Distressed Inventory – How Do Airlines Get Rid of Seats?

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ozfflyer

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have been looking at flights to EU & USA/Canada for next school holidays starting around mid November.

There seems to be reasonable loads end of November to around 20 December & again 1st week of January, but outside those periods, many flights seem to be only 1/3 to 1/2 sold, which is very low only 3-4 months out.

Hard to cancel flights, as might have decent loads in one direction only.

With school holidays in Qld( & Vic I think) starting tomorrow & NSW in a week & most airlines having crazy numbers of seats unsold for the long school holiday period, what do the yield managers do ?

Do they

1) offer agents more commission? (heard that something like 65% of international tickets ex Australia sold by agents - not sure how much of that is online)
This would be self defeating if all airlines did it

2) dump prices further to public? (already doing that in many cases & not working - some airlines have student fares, under 31 fares, teacher fares) or to the industry ?

3) offer long payment terms by credit card at no interest, where pax might even be paying off their airfares after their trip.

4) all of the above

5) or something else, like free stuff, eg. credit for hotel/cars/trains/theme parks etc. etc. Obviously if pax aren't going anywhere at present, none of these entities will be selling anything.

or 6) offer individual travel consultants incentives like, sell $x of us get free flights somewhere, with a fall back if someone sells just short of the mark.

Many marketing managers are probably under the age of say 45, who were 18 during the last recession & have no idea how to handle recessionary trends.
 
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I would suggest 99% of students & teachers would have booked any long haul flights 6 months or more ago. Look at sta travel, they have special deals with quite a few airlines for teachers/student fares which are often much cheaper than adult fares.


You have tremendous faith in the organisational ability of most teachers and students. 99% seems an awful high number. Not everyone is wired the same way to organise well in advance, many are wired to do things at the last minute, and others will take advantage of deals at the last minute. Humanity is wonderful in its diversity (and here I'm talking about diversity in personalities, not any other trait).
 
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You have tremendous faith in the organisational ability of most teachers and students. 99% seems an awful high number. Not everyone is wired the same way to organise well in advance, many are wired to do things at the last minute, and others will take advantage of deals at the last minute. Humanity is wonderful in its diversity (and here I'm talking about diversity in personalities, not any other trait).
rarely last minute deals on long haul flights in peak season. Exception during GFC. If there are last minute deals, then that airline is probably going broke like Thomas Cook & alll the others that have gone belly up in last 12 months.
 
You have tremendous faith in the organisational ability of most teachers and students. 99% seems an awful high number. Not everyone is wired the same way to organise well in advance, many are wired to do things at the last minute, and others will take advantage of deals at the last minute. Humanity is wonderful in its diversity (and here I'm talking about diversity in personalities, not any other trait).


Not only that, but it's also making the assumption that both parents are teachers and have everything organised! I dunno how many double teacher-parent families there are out there?

As for students... assuming 99% of them booked months ago forgets (a) student laziness, (b) some students wait to see if they've actually passed exams, (c) student laziness.

(a) and (c) especially when parents are paying!
 
School holidays haven't started.

There is no recession.

Airlines go broke every year.

Pele.
school holidays actually started last Wed.

This is one massive recession.

Tell me one industry in OZ that isn't in trouble ?

Retail stuffed ?

Building/real estate stuffed ?

& many more airlines are closing down now than in past years.

& just got an email saying air asia is today doing AUD$199 return SYD/Madrid, which basically means they are giving away seats free, as govt taxes are around that figure.

 
Tell me one industry in OZ that isn't in trouble ?

Retail stuffed ?

Building/real estate stuffed ?

but those things don't necessarily = a recession :)

retail is 'stuffed' because retailers (a) don't give us what we want and (b) charge an 'Australia tax' and (c) take us for granted.

(a), (b) and (c) are getting resolved by the internet as we find the stuff we want, for the price we want. And as an aside - really annoying these days when you research on line but then get to the store to find either (a) they don't have the product even though they said they had it is stock or (b) the price is different to the 'special on line price'.

My local retailers complain no one is buying anything, but their hours are 10am until 5pm. This completely ignores the 1000s of people that pass their shops from 0730 in the morning and until 7pm at night on their way to/from work. Plenty of stuff I see in the window that i could buy from those local retailers but they just aren't open when I want them to be.

i look at the prices of TVs in the USA and I really don't believe it costs $300-$500 to put it in a shipping container (along with 1000 others) to get it out here. Or a vacuum cleaner (look at the cheap cost of a Dyson in the USA)

Building and real estate isn't stuffed, we've just created an unrealistic price bubble, and greedy builders are putting up buildings so fast that cracks are appearing or (b) using cheap cladding or (c) winding up after they have completed the building so when you go back to get them to fix the problems they're no longer accountable.

The Aussie government and reserve bank keeps telling us the lower Aussie dollar is the best thing that can happen... but then we see higher prices, and overseas holidays become unaffordable and so we stop spending. That doesn't = a recession. That = people being fed up.

