Love ’em or hate ’em, you have to give ’em credit: Spirit and its ultra-low-cost kin are changing the way airlines do business.
Spirit’s so-called Bare Fares—no-frills fares stripped of such niceties as advanced seat selection, changeable tickets, and frequent-flyer miles—have already been copied by Delta, in select markets where the carrier competes head-to-head with ULCCs.
American recently announced that it plans to roll out its own version of the unbundled fares sometime next year, noting that air travel is increasingly viewed as a commodity, with price playing a leading role in the purchase decisions of fully half the airline’s customers.
And true to its role as the industry’s market-follower, United is the latest mainline carrier to signal its intention to go down the no-frills road as well. As reported by FlightGlobal, the airline’s senior vice president of revenue management disclosed United’s plans to offer unbundled fares in a conversation with a Credit Suisse analyst. No details were provided, but it’s easy to imagine the pressure on United to be price-competitive at its Denver hub with Frontier, for example.
So, probably by the end of the first quarter of 2016, travelers can expect to have access to no-frills fares on the Big 3 airlines, at least in markets where they compete against Spirit, Frontier, Allegiant, and so on.
Lower Fares, More Choice, and …
Lower fares and more choice: How can you argue with that?
While bare fares may be compelling in theory, it should be borne in mind that Spirit and Frontier are among the most-complained-about U.S. carriers. And among the most frequent complaints are those bare fares, which often prove to be illusory. Once the fees are factored in, flyers often find themselves paying as much as they would on a full-service carrier, for a notably shabbier experience.
And then there’s the more general concern, that the trend portends a race to the bottom, or at least a hollowing-out of the great middle. A company can’t be all things to all customers. Catering to the most price-conscious segment of the market necessarily diverts resources away from other customers. And since the airlines can’t afford to disenfranchise the high-profit travelers in business and first class, the likely losers will be coach-class travelers who traditionally buy discounted economy tickets. In other words, the great majority of flyers.
Cheap comes at a price.
Reader Reality Check
Are you looking forward to bare fares on the major airlines?
This article originally appeared on FrequentFlier.com.
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