Southwest to Stop Overbooking as United Uproar Echoes

Re:Southwest to Stop Overbooking as United Uproar Echoes by maccard on Thursday April 27, 2017 @05:40PM (#14214957)

The main budget airline in Europe (Ryanair) doesn't overbook flights, and as far as I am aware never has done. They managed a net profit of 1.4 billion dollars last year.

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Re:Southwest to Stop Overbooking as United Uproar Echoes by toyg on Thursday April 27, 2017 @05:58PM (#14215106)

Yep, the main difference in Ryanair's model is that basically all tickets are nonrefundable. This way, even if the plane leaves half-empty on the day despite being fully booked, it will have paid for itself - which is what should happen, really.

What you lose by renouncing overbooking is the ability to change your ticket without paying for it again (which is what happen with Ryanair - fees to alter bookings are so huge, it's cheaper to just buy a new ticket).

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Re:Southwest to Stop Overbooking as United Uproar Echoes by thesumofall on Thursday April 27, 2017 @06:07PM (#14215186)

That's not really an argument. Profits could have been even higher if they had leveraged overbooking. And some of Ryanair's tickets are certainly below marginal costs - making me wonder if really all fights pay for themselves that easily.

My guess why they don't use overbooking: it's really complicated. Both finding the right balance of overbooking as well as managing the procedures at the airport. Ryanair has simply decided in favor of simplicity forgoing some additional revenue

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Re:Southwest to Stop Overbooking as United Uproar Echoes by toyg on Thursday April 27, 2017 @06:26PM (#14215318)

> Profits could have been even higher if they had leveraged overbooking.

But risk would also be much higher - as you say, handling overbooking correctly is complicated, and when it goes wrong it can go very wrong. Ryanair didn't just renounce revenue, they renounced risk and the costs associated with managing that risk.

> And some of Ryanair's tickets are certainly below marginal costs

The operational word being some. Much-fanfared rock-bottom prices nowadays are very limited, and the cost of a seat goes up very very quickly after they're exhausted. The cheap tickets are now a marketing proposition for the real ones.

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Re:Southwest to Stop Overbooking as United Uproar Echoes by maccard on Friday April 28, 2017 @08:10AM (#14218731)

Even their normal ticket prices are regularly cheaper than their competitors. I fly a short hop once every six weeks or so (edinburgh to Dublin - maybe 40 minutes). Even the full price tickets for the flight are almost always cheaper than their only competitor on the route (aer lingus). I've noticed this on other European flights too, where they are often 40-50 euro cheaper than their competitor.

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Re:Southwest to Stop Overbooking as United Uproar Echoes by corford on Thursday April 27, 2017 @06:21PM (#14215280)

Ryanair are running at >90% seat capacity across their routes, without overbooking. Not sure the complexity of introducing it would be worth the gain given their load factors.

Edit: then again, with their relatively recent business plus fare (which allows ticket holders some flexibility), who knows...

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Re:Southwest to Stop Overbooking as United Uproar Echoes by gizmo385 on Thursday April 27, 2017 @05:43PM (#14214989)

If I remember correctly, neither does JetBlue?

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Re:Southwest to Stop Overbooking as United Uproar Echoes by sushid on Thursday April 27, 2017 @05:47PM (#14215030)

Edit: technically true but this fact is misleading. JetBlue's rate of passengers denied boarding is actually almost 3 times higher than United. [0]

[0] https://www.transportation.gov/sites/dot.gov/files/docs/reso...

Oct - Dec 2016 Passengers Denied Boarding by U.S. Airlines. United's Denied Boarding is 0.40 per 10k passengers vs JetBlue DB of 1.19 per 10k passengers.

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Re:Southwest to Stop Overbooking as United Uproar Echoes by rdl on Thursday April 27, 2017 @05:53PM (#14215073)

JetBlue doesn't overbook, but they do swap A320 for A321 which have 50 fewer seats, fairly randomly, which leads to a lot of IDBs (you can ask for volunteers and get them when it's 1-5 people on a 200 person flight; you are probably screwed if you need 50 people on a 250 person flight.)

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