One of the interesting things that occurs in the world of airfares is revenue management and the impact of routing rules and airlines in the overall travel experience.
If we take for instance AMS-NYC (Amsterdam to New York), a route that can be driven by several factors...
Here is a trip report on KLM from Amsterdam to New York
From New York to Europe on United
If we take for instance AMS-NYC (Amsterdam to New York), a route that can be driven by several factors...
- The dominant carrier is KLM, which being based in Amsterdam has the benefit of being front-of-mind for many local passengers, who naturally might gravitate towards airlines that are viewed as "home-based" or "local".
- Other airlines need to compete to try to obtain the patronage of these local passengers and might offer lower prices even for non-stop flights to try to gain these Amsterdam based passengers...
- Across the Atlantic, most airlines that are part of the same alliance such as Star Alliance (which includes airlines such as United, Lufthansa, Austrian, LOT) or OneWorld (which includes American Airlines, British Airways, Iberia) or SkyTeam (Delta, KLM and a variety of other airlines) participate in what are called JBA ( joint business agreement ) which make the flights metal neutral for the airliners. The airfares on the route and pooled together, expenses are deducted and the profit is shared among the airline proportionally to the passengers transported. So in English, if you fly Lufthansa or United the fares are usually the same, the airlines do not distinguish to certain extent the unique passengers...
As you can see both LH (Lufthansa) and UA (United) have published the same fare "PNNZWWW" for travel between these two cities.
How does this reflect on normal travel? If we take a sample flight in February, purchased more than 30 days before the flight...
Ex. Amsterdam to New York on February 9 returning on the 14th.
But if we are to insert a flight on Lufthansa via FRA (Frankfurt) and still have a non-stop return flight from NYC to Amsterdam (AMS) the price drops to just 1820 USD.
Interestingly if one were to fly the non-stop flight on United on that day has no P class availability so only prices out at the full J price or an "absurd"... 6605 USD which is reduced to 1820 USD on other days...
The main point here is that airlines that are not based in the home city can and usually will under-price local rivals...
Related Links:
Here is a trip report on KLM from Amsterdam to New York
From New York to Europe on United
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