> In this case, the rationale for charging solo travelers more is fairly clear: It's just another way for airlines to continue “segmenting” their customers, charging business travelers paying with a corporate card more while offering a better deal to families on the exact same flight.

I think the explanation is wrong and the author is jumping to conclusions. Airlines have long offered "bulk" discounts. Their goal is to fill as many seats on a flight as possible. What we are seeing here is their group pricing creep into their direct sales.

Airlines should grow up and start charging by weight just like carriers do for every good except passengers (flat rate shipping boxes excluded.)

Remember Accompany.com and Mercata and other group-buying websites from the 90's dotcom boom? Time for those again?

Curious if any others are priced out of traveling? I haven't seen family in 3 years.

Would this be allowed for international flights under IATA's fare rules?

I think they because so custom in their pricing that is becoming insane... I wish they are more predictable in how much things cost, it is almost like weather, how much will airfare cost.

Cell phone lines only $30/line when you buy six. What, you don't have a family of six? Weird.

I love how the author thinks they've discovered something super secret, when they have in fact just learnt about "Group Discounts".

Author will lose their mind when they buy 10+ of the same thing from AliExpress.

Good.

it truly is unfortunate how society punishes you for being single. Insurance, tax, credit worthiness, even health care.

i wonder how low birthrate societies like Japan or South Korea are like, is it worse to improve birthrates? or is it better because being single isn't an anomaly?

More importantly, the number of single/solo people isn't even low in the US. If i had to ballpark it, at least a quarter of the population is like that. Lots of married people travel solo for business for example. Why aren't some airlines playing capitalism well by offering "business elite" flights where solo travelers get a loyalty discount and there are no children on the flight? Not for all destinations but at least popular ones like to vegas or NYC <-> LAX.

Business does volume discounts. News at 11.

I never would have understood this as a young, single person. Now that I have a family there are several times per year where we price out the cost of a solo ticket for one parent, the price of taking one or two kids, or the cost of all of us going for something. Having a quantity discount would absolutely tip the scales for us for certain trips.

People will look at this as penalizing single travelers and want everyone to have the lowest fare, but that’s not the real alternative. A flat fare would bring solo prices down and group rates up so the blended average is the same.

In other news, gas stations are selling individual cigarettes for $0.50 each

Apparently the article author hasn't heard about the concept of a "group discount"

Is volume-based discounts really that surprising?

Airlines need to be regulated and treated like public utility which is exactly what they are.

Other G7 countries. Unlimited data is about $15 a month in the uk, 150G is even less

Like medicine, the price is a negotiation point in a complex web of probabilities. Air travel can be more transparent because the probability network is simpler and the spread is narrower, but they’re both dealing with realities of providing predictable service under volatile demand and group payer conditions.

Distance train at least may (or may not depending on location/country) be quite a bit cheaper for advance purchase but maybe doesn't fluctuate as much day to day.

This was prevalent until the early 2000s, it is far less common today. Corporate discounts used to exist based on guaranteed minimum legs in some time period. This ended when airlines discovered only flying full planes made them more money, making bulk discounts more pain that they were worth.

None of those are generally considered to be public utilities.

Public utilities include things like electricity, power, gas, sometimes telecoms. Being a monopoly is an inherent part of it.

Yeah, typically groups pay more per ticket than individuals.

This is probably only on unpopular routes where they know they aren't going to fill the plane.

> You've never seen a 2+1 free or 3+1 free pricing in stores?

Yes and as a solo person I can choose to buy those and take advantage of it in the same way a family can. Usually it's consumables like a 6 pack of bagels or something that might cost $5 which I'll 100% use.

This airline approach comes off much different, because as a solo traveler there is no benefit or reason why I would ever buy 2 tickets to save $80 per ticket since I wouldn't get any value from it and the cost of 2 tickets even with a discount will be greater than 1 non-discounted ticket.

Most airlines seem to also charge to pick your seats. I wonder if people who travel as a group end up paying that discount back to sit together.

Well I can't help you if you don't say which part you don't follow.

