Home Airlines Sometimes I Really Don't Understand Airline Pricing

Sometimes I Really Don’t Understand Airline Pricing


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Most readers have probably seen examples of airline pricing that’s gone completely crazy because someone, somewhere, put a decimal point in the wrong place or because a currency exchange calculation has been done incorrectly. But this post isn’t about one of those error fares. It’s about fares that are being intentionally published for travel between the UK and the United States.

As I type this, the United States is no closer to opening up travel for passengers originating in most European countries than it was 6 months ago and various European countries are slowly reimposing restrictions on travelers originating in the United States. That makes it not all that surprising to find out that transatlantic passenger loads are not what airlines would like them to be and we know that loads are low because barely a day goes by without the airlines reminding us of their plight.

With all that in mind, logic would appear to dictate that airlines like British Airways and Virgin Atlantic (both of whom rely heavily on transatlantic travel) should be doing whatever they can to fill their cabins with people who are still able to cross the Atlantic with relative ease and who are profitable for the airline – premium cabin passengers. That, however, doesn’t appear to be the case…at least not if you look at what the airlines are charging for Business Class for departures from the UK.

If you take a look at what British Airways is currently charging for September/October roundtrip travel between New York and London, you’ll find that Business Class fares are more than reasonable (by this route’s standards):

If, however, you take a look at what British Airways is wanting to charge passengers originating in London, these are the fares you’ll see for the same dates:

Even the cheapest fares are over double the price of the fares originating in the US.

Virgin Atlantic is no better. In fact, its fares are worse.

It’s important to note that this isn’t limited to just the London New York route. London to Miami is vastly overpriced by both carriers…

…as is London – LA

…and as is every other UK – US route that I checked.

The prices appear to improve from November onwards, but for the next two months (the months in which we expect to see the most restrictions in place for transatlantic travel), both BA and Virgin Atlantic are trying to charge outrageous fares for travel originating in the UK. Why? I genuinely don’t understand this.

If demand is as low as we keep being told it is and with little sign that things are going to get any better in the next two months, why are BA and Virgin publishing such incredibly high fares for travel originating in the UK?

In “normal” times, we’re often told that last minute airline fares are expensive as these are aimed at people who have no option but to travel at a moment’s notice (e.g. corporate travelers), but with very few people being forced to travel right now, such a passenger doesn’t really exist. So who, exactly, are the fares aimed at?

The seat maps for BA’s two flights to Los Angeles today currently show 13 and 16 Business Class seats unoccupied (respectively) while Virgin’s single flight shows 9 available Business Class seats so as seat maps on the day of travel are generally reasonably good guides to an aircraft’s load, we don’t really need any more proof that neither airline is filling its Business Class cabins…so why are they pricing out anyone looking to originate from the UK?

Does anyone have any insights?

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2 COMMENTS

  1. What makes it even harder to understand is that I would expect there to be less demand for a round trip from London. As Brits aren’t allowed in the USA at the moment, it will almost exclusively returning Americans, and as such would be less likely to want a return ticket from London, unless they are here long term. Covid testing is also a deterrent to some.
    On the other hand you potentially have American tourists who can book for London, with no test requirements?
    Whatever happened to the law of “Supply and Demand’?

  2. Low fares can’t stimulate demand out of the UK so no point, may as well get what you can from the “must travel” traffic. Ex-US a different story as the border is open

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