American Airlines (as well as Delta & United) introduced Basic Economy fares on US routes where they compete with ultra-low-cost-carriers, like Frontier or Spirit. You no longer get a seat assignment, a checked bag or even a carry-on, never mind food or drink! Now, facing similar price pressure on transatlantic routes from LCC competitors like Wow or Norwegian, American Airlines is considering to introduce Basic Economy fares on international routes!
American Airlines and other legacy carriers are facing tough competition on the routes between the US and Europe. The low-cost carrier have increased capacity by 7-9% per quarter and a price war has been going on for over a year, with frequent sales offering one-way fares as low as $69! I have reviewed the transatlantic LCCs – and given the poor service on the mainline US carriers, you get great value from these airlines! The US3 all have fought back and as a result, fares across the North Atlantic have dropped to historic lows – and the yield (a measure of average prices) has dropped precariously for American Airlines!
European legacy airlines have fought back by starting their own low-cost subsidiaries, British Airway’s parent IAG just launched Level and Lufthansa is growing Eurowings! Some Asian carriers, like Philippine Airlines, have taken a hybrid approach where they are offering LCC service as one “cabin class” on their planes – with very mixed results!
American Airlines now is considering to take the latter approach and introduce Basic Economy fares on transatlantic routes. While you still get a seat assignment, one check-in baggage and food & drink on every economy flight to Europe, those might become add-ons you have to pay for in 2018!
I fly LCC regular on short-haul flights in Asia and Europe and don’t mind doing it on flights of 4h our less – I save a lot of money and make my experience better with PriorityPass lounge access and by purchasing premium seats or early boarding.
I have doubts about introducing Basic Economy on mainline flights, because I believe it does (irreparable) damage to the brand: The flight experience not only suffers for the passengers on the lowest fares (who typically don’t care about the experience and just want the lowest price from A to B), but also for premium passengers on the same plane! I don’t mind (as much) the chaotic boarding process, hold-ups due to handling of excess hand-baggage or stressed out flight attendants when I paid a few bucks for that flight. I’d be a lot less accepting if I had paid a fortune for a business or first class ticket and are subjected to the same experience. And given the poor service on the US3 as it is, I wouldn’t want it to get any worse than it already is!
Let’s hope American Airlines changes their mind and doesn’t introduce Basic Economy fares on international flights – or flying American Airlines will become worse for everybody….
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You can find more details on this story at Skift!