That doesn't make sense - the family in your example has 110 options whereas the single traveler only has 100.

provided you have someone to go with :)

Nonsense. The airline doesn't ask your marital/family status. They simply offer a bulk discount.

By your logic, Costco is also "discriminating based on marital/family status" by selling bulk at discount. Costco doesn't sell "buy 1/5 a toilet paper package, come back and get the other 4 1/5 later". They sell the whole package up front, use it or lose it.

That's how bulk discounts work.

Heck, you could say that a gallon of milk discriminates against you because you have to pay way more to buy a pint of it, and you can't "come back later for the other pints at the same price".

This is absurdism to the highest degree.

You are welcome to book flights with friends, or even organize a flight-share program and go in on flights with strangers. Bulk doesn't discriminate. I know folks who go in together on Costco bulk because they can't use it all. Make the system work for you.

That argument only makes sense if you see no inherent value in the child.

It's not even retirement.

When a 25-year-old lands a senior role in 10 years at 35, it's because someone else's 13-year-old grew up, graduated college, and got hired as a junior. Promotions are 10% Crushing It, 90% dumping your grunt work on some poor sap too young to know better.

Society is a pyramid scheme, and, like all pyramid schemes, bringing more people in is ultimately more valuable than actually selling the LuLaRoe or whatever.

For the privilege of using the hand-me-down data of carrier's network (i.e. getting deprioritized in any situation where the network is congested)

I’ve done hostel and like that option when there is a private room. I often/always travel with electronics and things that I want to feel comfortable leaving behind, and I don’t like leaving my laptop and game consoles unattended in communal spaces.

There’s a very big difference between sharing sleeping space with multiple complete strangers and sharing space with family.

You can’t freeze a hotel room.

What packs do you buy where it is much more cheaper?

Frozen > 5kg or so?

I've never run into such a thing across many years. I buy single tickets to Broadway/West End shows a lot of the time and I often land great tickets.

Would a van cost more to rent then a sedan?

For two reasons:

1. I don't want to stay in a hostel. See below for more on this; but, hostels, at least the ones I have researched, have bunk rooms and shared facilities. Hard pass for me.

2. I don't like sharing a bedroom and, especially, a bathroom in someone's home when they may be there. There's simply a different level of security (potentially false, I understand) in a hotel vs a rented room in a house.

It may have been 5 years ago or so, yes late 2020, when I had a ridiculous idea to visit Hollywood to see a concert. And I considered staying in a hostel in the area.

"Hostel" may mean different things in different parts of the world. When I was growing up, I heard about "youth hostels" that were mostly in Europe and mostly providing inexpensive accommodations to college-age people who were backpacking through the continent or had a Eurail Pass for traveling, etc. But I have never stayed in one.

When I surveyed a few hostels in Hollywood, it seemed that they were indeed targeting college-age people. Furthermore, they were cultivating a "package deal" atmosphere where there were day trips and coffee hours and programmed activities, for residents to do while they were there. And with limited privacy and shared facilities, there could be bustling activity and interruptions of sleep all night long. They did not seem like places to check in, crash overnight and leave in the morning. And that is probably calculated to appeal to the clientele who are not homeless and did not simply save up $40 by panhandling during the past week.

They do this in Mexico as well. Always just seems like an honor system thing unless they are checking people at the door to the hotel and/or room each time they enter, which only seems realistic in very small hotels who have no e.g. restaurant open to the public.

Otherwise can’t one just rent the room as a solo guest, and just have someone come through later, as long as there isn’t an obvious group activity going on inside the room?

It's probably a bit of a mixed bag. Beds are reasonable for two people (Usually a queen/king or a couple queens). But there may be only one sitting chair. Two people can manage but hotels split the difference a lot of the time.

The difference in costs between accommodating one person and two people is pretty minimal. Even things like breakfasts are prepared in bulk.

Most single people own and sleep in double beds, so there's no sense in which a double bed is "designed to accomodate" two travellers.

The issue is more that discounted single room rates would encourage unofficial double stays, which would lose significant income.

At least here in Europe there are plenty of hotels with solo traveller rooms (<=120 cm beds). But still not uncommonly priced at 80-95% of a double occupancy doublebed-room.

