Last week, British Airways loaded three 747’s into the schedule for domestic flights between London Heathrow, Manchester, Newcastle and Glasgow. Somewhat predictably, as soon as the AvGeek community caught wind of this, seats on these flights sold like hotcakes. Due to this, prices shot up to the point where, as of today (5th June 2019) most of the outbound flights from Heathrow are sold out, and the inbound flights from both Manchester and Newcastle are in the region of £300, where as Glasgow appears to be sold out also.
This has understandably led to a lot of disappointment from those who were priced out of the market. I’ve seen comments along the lines of how unfair it is for BA to be making a profit from these flights, although this isn’t the case. I’m far from a BA fanboy, despite flying them on a regular basis. Believe me, if they mess up, I’m straight on to them! On this occasion though, I feel they are just doing their standard business. It’s worth remembering that the airline hasn’t officially announced anything about these flights, they simply loaded the 747 into their schedules and it was picked up on. These will be regular scheduled flights with a good deal of connecting passengers on board who’s interest will go as far as “this is a bigger plane than last time”.
With regards to the pricing, again, its how airlines work. When a flight goes on sale, it obviously has a set number of tickets – the capacity of the aircraft. Whilst I don’t know the exact numbers, for the sake of this article, lets say there’s 10 of each fare class (A lot of load checkers use 9 although there’s generally more available). At BA, the lowest fare classes are G, O and Q, although the actual letters vary by airline. Now again, I don’t know the actual numbers here, but lets say the starting price for these tickets is £39. So you have 10 G class tickets on sale for £39, but as soon as they have all been sold, the system will then start selling O class, with a minor price bump – to say £45. And again, as soon as those 10 O class tickets have all been sold the sales system will then start selling Q class tickets. Again, no idea on numbers here, but lets say the Q class ticket will sell for £49. Once those three lowest fare classes sell out, the price will then take quite a bump as the mid fare classes will then start being sold. Most of the seats on the flight will be these mid priced buckets as the airline won’t want to lose too much money by selling a plane load of the cheapest tickets, but on the other hand they wont want to price themselves out of the market by only selling the top fare classes. And its these top fare classes which are on sale now. Due to the demand of these flights, the limited number of G, O and Q fare’s sold out within a few hours. Next went the mid fares, and now all that’s left are the top priced fully flexible Y fares for economy and J class fares in Business.
This isn’t unique to the 747 flights either. It’s common across all flights. I looked for a similar departure to Manchester for this afternoon, and it’s a similar situation. All of the lower and mid priced fare buckets have sold out, leaving only the most expensive Y and J classes remaining, again priced at around the £300 mark in the case of the mid afternoon flight. It’s also worth noting that on the 10:10 departure, Business Class is actually cheaper than economy. Again, this is due to the fare class system at work. All the cheaper economy fares have sold out where as there’s still a few mid priced Business fares for sale.
Sure, this is for a last minute booking but the theory is the same. When today’s flight went on sale 364 days ago, it would have been wide open with those cheapest G, O and Q fares. Over time they would have all sold out until all that’s left today is the most expensive fare buckets. A simple case of supply and demand, which is used across the entire business world. If nobody wants what you’re selling, lower the price. If everyone wants your product, milk it for all its worth!
But what do you get for the extra money you pay? Well, truth be told, not an awful lot! Mostly more flexibility with your ticket. If you’re on one of the lower fares, its basically as case of all sales are final. If you need to cancel or change, you’ll be buying a new ticket. With the mid classes, they offer a little more flexibility but you’ll still lose a bit of cash if you need to change things. The top priced fares are fully flexible and include a few extra perks such as free seat selection and in the days before Club Europe was introduced on UK domestic flights, lounge access. I’m not sure if this is still the case though.