Quite the opposite as I see it. All the points earned from partners, including the huge number of points from Credit Card partners, are purchased from QF by the partner. This is a huge source of income for QF. Then remember that unlike many other loyalty schemes, QF FF points cannot be transferred out to another program, so QF does not have to pay anyone else if we chose to use QF FF points to purchase someone else's points.jazzop said:FF points are a HUGE cost to Qantas. They are a liability that they have to hold on their books.
And if QF get their yield management right, the FF awards (we can only use our QF FF points for free award flights or upgrades) should be minimal incremental cost to QF, by filling otherwise empty seats.
Meanwhile, as we sit on our huge FF account balances, QF has the benefit of the cash paid by their partners and have already accrued the points costs from the fares we paid for flights flown. This "cash" is then available to QF to invest in their airline while we sit and watch our points devalue.
I think QF are winners from the FF points, not sitting on a liability. FF points were not seen a liability by the Ansett administrators. How much compensation was paid to Ansett FF members for their FF points balance through the receivers? FF points are a cash injection for the airline, not an outstanding liability.
I think the program changes (read points devaluation) was a direct response to the successful promotion of points-earning credit cards, where people who fly very infrequently were still able to accumulate large points balances and hence valuable rewards on QF. Remember that the FF program is supposed to instill customer loyalty and hence part of the reason for providing valuable rewards such as long-haul international premium cabin flights or upgrades is to recognise and promote customer loyalty. I think QF were finding they had many FF members with large points balances earned through Credit Card or magazine purchases and very little flying loyalty. So they looked to realign rewards with actual flying loyalty - hence all international upgrades are now waitlisted and cleared based on FF status. Though I will reserve judgment on the success of that part of the changes until my first upgrade waitlist after May.jazzop said:Imagine how many points us FF members have stored away for a rainy day. With this change I estimate that points have been de-valued overall by around 20%, not a bad way to reduce your liabilities and costs in one easy swoop. It must look really good on the bottom line, so I hope Qantas management are getting nice big bonuses for Christmas. It seems like a good short term strategy but as a shareholder as well as FF I question the longer term benefits.
This is not backed up by the official traffic figures. See here for the published October numbers. This shows that load factors on international (75.6%) are in fact lower than domestic (81.5%). On my last QF international flight (early December), only 2 of 25 J seats taken, and economy cabin was less than 50%, which shows how we can't rely on what we see on individual flights, but should be able to trust the published traffic figures.jazzop said:Qantas international are doing really well and all of my flights recently have been almost full in economy and business. Qantas domestic is another story. Using 767-300s, A330-2/300s and 737-800s domestically has added thousands of seats a day on domestic routes.
Yes, domestic capacity is up from 12 months ago. However, looking at the domestic financial year to date ASK numbers, there is almost no change from the same period 2003/04 and 2004/05. Of course this is not including JQ's 1687 ASK's, but none of them are on 767, A330, 738 aircraft and are using the aircraft previously operated by QF Link which are excluded from these figures. Remember also that several 762's have gone from QF service as A330's have entered.
For the same FY year to date comparison for QF mainline international, we see an increase of 17.3% for ASK.