I often book a double for myself (often for the same price or €10 more) for a bigger bed.

I think even calling it "society incentivizing people to have children" is a bit of a stretch, since in most cases the tax advantages are unlikely to result in a net financial advantage given the financial costs of raising children. In most cases the thought isn't "I'm ambivalent about having children but I will do it for the financial benefits" and rather "I'd like to have children, but it's very expensive, and the tax advantages slightly lessen the expensive."

Single also differs from being in a childless couple e.g. in your early 20s.

To get on the ladder today, 5 years sharing rent is priceless. Then once you do, you get child benefits. Many people are single late in life too. So I don't think it's something you can equate.

>if you’re solo it seems like they expect you to buy 2 spots

Cruises are probably more complicated because they price things other than your cabin into the "experience." (Though I think the Queen Mary 2 a few years back was slightly less than 2x for just me.) But the random Marriott doesn't really care if there is one of you or two when it comes to pricing.

There are a couple travel agencies in Ushuaia that sell open cabins at steep discount for cruises heading across the Drake Passage. If you've got a little flexibility in your schedule, you can set foot in Antarctica for a lot less than if you bought a ticket anywhere else.

also: be sure to make offerings to the sea gods before sailing because crossing the Drake Passage can be... exciting.

Go to Ushuaia, and book a normal ship just like all other folks do. You will have 100x more rewarding experience from all of it, guaranteed. Its not just destination but whole road to it that make such trips worthwhile and you will keep remembering it for rest of your days.

Cruises are for folks, how to say it politely... who gave up on any form of adventure or excitement in their lives. Dont be that person, not yet at least.

Ships going to Antarctica often offer single beds in shared cabins.

When I went there, I booked the cheapest bed (maybe $6500 in 2013) in a three-person cabin. It was early season and the ship wasn't full, so the company filled it with backpackers waiting for last-minute discounts in the hostels of Ushuaia. Because I had paid the full price, they upgrade me two classes to a much nicer two-person cabin. And then halfway through the trip, the ship delivered some staff to a museum. The other guy got their cabin, and I got the one we had shared.

I just invited myself along on a "girl's cruise" to Alaska that my wife was doing with her friend (who's actually my second cousin). As the third person in the cabin, my fare only cost $99, plus some fees, compared the several thousand each my wife and cousin paid.

There were quite a few solo travelers we met on the cruise, though - I think they mostly had solo inside cabins with no view.

It is strange balance, but in cruising there is expectation that money is spend outside the base fare on extra experiences. So getting double money from double occupancy is important. Cost of basic food doesn't scale that much. And these extra revenue opportunities is also why occupancy beyond double is so much cheaper.

Ease is relative especially considering cost, but that's the kind of thing that having a good travel agent is good for (eg: finding someone with knowledge of where to stay in Chile and who to hire for a charter flight or boat trip). Economies of scale kinda kick in though so a cruise is probably the least expensive.

Cruises are selling a set space rather than a service or trip per person. The extra incremental cost is minimal for the second person.

Also the more people on the ship means more chances of selling high margin add ons like drink packages, excursions and so on.

Some cruise lines, like Norwegian, have specific solo travel fares and cabins and even social events just for solo travelers

Right, but the former hotel has half the capacity as the latter.

The point is multiple people sharing facilities get discounts. It’s nothing more sinister than that. The hotel charges per room, and rooms include facilities. The costs for the hotel don’t depend on how many people are staying in that room.

Right, but my point is that you're now no longer complaining about the concept of offering discounts for room-sharing. Now you're complaining that there's no one you would be comfortable sharing a room with.

Depends on region. In many places a hotel room for two guests has two beds that are either separate or together. So make sure you book a king size bed, and also buy one of those fake moustache-and-glasses for your wife so nobody suspects anything at breakfast. Or she can wait in the room and you'll sneak some scrambled eggs and bacon from the buffet in your coat pockets for her.

> you wouldn't be alive if nobody had children, so it's quite selfish of anyone to be anti-children.

It gets into philosophical territory, but the default "having a pulse = good" thinking is pretty shortsighted IMO. Life is inherently suffering and no one got a yes/no prompt before being born.