Oh, and the Australia tax again... with Air China offering $2200 return from Europe in business class, Singapore Airlines doing it for $3700, and Qatar for $3900... yet the absolute cheapest we can get it for from Australia is $4500-$5500... makes you think 'stuff them'.
 
but those things don't necessarily = a recession :)

retail is 'stuffed' because retailers (a) don't give us what we want and (b) charge an 'Australia tax' and (c) take us for granted.

(a), (b) and (c) are getting resolved by the internet as we find the stuff we want, for the price we want. And as an aside - really annoying these days when you research on line but then get to the store to find either (a) they don't have the product even though they said they had it is stock or (b) the price is different to the 'special on line price'.

My local retailers complain no one is buying anything, but their hours are 10am until 5pm. This completely ignores the 1000s of people that pass their shops from 0730 in the morning and until 7pm at night on their way to/from work. Plenty of stuff I see in the wondow that i could buy from those local retailers but they just aren't open when I want them to be.

Building and real estate isn't stuffed, we've just created an unrealistic price bubble, and greedy builders are putting up buildings so fast that cracks are appearing or (b) using cheap cladding or (c) winding up after they have completed the building so when you go back to get them to fix the problems they're no longer accountable.

The Aussie government and reserve back keeps telling us the lower Aussie dollar is the best thing that can happen... but then we see higher prices, and overseas holidays become unaffordable and so we stop spending. That doesn't = a recession. That = people being fed up.

Oh, and the Australia tax again... with Air China offering $2200 return from Europe in business class, Singapore Airlines doing it for $3700, and Qatar for $3900... yet the absolute cheapest we can get it for from Australia is $4500-$5500... makes you think 'stuff them'.
sounds like you weren't around or an adult during the last recession ?

It's a catch 22 in OZ. Everyone wants high wages or they will simply go on the dole & have a cash job on the side. You can't try on anything if it's online !!!

Whereas once you could try something on in a bricks & mortar store, not so easy now. Either store has gone or they got smart.

Look at Bunnings eg.

They say they won't be beaten on price, but many items at Bunnings are exclusive to them. A power tools model XYZ B(b for black) might be exactly the same as one at Mitre 10 XYZ G(g for green) but thay are not the same model number. You can only buy the black one at Bunnings.

It can also cost a fortune to return anything bought overseas.

Many retailers can't open when they want, as either locked into crazy shopping centre leases or restricted by govt regs.

Builders are going broke everywhere !!! Were they greedy or was it their suppliers ? Many traddies think they are brain surgeons, the prices they charge, but they are the 1st unemployable. Some builders just got sucked into ... real estate never goes down.

Who wants to fly Air China to anywhere ?


Singapore airlines are by far the worlds best airline, so pay more.
 
Air China has a perfectly acceptable business class product... a full flat bed, edible food, and simple wines and spirits. And a pretty good cabin crew. For $2200 you can buy your own OLED/QLED for home, and a case of the finest champagne to enjoy at your leisure, and still have a few grand left over for your next trip.

Singapore Airlines is charging $3700 (that's Aussie dollars) from Europe to Australia return business class, but up to $7000 doing it in reverse. And for what?

Thankfully most airlines seem to be getting a bit more realistic with their premium economy offerings... Cathay and the like now charging around $2600 return to Europe from Australia. but QF is still plugging away at $6000. You can fly cheaper in business class on many other carriers. QF can't blame lack of yields on a recession. It's that consumers are wising up.
 
Air China has a perfectly acceptable business class product... a full flat bed, edible food, and simple wines and spirits. And a pretty good cabin crew. For $2200 you can buy your own OLED/QLED for home, and a case of the finest champagne to enjoy at your leisure, and still have a few grand left over for your next trip.

Singapore Airlines is charging $3700 (that's Aussie dollars) from Europe to Australia return business class, but up to $7000 doing it in reverse. And for what?

Thankfully most airlines seem to be getting a bit more realistic with their premium economy offerings... Cathay and the like now charging around $2600 return to Europe from Australia. but QF is still plugging away at $6000. You can fly cheaper in business class on many other carriers. QF can't blame lack of yields on a recession. It's that consumers are wising up.
& Emirates are now offering stripped down business class. It's what the market can bear & the market is stuffed & will be for quite a few years. Business class fares are dropping as very few are buying business class now & many are trying to upgrade. Most airlines now, have some sort of bidding system, where you can buy an upgrade for $$$ not ff points. Airlines already have your points $$$ (retailers etc. have already paid airlines for them) so in a way, ff pts are devalued again.
 
But the point is we should need to have ‘stripped down’ business class, or bidding for upgrades. It costs the airline no more to fly you Europe-Australia return than it does the other way around.

The airlines are just trying it on, as you say..l ‘what the market will bear’.

