At the Qatar press conference on January 12, 2016 in Beverly Hills, with LAWA Director Deborah Flint, His Excellency GCEO Akbar Al Baker, and Qatar’s VP for the Americas Gunther Saurwein (L-R) – Photo: John Nguyen | AirlineReporter
Qatar Airways held a press conference on Tuesday to highlight the carrier’s entry into the Los Angeles market, with His Excellency, Qatar Group CEO Akbar Al Baker, providing his insights into the new service, as well has having some choice words regarding what he views as an unwarranted attack on his airline by the three big US-based carriers. AirlineReporter was on hand to live-tweet the event, and Al Baker did not disappoint.
A brand new 787-9, my ride to Santiago, Chile – Photo: Ben Granucci | AirlineReporter
I recently made a trip to Santiago to cover the opening of LAN’s new VIP Lounge. I was pretty excited since this gave me a few firsts. This was the first time that I was invited to do an international trip as media and my first time in South America. This was also going to be my first trip on a 787 of any variant. While the Santiago to JFK route was normally flown by a 787-8 at that time, the night before my flight I discovered that a brand new 787-9 had been swapped in. I was beyond excited!
The bulkhead row of seats on LAN’s 787-9 – Photo: Ben Granucci | AirlineReporter
Although I would say that I had a better than average international economy experience, it doesn’t mean that I didn’t encounter some challenges. Some were things that happen just because the complexities of running an airline, but others I think could be updated to improve the overall economy passenger experience.
Not every airline, nor every customer, is wanting to try to go bigger and better, like Singapore’s new Business Class.
I recently ranted about how people get what they pay for when it comes to air travel, but I feel that I have a few more things to say. I have come realize that there is downgrading trend going on in the industry that needs to change. Let me explain.
What if you get to a situation where increasing volumetric efficiency becomes done for reasons other than combating cost? After all, a business is in business in order to make a profit. It’d be irresponsible to not seek greater margins, right? Especially when passengers are already prepared to accept pain in economy class.
What’s sparked my continued rant is that I am starting to worry that European-style business class may be getting a foothold in North America.
When I was studying in Australia on the minutiae of airline management, it was drilled into me that airlines had three levers they could adjust to control their relative profitability: price, product, and capacity.
Norwegian Air Shuttle economy class on a Boeing 737 – Photo: Boeing
It makes sense. Do not get me wrong, this is true – but even then I knew it was a gross over-complication. It only really made sense in the premium cabin, where passengers made their airline selection on a factor other than pricing. Airlines don’t actually deal in seats; a seat is kind of a nebulous thing that cannot be quantified easily.
Airlines deal in unit cost and unit revenue. You’ve all probably heard the term CASM (Cost per available seat mile) thrown around, same with RASM (Revenue per available seat mile). Well, when you buy a seat, you are buying capacity on the flight at a specific fare.
It gets worse, because the available seat mile is extremely perishable. It’s gone, forever, once you close the door. There are a good deal of complex price discrimination strategies employed by airlines to ensure that their customers never pay less than they ought to – but before I hurt your heads with complex math and graphs, allow me to completely change the tone of my argument.