAdvantage program, we could take the disclosed:. Total miles issued for the year Percentage of those miles sold to third parties Total revenue from mileage sales And calculate the average price at which they were selling miles. That price has ranged from 1. Now, most partners are spending a whole lot more than this. However since the largest chunk of miles have historically been sold to Citibank, and Citi is clearly spending less than this, they bring down the average substantially. That seems crazy. Put another way, Wall Street may be punishing the airlines for devaluing their frequent flyer programs. Gary Leff is one of the foremost experts in the field of miles, points, and frequent business travel — a topic he has covered since Co-founder of frequent flyer community InsideFlyer. I doubt the charges that airlines are attributing aka cost allocation are as accurate as they claim.
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Find More Posts by wetrat0. And that is revenue. Obviously, the usurious interest rates banks charge on credit card debt is highly profitable. Hopefully most of those folks know the importance of paying their balances in full every month. The Points Guy will not share or sell your email. Hi, FlyerTalker! Many of the credit card offers that appear on the website are from credit card companies from which ThePointsGuy. The whole thing is the very clever scheme by the airlines to sell the empty seats, mak perishable product, at deep milfs without offending cash paying customers.
NOT QUITE: Financial Analyst Claims “Airlines Make More Money Selling Miles Than Seats”
This post contains references to products from one or more of our advertisers. We may receive compensation when you click on links to those products.
Terms apply to the offers listed on this page. For an explanation of our Advertising Policy, visit this page. Hopefully most of those folks know the importance of paying their balances in full every month. Disclaimer: The responses below are not provided or commissioned by the bank advertiser. Responses have not been reviewed, approved or otherwise endorsed by the bank advertiser.
Many of the credit card offers that appear on the website are from credit card companies from which ThePointsGuy. This airlines make more money selling miles than seats may impact how and where products appear on this site including, for example, the order in which they appear.
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Please enter a valid email address Please check mailing preferences. Mallorca and Ibiza are cracking down on pub crawls, happy hour and party boats. Activate with your Chase Sapphire card by December 31, Earn 5X points on Lyft rides through March
Your loyalty may be worth much more than your ticket or bag fee — it is a more stable source of income and profitable source of income thanks to lower investment and operating costs. The truth of this statement is to be tested by a product airlines have been able to spin off their core operations: air mile loyalty schemes. They pay an estimated 1. For carriers such as Delta on American Express and American Airlines Citigroupthese loyalty schemes can be a cash cow in terms of revenue. Comparing profit margins of these with core operations give an easy answer as to why air miles are profitable.
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On the other hand, take the financial year for example. Massive expenses include high oil prices, cost of purchasing and hiring jets, landing permits and high salaries for experienced pilots. Apart from being a highly profitable intangible, air miles also have the benefit of being a stable source of income, immune from the cyclical fluctuations of demand and costs related to flying. Air mile schemes are likely to continue to grow as they greatly benefit banks. Although this may be good news for the airline industry, airlines executives must not forget to further improve profits in their core business—namely flying. Do airlines make more money out of loyalty schemes than selling seats? November 17, Henry Le.
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