Well, the market will no longer bear inflated prices to the USA or Europe.

That doesn’t = recession. That = a smarter consumer.
 
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But the point is we should need to have ‘stripped down’ business class, or bidding for upgrades. It costs the airline no more to fly you Europe-Australia return than it does the other way around.

The airlines are just trying it on, as you say..l ‘what the market will bear’.

Well, the market will no longer bear inflated prices to the USA or Europe.

That doesn’t = recession. That = a smarter consumer.
actually the recession is caused by dumb consumers. Paying too much for housing. Getting into too much debt. This recesssion is going to be the biggest ever & some still believe the media, who earns billions from advertising, that there is no recession. The only growth industry right now, is the public service, but that has to be reversed, as we can't afford about a million of them.

Airfares aren't always cheaper into OZ than out either. It's about time of year & airline.

Eg. Americans pay more to fly a U.S. airline to OZ, but U.S. airlines especially United are almost always cheaper than OZ flag carriers like Virgin/Qantas & sometimes even cheaper than poor old air NZ.
 
sounds like you weren't around or an adult during the last recession ?

It's a catch 22 in OZ. Everyone wants high wages or they will simply go on the dole & have a cash job on the side. You can't try on anything if it's online !!!

Whereas once you could try something on in a bricks & mortar store, not so easy now. Either store has gone or they got smart.

Look at Bunnings eg.

They say they won't be beaten on price, but many items at Bunnings are exclusive to them. A power tools model XYZ B(b for black) might be exactly the same as one at Mitre 10 XYZ G(g for green) but thay are not the same model number. You can only buy the black one at Bunnings.

It can also cost a fortune to return anything bought overseas.

Many retailers can't open when they want, as either locked into crazy shopping centre leases or restricted by govt regs.

Builders are going broke everywhere !!! Were they greedy or was it their suppliers ? Many traddies think they are brain surgeons, the prices they charge, but they are the 1st unemployable. Some builders just got sucked into ... real estate never goes down.

Who wants to fly Air China to anywhere ?


Singapore airlines are by far the worlds best airline, so pay more.
The last recession we had was the one we had to have in 1991...
 
Could you share the data you have that is not being reported that confirms a recession? You know, something that shows 2 consecutive quarters of negative growth? That’s the definition of a recession and what it takes for there to actually be one. Having some nobody on an Internet forum banging on ad nausium about it is not sufficient.

What we have is a very sluggish economy. Could it get worse and turn into a recession? Sure, of course it could and there must be a decent chance of that happening. But we aren’t in one right now.
 
I guess the argument would be that although the whole economy is not in recession, we are in per capita recession and only growing due to population growth. So each of personally would act like we are in a recession while the total number does not directly show that.
 
I guess the argument would be that although the whole economy is not in recession, we are in per capita recession and only growing due to population growth. So each of personally would act like we are in a recession while the total number does not directly show that.

No. The argument has been that we are in a deep recession which is worse than anything we have seen. This is obviously much different to what you describe above so I’d love to see some data on this, preferably some that apparently isn’t being reported.
 
Airfares aren't always cheaper into OZ than out either. It's about time of year & airline.

Nope. I'm quoting business class airfares. We have never had a $2200 business class fare from Australia to Europe. Or one for $3700 on Singapore airlines (or the equivalent worth of the dollar at any time).
 
I'm puzzled by your assertion that 'Teachers get cheaper fares..." They do? With whom? is that a fact or just another bomb chucked into this weird coolection of wide ranging assertions
 
So, shall we start by getting rid of the teachers seeing as you seem to denigrate them continually (some of your worst comments have thankfully been removed by mods)? Or maybe the nurses, bus drIvers, police, NDIS managers, firies, posties, hospital workers, public hospital doctors, mental health workers, meteorologists, ambos, planners etc etc - any more groups you despise?

I find your comments unsubstantiated, inflated, opinionated, simplistic and tedious.

actually the recession is caused by dumb consumers. Paying too much for housing. Getting into too much debt. This recesssion is going to be the biggest ever & some still believe the media, who earns billions from advertising, that there is no recession. The only growth industry right now, is the public service, but that has to be reversed, as we can't afford about a million of them.
 
I'm puzzled by your assertion that 'Teachers get cheaper fares..." They do? With whom? is that a fact or just another bomb chucked into this weird coolection of wide ranging assertions
sta travel - not with all airlines, but significant with some. Also student & under 31 fares less than adult fares

+ student flights or whatever they are called now
 
So, shall we start by getting rid of the teachers seeing as you seem to denigrate them continually (some of your worst comments have thankfully been removed by mods)? Or maybe the nurses, bus drIvers, police, NDIS managers, firies, posties, hospital workers, public hospital doctors, mental health workers, meteorologists, ambos, planners etc etc - any more groups you despise?

I find your comments unsubstantiated, inflated, opinionated, simplistic and tedious.
all comments are opinions !!!
 
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