It’s been official since last September that Virgin Blue is looking at less legroom for the cheapest seats and more for those on more flexible fares.
And it isn’t alone in looking for different price point and value options.
But will individuals or those who control company travel accounts really pay more for the extra centimetres that mean the difference between bone pain and a tolerable flight?
It’s a difficult question for airlines, especially if you run into sub sets of individual business travellers, company travellers, and leisure bargain hunters who not only disagree over this, but will contradict themselves by going for say tight-and-cheap between Sydney and Melbourne, yet pay more for Melbourne-Perth or Sydney-Darwin.
All airlines aim to fly as standardised a configuration as possible within their fleet of any particular type of airliner, like the Boeing 737-800s common to Qantas and Virgin Blue, or the A320s of Jetstar and Tiger.
However regardless of how the airlines sort out those conflicts, what do ‘we’ the travelling public really want or think?
There is a simple, but unfortunately too simple, way of looking at the chances of getting decent legroom for a really small increase in a ‘cheap but painful’ fare.
For example, if Virgin Blue or Qantas took a block of eight rows of six across seats in one of their 737-800s and replaced them with seven rows they could on the simple maths give 42 seats at least 10 cms more legroom than they previously offered to 48 seats.
So, still thinking in simple terms, they could get as much from say 42 seats at $80 one way between Sydney-Melbourne (before the taxes and levies which remain the same regardless of the fare) as they would from 48 torture tubes for $70.
But NO. Apart from the fact that neither carrier is likely to want to sell so many seats so cheaply per flight, and especially at peak times, the extra legroom option is most likely going to be offered at the ‘flexible’ read higher priced range which is where the battle for frequent flyers and those with a higher discretionary spending disposition reside.
Consider the two screen grabs below for Qantas and Virgin Blue flights between Sydney and Melbourne next Wednesday that were valid when they were captured off their booking sites this morning.
If we assume that both carriers could seriously consider a better ‘fuller’ fare economy offering in which one row of seats in eight was sacrificed for more space in that money zone, Qantas would be hypothetically offering 42 seats at $353 instead of $309 using its middle value fare, or a reasonable premium of $44 one way.
Using $280 for the middle Virgin Blue fare, it would rise an also reasonable $40 to $320 to recoup the loss of a row of seats in the same type of jet.
(For argument sake the fixed fees and levies component has been ignored.)
But in the mind of a price driven corporate account manager and in the individual discretionary spend market like today’s the value equation is not an extra $40-44 for a short sector, but the difference between the pain free fare and the lowest available fare each carrier has posted.
In the case of Qantas, the hypothetical difference is between $353 and $129, or an extra $224, and for Virgin Blue the difference would be between $320 and $79, or an extra $241.
Guess what? It would be very hard for either airline to get customers to think of the smaller surcharge than one based on the difference with the cheapest fare they had been offered in the same general part of the day, where the price gap would become even larger than it is now.
It would also drive more travel account managers and individuals to reconsider bone pain, and put Jetstar and Tiger up on the screen, as shown below.
For Qantas and Virgin Blue, and many carriers abroad, this issue raises the problem of a configuration that might work really well between say Chicago and Los Angeles or Perth and Sydney, but impede fleet flexibility by being inappropriate for the Gold Coast to Sydney or Chicago to Memphis.
The issue of better amenity offers on long haul international flights is fundamentally different than on domestic routes, with a growing number of carriers, the most recent including Air France and Cathay Pacific, moving to premium economy offerings in fixed cabins, as already found on Qantas and V Australia.
This person is in the minority, according to travel forums, in believing surcharges for exit row seats on long haul flights are a bargain.
Here’s a domestic hypothetical to ponder. According to Tiger Airways in its year to March 31 financial report, its average fare across its 180 seat A320s was $SIN 80.50, or $A 67.95 at Friday’s rate.
If it pulled five seat rows, or 30 seats, from those jets and charged an average of $81.54 instead (ignoring taxes and levies) to compensate for the reduced capacity, imagine the havoc a single class, 150 seat A320 with the roomiest economy cabin in Australia might cause.
Competition advances the most strongly through disruption. This would be disruption on a significant scale, even with a mere 9 jets in Tiger’s Australian fleet.
It would also save the cost of one cabin attendant per sector, and result in a jet that would be a lot easier to quickly turn around between flights than a 177 seat Jetstar A320.
But it won’t happen. At least for a while.