> Yeah I used to think that until I had a family.

It is amazing how blatantly people will just admit "I agree with politics that benefit me even if they exclude others."

> Taxes are more punishing because you're spending half your disposable income on children

I probably spend on my dogs what you do on your children. Gosh life sure is hard because of my decisions. Where are my discounts and tax refunds?

> It's called price discrimination.

...and when is discrimination ok? Lets all say it out loud.

Citation needed. In my experience it's entirely the opposite: it's nearly universal that hotels charge more for two guests than one.

You can easily verify this on Booking.com, where the search results show price per room and how it varies based on how many people are in that room and whether they're adults or children.

Nicer restaurants often won't accept reservations for solo diners, leaving them to come at off-hours or eat at the bar.

Obviously that's a pure economic thing you can't get mad at as tables are designed for 2+ and you're trying to get in during a high traffic time.

You can’t eat out alone everywhere

Yes, that's just a necessity for the persistence of a society. Otherwise there's no point in even organizing as one. I'm not making a value judgment by the way, just an objective statement. I was also once part of a "DINK" and someone who thought would not have children, I have no qualms with that, but there's just no point in prioritizing that segment.

Well yeah, because of our ingrained sense of morality & self-preservation. But we're talking about the policies of society so it's kind of pointless discussing them if you don't accept that society should exist in the first place.

Also... it's not society, it's the human species.

It's fairly irrelevant to the discussion. All societies that choose not to exist also choose for all their policies about (not) reinforcing children to not exist.

That's indeed a philosophical question. Should we even exist at all?

It's a strange thing of nature and evolution that it creates a species that can plan and execute its own intentional suicide.

This seems surprising to me. I was under the impression that airlines are pretty low profit margin industries, pulling in only around 3-4% in a decent year, and that of that the airline tickets themselves are the lowest margin items percentage wise, with other things like baggage fees being much more load bearing.

>Not only are they allowed to bill you whatever they want, they are never under any actual obligation to put you on the plane.

With exceptions, once you have paid for a ticket all commercial passenger airlines are obligated to transport you under their contract of carriage.

All airlines must do this, I even looked up the contract of carriage for the shittiest airline I could think of and Frontier has this to say:

>Involuntary -- If insufficient passengers volunteer, passengers who cannot be accommodated on the flight will be denied boarding and Frontier will provide transportation on a Frontier flight to the same destination. After a passenger’s boarding pass is collected or scanned and accepted by the gate agent, and the passenger has boarded, a passenger may be removed from a flight only for safety or security reasons or in accordance with Section 3 of this Contract of Carriage.

They must also compensate you. If being denied boarding delays you for 1-2 hours you get 2x the cost of the fare up to $1550 and 2+ hours 4x up to $2150.

And they still have to put you on a plane:

>A passenger denied boarding, voluntarily or involuntarily, pursuant to this section, will be transported on Frontier’s next available flight on which space is available and at no additional charge.

https://www.flyfrontier.com/legal/contract-of-carriage

Contracts of carriage are pretty much boilerplate but all of this is to say: if you pay, show up on time, and aren't denied boarding for a safety reason airlines are obligated to transport you to your destination.

(in the US)

> they are never under any actual obligation to put you on the plane.

It's true that airlines wield pricing power but their Contract of Carriage, buried under more fine print than a payday loan agreement, does impose obligations. Rule 21 of United's Contract explicitly allows refusal of transport, but Rule 4 confirms that a ticket with a confirmed reservation constitutes a binding agreement to provide service, absent violations by the passenger (like failing to check in). Rule 25 further mandates denied boarding compensation when overselling occurs, because even in brutal airline economics, a confirmed reservation isn't merely a suggestion, it's a contractual commitment, however creatively airlines may interpret "commitment." Of course, involuntary bumping, force majeure, and the ever-convenient "operational decisions" let airlines off the hook. But to claim they have no obligations is not true.

I’ve eaten alone in hundreds of places in dozens of countries, not sure where these mythical places are.

All I did was go to Expedia and put in JFK and CDG and $149 on Tuesday, July 15th on Norse Atlantic Airways popped up. Return flights the next week were $200-300. Round trip with a one-week stay were ~$500.

