AVIATN 3000 Chapter Notes - Chapter 6: Cash Flow
30 Jun 2018
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Department
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For low-demand routes, higher low-fare seats
a)
Peak time flights will have higher fares
b)
Revenue management System is used to decide
number of low-fare seats on different flights
1)
Non-discriminatory, makes sure low-cost is
genuine
a)
Setting and enforcing restrictive conditions on
discount fares
2)
For long-haul flights, there are higher
minimum stay at destination for low fares
a)
Designed to restrict business traveler's
freedom of action. Cost-related
b)
Over time, airlines make this more flexible,
withdrawn
c)
Minimum Stay Conditions
3)
If passenger stays longer than stipulated max,
they have to pay full fare to return
a)
Less effective, declined in recent years
b)
Maximum Stay Conditions
4)
Helps airline improve cash flow, force low-
yielding demand to purchase early
a)
Makes it difficult for business travelers to pay
discount fare
b)
Advanced Purchase
5)
Standby
6)
The Management of Discount Fares
A)
Uniform and Differential Pricing
I)
Reading Chapter 6: Pricing Final
Sunday, February 18, 2018
5:22 PM
Midterm Page 1
Document Summary
Revenue management system is used to decide number of low-fare seats on different flights a) b) Setting and enforcing restrictive conditions on discount fares a) For long-haul flights, there are higher minimum stay at destination for low fares. Designed to restrict business traveler"s freedom of action. Over time, airlines make this more flexible, withdrawn b) c) If passenger stays longer than stipulated max, they have to pay full fare to return. Helps airline improve cash flow, force low- yielding demand to purchase early. Makes it difficult for business travelers to pay discount fare b) A-la carte pricing allows for increased revenue from hold baggage and food/drinks onboard the flight. Shouldn"t be offered on off-peak flights c) d) Stage-of-life fares: low cost offered to children, young people, senior citizens. Rival airlines comes into market with discount fares, might be short term or substantial and long term.
