Thursday, December 13, 2012

Choices, choices, choices! American Airline Adds Another Wrinkle to the Process of Shopping for Airfares

Goodbye to the days when all economy seats cost the same amount of money. American Airlines is re-writing the rules to input three different classes of fares at the back of the plane, and the price differences have nothing to do with the in-cabin experience (so no extra leg-room for the uptick in price). Instead, passengers will be asked to pay $68 more, per round-trip, to waive a slew of other fees.

Here's how it works: those who choose the new "Choice Essential" fee will have the right to check one bag without paying more (a value of $25 each way, $50 round-trip), will have priority boarding, and will not have to pay the $150 change fee should they need to switch their flight (though they will have to pay any additional cost if the flight is a more expensive one). T

The "Choice Plus" option, which costs an additional $88, will include all of the above, plus 50% more frequent flyer miles accrued per flight and the right to change flights on the day of the flight without penalty. This last perk might be particularly appealing to business travelers, as they'll be able to hop an earlier flight without penalty should their work wrap up earlier than expected. To celebrate this all, the Choice Plus customer will also be offered one "premium" (read: alcoholic) drink onboard the flight.

A final option "Fully Flexible" will allow the passenger to fly the plane to wherever he wishes. KIDDING! No, on this one, which will have a sliding scale in terms of fees, passengers get all the perks of the Choice Plus ticket, plus an additional checked bag included in the rate, and a better shot at getting upgraded. (Technically, this last will work by allowing the passenger to use a 500 mile upgrade certificate, but only after AAdvantageElite status fliers have been assigned their upgrades).

Except for overpackers, I don't see how "Fully Flexible" will be worth the extra outlay (whatever that is). And I should note at this point that these fare classes are only for domestic fares, at this stage.

All this leads to the question: why is American doing this? I have two guesses. First off, they want to encourage folks to book directly at their site, so they can avoid paying commissions to the Travelocitys and Expedias of the world. That being said, some of the online travel agencies do have sophisticated enough booking engines to support these new categories (and likely those that don't will work like crazy to make sure that they do soon. Travel agents will also have access to these different tiers of fares).

More importantly, the airline probably know that the vast majority of passengers never need to change their fares; and an increasing number simply carry their luggage into the cabin (like me). So they're tempting folks to gamble that something will go wrong, knowing that it likely won't. Ah, the house always wins, doesn't it.

For now, I'm going to stick with the so-called "Choice Fare", which is what we're all used to (ie no priority boarding, checked baggage fees, etc.). But I'll be curious to see how popular--or not--these options prove to be. Will the public buy them? Or will they not even bother to research these options, preferring to spend their time on more fun parts of the travel planning process (like restaurant selection). We'll see!

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