Big U.S. airlines measure the success of their cheapest, most restrictive fares by how many passengers pay up to avoid them.
American Airlines next month is easing a key restriction of these so-called basic economy tickets — a ban on carry-on bags in the overhead bin — for travelers using its cheapest domestic tickets. The change, set for Sept. 5, makes these tickets look more like rival Delta Air Lines’ basic economy product.
“There are other features of that product that we think will continue to provide us sell-up rates,” Kurt Stache, American’s senior vice president of marketing, loyalty and sales, told reporters at the Boyd Group International Aviation Forecast Summit in Denver. “We think it will be in the 50 percent range.”
Passengers on these tickets still won’t be able to select a seat in advance, make any changes to their tickets or upgrade. They also board last.
The price difference ranges, depending on the route. A flight search for mid-September between Miami and New York’s LaGuardia Airport showed basic economy at $2 cheaper than regular economy while the fare difference was $50 between Charlotte, North Carolina, and Los Angeles for the same dates.
American’s upsell rate had been about 60 percent, but Stache said the airline didn’t want to offer the product at all in many markets because it wasn’t competitive against basic economy tickets that did offer a full-size carry-on and a personal item. American will likely expand basic economy tickets to more routes, Stache said.
United Airlines, which like American, launched basic economy on domestic flights last year, only allows those passengers a personal item that fits under the seat in front of them.
United’s president, Scott Kirby, declined to say whether the airline is considering removing the carry-on bag restriction for its domestic basic economy product.