Round trips in September are $386-500 depending on the day and duration of the stay. The $386 fare was for a tuesday-to-tuesday week stay and I might just take it, I will be bumping up against use-or-lose limits for PTO by then. There are fewer crowds in September and the weather is really nice.

https://imgur.com/Wn43raL

Knowing Friedman's other takes, probably not.

That's actually exactly the consolation I look for as a consumer, thanks.

Sure, you would subside people flying with luggage. It also reduces the time planes stay on the ground, stops the fighting between passengers for the always full luggage bins, clears the seats in case of emergency, and eliminates the largest hidden fee companies manage to put on their prices.

Anyway, the fact that you just assumed I personally fly with luggage is weird.

Do you have any examples of a one way direct being more expensive than a round trip, with both of them sharing the same outgoing flight?

Isn’t it a waste to book accommodation and not use it? If it is a popular place, maybe they’ll give it to walkins or something, but otherwise?

Canceled flight is not canceled trip. For refundable trips at least, solo travelers are more likely to cancel and book another flight. Source: done this myself.

I've flown a good number of transatlantic routes with my family, and I've also flown over alone.

From my anecdata, being single greatly increases your chances of being bumped off a full flight. And it's a lot cheaper and easier to compensate/redirect one person than a family of four.

I suspect they also empirically have less price-sensitivity on average, for a variety of reasons

Changing/cancelling flights is not usually for free.

My anecdotal experience is that this sort of discount doesn't really exist any longer. At least it isn't obvious to me when I book for the most part. Saturday night stay discounts for flights used to be very pronounced.

Delta does.

But then if the plane is full you are stuck in a middle seat whereas, like gp pointed out, choosing window + aisle for a two-person booking almost always lets you fallback to window + middle or middle + aisle if the middle seat does get filled so there is really no risk in taking the chance.

It's definitely the case that a round trip going from A to B to A can have a very different price than a round trip going from B to A to B using the same routes.

> Pricing based on individuals sounds illegal.

It happens in every car dealership. And in enterprise sales. And in some countries in nearly every market and store.

>> In all honesty all this thread is people complaining about something they don't have a clue about.

Considering that I saw the same uproar on 4 major travel blogs: Thrifty Traveller (who originally reported this), One Mile at a time, Enilria and View from the Wing.

I'd hardly call it people complaining about something they don't have a clue about.

This pricing practice of charging more for solo travellers is new, deceptive and even travel bloggers who are thought leaders are upset by this.

HN comments vote need more than 40 minutes to stabilize

It's also literally in the article itself:

"It's just another way for airlines to continue 'segmenting' their customers, charging business travelers paying with a corporate card more while offering a better deal to families on the exact same flight."

In general markets are pretty good at arbitrage. If you can get a $50 discount for a product by doing X, someone is going to set up a service whereby they do X for you, resell the product for a $45 discount and put $5 in their own pocket. At which point nobody would pay full price to the original seller and the convenience fee for not doing it yourself is $5 instead of $50.

The problem comes when the original seller doesn't want their price discrimination scheme to be thwarted by efficiency-improving arbitrageurs and takes measures to prevent that, because that's rent-seeking behavior and shouldn't be tolerated.

Being the status quo doesn't change that it's an inefficient waste of resources. That's still true.

The airline wastes resources on their end, and so do the consumers. They're both doing what they're incentivized to do, but that's not what's actually efficient for society. The whole point of a good economy is that these two are always pulled into alignment (Efficient Market Hypothesis), but ours has failed in this case.

It was fascinating to chat with the software engineers at ITA Software.[0] Turns out flight routing (which everyone knows "should be" just a simple A*) is actually NP-Hard because of how convoluted the airline pricing systems are. At that company it was obviously a group of super smart people solving super hard problems..... and for what?

This is Kurt Vonnegut Jr's "Dynamic tension": muscles working against muscles, with no work being done. This is what Bullshit Jobs (good title, disappointing book) should have been written about.

