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The definition of "hidden city ticketing" appears to be "book A -> B -> C, get off at B". Out of curiosity, is it all possible to book A -> B -> C, and travel the B -> C leg? Would the airline sell your seat if you didn't show up at A?
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You mean besides the fact that they will make less money off fares that people wouldn't have found if it was not for this site?
It seems like they use the higher fares to the middle destination to compensate for the higher costs per person of the less popular leg. It's all a complicated algorithm but they have to provide reasonably reliable flights to all of the destinations that they serve in case someone gets bumped. (or they'll have to pay out huge fines to each passenger.)
What actual determines ticket price is mainly the supply and demand around trips between a pair of destinations (like with any other market). Lots of people want to move between DC and New York, and lots of them are business people who can afford to pay a lot, so the market can support a high price for this city pair. This isn't true of, say, DC and Yonkers. What's key, also, is that the layover cities (setting aside people doing the "hidden city" thing) are largely an implementation detail; if you're going from DC to Yonkers, you're comparing the flights that go through New York to flights that go through Philly directly on price (assuming about equal convenience), and you're going to pick the cheapest one. This means market forces are going to drive these prices to be similar, even if the DC->Philly market is radically different from the DC->NYC market. The consequence is weird, unintuitive situations where a flight to the intermediate city can be more expensive than one to the final destination, if market forces are such that the market can typically support a higher price for flights to that intermediate city than they can to the ultimate destination city. Hidden city travelers take advantage of the cost disparity between the markets -- it's a sort of arbitrage.
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The problem is that travel is a bit more complicated than sandwiches -- flight prices end up being set more by competition rather than cost of production. Let's say, per your model, you offering flights from SFO to PDX for $200, LAX to SFO for $100, and sell the LAX->PDX route for $250 (with a stopover in SFO). I decide to start an airline which doesn't fly to SFO, but offers direct flights from LAX->PDX for $190. Yo…
I should just reduce the price of LAX-SFO and SFO-PDX accordingly, so that the cost of LAX-SFO-PDX is the sum of LAX-SFO and SFO-PDX. If I can afford to carry the passenger through LAX-SFO-PDX for $190, then I can afford to carry her LAX-SFO for $x and SFO-PDX for $(190-x).
What in the world? How is that comparison anywhere near remotely justifiable? Absolutely ridiculous.
> American Airlines Group Inc., in a letter to travel agents on its website, suggested it will have to raise fares if it keeps losing money from the practice.
Yes, please do. Price each ticket based on what it costs and a fair margin, not based on competitive meta-market games.
I can only assume that airlines are engaging in potentially unethical pricing themselves. For example, imagine if an airline delivers service from A->C and is low cost. A large competitor airline has no direct route, but flies A->B and B->C, and so offers A->B->C for the same price as the first airline. The route is actually below cost (or has a substantially smaller margin), but the airline offers it anyway to harm its competitor and to keep passengers within its brand. I don't know if I consider this unethical or not, but it's certainly no less ethical than customers taking advantage of hidden city routes for a lower price.
Can someone explain the harm this causes the airlines? I get there's a bit of an opportunity cost because they'll have an empty seat, but apart from that? I feel there's something more here
Earlier quoted context omitted.
It seems like they use the higher fares to the middle destination to compensate for the higher costs per person of the less popular leg. It's all a complicated algorithm but they have to provide reasonably reliable flights to all of the destinations that they serve in case someone gets bumped. (or they'll have to pay out huge fines to each passenger.)
I think this relies on the arguably-faulty assumption that ticket prices are based on airlines' costs in delivering the service. Airlines' costs probably set the floor for ticket prices most (but not all) of the time, but don't have much to do with the typical prices. This obvious when you look at the cost of holiday travel: planes don't become twice as expensive to fly because it's Christmas. What actual determines…
> “Purchasing a ticket to a point beyond the actual destination and getting off the aircraft at the connecting point is unethical,” according to the letter by American, which isn’t party to the case. “It is tantamount to switching price tags to obtain a lower price on goods sold at department stores.” What in the world? How is that comparison anywhere near remotely justifiable? Absolutely ridiculous. > American Airli…
I expect that the airlines will be unsuccessful in their suit but will get the FAA to approve a fee that would be charged if a passenger did not make the complete flight. In the back rooms they will tell the FAA its for passenger safety, after all its important in an emergency to know who is really on the plane, and people who get off early are putting first responders in harms way as they will go looking for people who aren't actually on the plane. They will argue they need a way to discourage that behavior and one way to do that is to charge a hefty "early exit" fee should a passenger depart the route mid-route. They would of course be open to discussions if it was for a legitimate emergency like you had to get back home or something.
And then there will be a $250 "early exit" fee and this web site will be toast and the airlines will be happy again.
Can someone explain the harm this causes the airlines? I get there's a bit of an opportunity cost because they'll have an empty seat, but apart from that? I feel there's something more here
That's not a loss; it's just not an opportunity to double dip. The buyer still bought the seat. There's just nobody in it.
This sounds absurd. This is the best analogy i've come up with: A Sandwich shop sells half sandwiches at 5$ and full sandwiches at 6$ You, and a friend would both like half a sandwich. Instead of ordering two separate halves. You order only 1 full sandwich and cut it in half yourself. Now the sandwich shop is suing you because you paid $6 for one sandwich, and only ate half of it. That's instead of paying 10$ for two…
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I wonder. Do you sign any agreement that prohibits hidden city routing when you buy the ticket? If so, on an ethical level, it's not the same as the sandwich buying scenario, where you are not signing any additional agreement. I wonder what I would do if I were the airline. Obviously the simplest thing would be to suspend the return ticket, but I suppose that the return ticket would typically be booked on a different…
Do you sign any agreement that prohibits only eating one half of a sandwich? Would any such agreement be reasonable if buried in a dense online ordering click-wrap?
Comparatively, the duties and rights regarding a physical good like a sandwich are fairly simple -- it behaves like most simple physical goods. You buy it, then you can do what you want with it. Airline tickets are unlike this in a variety of ways. Hidden city routing being prohibited would not, I feel, be qualitatively different than many of these other restrictions.