Wow, two of the worst airlines merging

[Ivory Lee Spurlock]

Originally Posted by CLT4

It totally depends on the industry and you may manage a business where the ROI per employee is different. Here's how some of the justification for the $2,000 over $300 ticket can price out for an employer in lucrative industries (many global companies allow business class for any flight over 6 hours, especially international long haul):

Price delta between business class and economy is $1,700. Business class traveler can sleep on plane, reducing one night of accommodation in destination city in Europe, while Economy traveler needs to leave a day early to rest before work.

Hotel cost saved: $380
Food cost saved: $100

New price delta: $1,220

For return flight during day hours from Europe to North America, employee in coach does not work majority of flight due to angle of computer, space, privacy of company documents from other passengers, and ability to eat and work at same time. If employee flies business class, expectation is a full day roughly of 7 - 8 hours of work. If this senior manager / exec on the business trip makes $280,000 per year, their time is valued at roughly $1,166 per day.

You are paying that person $1,166 for their time on the flight that day whether they work or not. If they work, you can recoup some economic output from their salary and the extra $1,220 for business class could be worth it to have them work during the flight on a business class desk in privacy rather than sit the whole time watching movies in a cramped economy cabin. Say they used those 8 hours to work on the confidential pricing proposal for the potential client they just visited in Europe for a deal that could be worth $65 million. The $1,220 premium for business class is worth it if it keeps this high valued employee productive on the way home.

That makes sense. Still, I think it's a waste of money. I wonder if the high valued employee could trade his $2000 business class ticket for a $300 coach ticket and keep the $1700 difference for himself.

[davebarnes]

We are retired and pay for our business class tickets with money and Avios.
We scheme to get the Avios and our upcoming trip on BA of DEN → LHR → AGP and then LHR → DEN is $2000 + 220000 Avios.
Part of the return is on Iberia of MAD → LHR for $600 cash for two. It is only a 2 hour flight but we have the money to sit up front.
We will not sit in steerage.

[BarryK123]

Originally Posted by Ivory Lee Spurlock

What do they get that the rest of the passengers don't?

The main thing is a lie-flat cubicle with more space/privacy. Some airlines are better than others with layout and amenities. Food is better (not that anyone would do it for the food), free booze, greater luggage allowances, etc

Originally Posted by davebarnes

BA DEN → LHR
$300 steerage
$700 premium economy
$2000 business, but I have seen business as high as $6000

I just returned yesterday from a trip to SE Asia. Flew to Hanoi via Tokyo and home from Bangkok also via Tokyo. It was the most expensive biz class flight for me to date - $6800 RT, but for about 17 hours of flight time, it was worth it to me. OTOH, I'm doing a trip to Italy in the Spring at it was about $3700 RT biz.

Biz class is like having power windows in a car. Once you do it, it's hard to go back For domestic flights, I fly biz if the flight is longer than 4 hours (so basically DEN to east coast).

[Mike from back east]

Merger has been called off. Not going to happen.

Excerpt of NY Times article:

JetBlue said it would pay Spirit $69 million to terminate the deal, which federal antitrust regulators blocked.

JetBlue Airways and Spirit Airlines announced on Monday that they would not seek to overturn a court ruling that blocked their planned $3.8 billion merger. The decision is a big win for the Biden administration, which has sough to limit corporate consolidation.

Backing out of the agreement will cost JetBlue. Under the terms of the deal, it has to pay Spirit a breakup fee of $69 million and Spirit’s shareholders $400 million.

A federal judge in Boston blocked the proposed merger on Jan. 16, siding with the Justice Department in determining that the merger would reduce competition and give airlines more leeway to raise ticket prices. The judge, William G. Young of U.S. District Court for the District of Massachusetts, noted that Spirit played a vital role in the market as a low-cost carrier and that travelers would have fewer options if JetBlue absorbed it.

The Justice Department hailed the termination of the deal on Monday, calling it “a victory for U.S. travelers who deserve lower prices and better choices.”

In the late 1970s I was a student of transport regulation when the Federal government was not concerned with lower air fares. The government was concerned that commercial airlines had sufficient profitability to invest in expensive planes, ground operations, and operate safely as the airlines performed their mission as regulated utilities serving the public need.

To this day Federal and state utility regulators (gas, electric, water) make sure these firms provide reliable service, safe water, and make a enough profit to generate dividends to shareholders in the 4-6% category. But for airlines, railroads and trucking they threw the baby out with the bathwater.

I will tell you that lower prices AND better choices are mutually exclusive; you can only get what you pay for. If you want lower prices then you get minimal everything (the cattle car experience) and for everything above that you pay various fees. Period.

[City Guy997S]

Originally Posted by CLT4

1.) Person has the disposable income to afford a $2,000+ ticket
2.) They value comfort
3.) They want to sleep on the flight in a lie flat seat and arrive in Europe rested to begin a full day
4.) They put a value on the services offered in business class (access to an airline lounge, showers, food in the lounge and in flight, et...)
5.) They don't want to sit close to other people
6.) Your employer or client is paying for the ticket for business travel

Example: If you are a business traveler, the $1,200 premium for business class can be worth it if you can bill it to the client or recoup the cost on efficiencies (i.e. less hotel nights). You depart at 5:15PM, have a full meal in flight after takeoff, go to sleep in your lie flat seat, land at 9:25AM, and do your first business meeting in London around 12PM meeting the client for lunch, afternoon meetings, et... If you flew economy, you probably did not sleep well during the flight and are exhausted at 9:25AM when you land in London and are not ready to present / be in front of a client. You thus would need to leave a full day early so you can rest and be professional / ready for meetings. This accrues a full extra day away from home, an additional hotel night in London (say $380), additional lunch, dinner, and breakfast meals, (say $100) that starts to close the gap on the fare difference.

Bingo! Someone else paying the actual bill

Originally Posted by Ivory Lee Spurlock

What's the big advantage of traveling business class that makes it worth paying $2,000 to $6,000 for a ticket when a ticket to the same destination can be bought for $300 to $700? That makes no sense to me. Make it make sense.

Worst part, you get there at the exact same time!

[City Guy997S]

Originally Posted by davebarnes

We are retired and pay for our business class tickets with money and Avios.
We scheme to get the Avios and our upcoming trip on BA of DEN → LHR → AGP and then LHR → DEN is $2000 + 220000 Avios.
Part of the return is on Iberia of MAD → LHR for $600 cash for two. It is only a 2 hour flight but we have the money to sit up front.
We will not sit in steerage.

I know an accountant that used to live in trailer. He drove junk cars until he inherited the firm. Now its big wheel time, base model Lexus and first class travel (when he can write it off). Guy is 5'8 260+ so fat guy in a little seat doesn't work.

I've bought first class tickets when it make sense but: "the real ballers fly private!"