To quote Eisenhower, this (lesser) scourge also

  signifies, in the final sense, a theft from those who hunger and are not fed, those who are cold and are not clothed.  It is spending the sweat of its laborers, the genius of its scientists, the hopes of its children.

Maybe an outright ban isn't the best intervention (and maybe it is), but I'm certain denial of the underlying problem will yield us zero progress.

[0] https://news.ycombinator.com/item?id=29425650 or https://en.wikipedia.org/wiki/ITA_Software

The whole point of the free market is that you don't have to figure out what it actually costs to provide a good/service in order to determine a fair price because if a price isn't fair then someone else an provide the same good/service for cheaper and win all the customers. In practice of course there is no such thing as a free market but a buyer being able to figure the lowest price a vendor will accept was never part of it.

OnlyPlanes

No they don't, but they paid for a ticket, and any insurance amount is probably more than the discount of flying in a group.

Yes most airlines have eliminated change fees, and rebooking isn't too difficult for business travelers. But that's not a refund, and people booking 6 to 12 months out tend to be families going on vacation or to a specific event. So if something changes, there isn't always something else to book, or at least not on that specific airline. Further, what you call "moderate" status - the lowest level - has been raised to require an enormous amount of spending on any one of the major airlines. And don't get me started with "you only need to spend 100k on their credit card..."

I dont really buy into the businesses don't care about cost - maybe for top execs - but companies are obsessed with expense reports and accounting for every penny, reducing per diems, limiting hotel cost ceilings, booking through a specific travel agency, etc. And of course most companies are working overtime in every other department to slash costs, why would travel be spared? Being able to buy flights in bulk and save money seems like it would be highly appealing to finance managers.

Of course, there are exceptions. Governments seem to be some of the worst violators, they really do not care about costs and in many cases they egregiously throw money around for 5 star luxury hotels, first class flights, etc.

Again, not seeing the “forcing” in that choice of time and effort.

If anything, booking together with a stranger would allow you to leave an empty seat between you which is less likely to be filled than if you leave two empty seats next to you.

And the service could even be set up to give you some choice over the stranger (at the expense of less matches) like setting a maximum weight.

This is a half-truth. The flying experience was much different back then. As another commenter posted, airlines competed on amenities then, they compete on prices now. Look at the ads from that era; you see full roasted turkey being served and even an in-cabin piano bar! Your statement lacks nuance and is comparing apples and oranges to shoehorn in a “regulation is bad” narrative.

You get what you pay for.

Not where I live at least, by any means.

Agreed. I participated in a points-based package that used to be offered by AirAsia. It was about $300 for 30 points. Flights between cities/countries were 1 to 3 points each, I probably got 3x my money's worth and still had about 4 or 5 points left over.

> You were never getting on the plane in the first place.

I'm not sure that's true. The airlines are gambling that at least one person will miss the flight for whatever reason, and they'll get away with overbooking.

But, of course, when they loose that gamble, it's really a passenger that looses. The house always wins.

> You were never getting on the plane in the first place.

Not always the case, you could be physically removed from the plane because the flight is full:

https://www.flyertalk.com/articles/overbooked-united-flight-...

We can debate seat pitch I guess but economy seating hasn't been great for decades and something like United Polaris is better than Pan Am first class ever was even if food is arguably a downgrade.

Both

> And often retailers pay more at POS terminals!

This is really the whole point. The sale of data is much less lucrative than the purchases by the customers themselves, especially for the "nicer" cards.

If you are a CC company with wealthy clientele, they tend to spend more. This means that retailers are willing to offer deals/rewards to attract those clients, and also that you want to offer rewards to keep those clients.

This is why e.g. American Express has cards with great rewards, high annual card fees to keep the riffraff away, and retailers willing to take a larger % cut in order to have those cardholders shop at their store where they presumably purchase more.

Not saying you're wrong exactly, but https://www.bitsaboutmoney.com/archive/anatomy-of-credit-car... does a good job of explaining the mechanics of rewards programs. It is more complicated/interesting than what you describe IMO.

Evil tracking is half of it, but the nominal "loyalty" benefit is there too. If I have a bunch of points with one company, I'm likely to accept a slightly worse deal from them relative to a competitor where I have none in the hope that I'll acquire enough for an award.

Non rewards credit cards also track purchases. It’s a revenue stream few companies are just going to leave sitting around.

As someone who's not overweight I don't think I would care. What I really wish they'd charge for is overhead luggage. I wish they'd charge so much that no one bothers with it.

I didn't know what a GDS was. Apparently it's a Global Distribution System and there's 4 major ones, including Sabre which I've heard of and 3 that I haven't.

I don't know how a normal person would have access to any of them. They're described as being offered via subscription to businesses.

https://www.bookingninjas.com/blog/gds-system-top-reasons-wh...

> I am not a fan of airlines because, among other reasons, it often appears that demand and competition aren't driving price.

First off airlines are an extremely low margin business.

AA's net margin is 1.26%, Delta's net margin is 5.91%, United's net margin is 6.43%, Alaska's net margin is 2.86%. These aren't exactly blockbuster SaaS numbers.

Demand and competition absolutely drive price reductions - competitive routes have much lower revenue per available seat mile - and adjusted for inflation air travel is wildly cheaper than it used to be. Since 1995 the cumulative inflation-adjusted price of domestic air travel is down almost 37%. [1] Thanks to competition you can fly from SFO to NYC for $99, non-stop, next month. On the other hand SFO to GUM is $1662 ($1100 on a half round trip basis), because there's no competition.

Airlines with both a domestic and international route network tend to lose money on their domestic routes and make up for it on their flagship international routes, but even still, they make most of their money on frequent flier programs and credit card relationships.

St Louis Fed has a good write-up on the economics of air travel. [2]

[1] https://www.bts.gov/content/annual-us-domestic-average-itine...

[2] https://www.stlouisfed.org/publications/page-one-economics/2...

It doesn’t seem to be that widespread - mostly being confined to short one way trips. There is no evidence of it happening on international or return flights.

It feels more like a test of a strategy to fill middle seats.

I don’t trust that any modern company would actually “use the surplus to subsidize products for poorer consumers”, that sounds like the kind of College Economics fact that isn’t actually true in the real world.

Everyone knows airline transport is a service, not a good.

You have to invert the order of how most people plan travel.

Typically people plan in this order:

1. Where to go

2. When to go

3. Check airfare

Flip it on its head:

1. Keep an eye out for cheap flights from your home airport

2. Pick one of those destinations

3. Choose when to go

Not exactly inverted, but the flight goes from last to first.

I had Ireland in my head for my next trip, but then Italy showed up last week. That sounded pretty good, so I checked the dates and found a flight that fit in my schedule, and booked it.

It’s not great for getting a flight around a conference, wedding, or some other event you are planning around. But when you know you want to take a vacation to somewhere and sometime this year, it can cut flight costs in half.

A single flight ends up paying for the cost of the subscription 10x over, and then some.

Also, it could be somewhere near where you want to go. I had tickets to Croatia about 5 years ago, but hand to cancel due to the pandemic. I didn’t know anything about Croatia when I booked, but I figured the worst case scenario was I catch a quick ferry or flight over to Italy once I’m there. Once you’re over there it’s cheap to go one country over. That flight to Croatia was $289, that cheaper than a flight to Nashville for me, which is only about an 8 hour drive.

I did the same thing when I booked a flight to Sweden. I didn’t know if I’d like it there, so from there I booked a connection to Copenhagen for next to nothing. I spent a week in Copenhagen, but then ultimately did go back to Sweden for week, which I ended up loving. I’m glad I didn’t spend the whole trip in Copenhagen.

Another deal I got that stood out was to Tokyo. I think I paid around $550 give or take. A coworker of mine has family there and goes on a regular basis, he was floored by that price. He always pays over $1k, and usually closer to $1,500.

Ultimately it’s just an alert service for flights that are abnormally low. If you have a specific destination in mind, Google Flights is pretty good at showing when the cheapest time to travel is, giving a booking date of today. Of course it fluctuates over time, which is where the alerts come in.

It’s saved me thousands. Though I probably would have only taken about 20% of the trips I have without it.

In most cases the cost of fabric itself is a pretty minor part of the garment price- you're paying for someone to design the clothes, assemble them, ship them, and operate a store that sells them, and those costs are pretty much the same for small and large sizes. Adjusting the price based on the amount of fabric used would probably end up being a dollar or so for the things most people wear on a daily basis.

Unusually large or small sizes can end up more expensive (and/or only manufactured in limited quantities) because they're not commonly bought and they take up space on the shop floor and in inventory which could be used for things with higher turnover. (Edit: Also at the extreme ends of sizing simply enlarging or shrinking the pattern won't work well, you have to redraft it so it sits correctly on a petite or plus-sized frame).

They already are?

Some shoes (Meindl Boots) actually go up in price for larger sizes (>46 EUR, 13 US I think) due to the additional cost of material.

if you are very tall they charge a lot extra for having tall sizes... what are you talking about??

Devastating to individuals sure. I hold a pretty high bar when it comes to something being truly critical enough for the government to bailout, economic concerns never meet that bar for me.

If we allowed markets to become monopolized we have to deal with that when the bill comes due rather than kick the can down the road.

If Delta went under another carrier would buy their planes and gate access at those airports, it might be chaotic for a short time but if there is enough demand to fly from point A to point B someone will provide the flights.

If Delta went under, one or more airlines would rapidly go "hey, there's a proven demand that's suddenly unmet", and there would very quickly be replacement flights.

I would say unless you find playing the miles and points game to be very enjoyable, which I do, you're better off with a cash-back card. For most people the Citi Double Cash at 2% is a great bet, if you have $100K in investments with them, you can get 2.625% back via Bank of America's Unlimited Cash Rewards card.

> So I screenshotted the horrible one-way price to go in my expense report, and then booked the round trip ticket.

So… you committed fraud? Cool?

I’m all for sticking it to the corporate overlords, but careful how far out you stick your neck.

I meant the accommodation going to waste (unused), which could be used by someone else.

But yes, in terms of money, it sure is waste to pay more for the flight.

Because they may change their plans. They could be a no-show (which will affect your return flight). They could call and change the flight without your knowledge. They could add extras to the trip and charge it to your card.

People are flaky, and being on the same itinerary with the same PNR as someone else means your trip is in their hands.

Yes, most domestic US airlines have eliminated change fees. But as you point out, it's not possible to get your money back and it's not easy to make changes if you don't have an alternative trip in mind. Cancellability is valuable (see hotel bookings), and yet, people over-value the option - sometimes out of laziness, or they forgot, or they go with the original plan. I have difficulty believing airlines would lose very much if they offered full refundability up to about 3 or 4 months in advance, but they would probably get more bookings, most of which would likely not get cancelled.

>The thing I find interesting about a lot of things like this is that they feel like a holdover of half the era where negotiating prices was normal: today, for most people in the US, most shopping is just a matter of going somewhere and paying a set price and you don’t argue with the seller to get a better one. B2B transactions still usually involve a negotiation, I think, but it’s basically gone for consumers.

Not really. The "negotiation" is still there. Time limited discounts weed out consumers who need something immediately. Coupons weed out people who aren't willing to put the legwork to find them. Loyalty programs and app-based offers (eg. McDonalds) take all of this to the next level by sending targeted coupons based on whatever demographic/behavioral information they can glean from you.

There is absolutely an ethical problem with charging people different prices for the same exact product/service

They make extra money from fools thinking they can beat the system, not from the people that avoid it.

If points systems caused losses then nobody would have them. They’re money makers, and that money is coming from someone’s pocket.

I think you missed the last bit of GP's sentence (even though you quoted it literally on your own):

> to get the full value of my money.

No one is forced to understand the system, but that means leaving some indeterminate amount of money/value in the hands of the predatory airline.

> They also have the poorest who have cheap credit cards subsidize the richest who have the best cards and receive most of the rewards.

This is false. https://x.com/patio11/status/1902555603534295115

The richest pay for the best cards and presumably buy enough appropriate goods to make the best cards worthwhile.

I seriously doubt it would make much difference for deplaning - people already stand in the isle with their luggage out of the compartment long before the doors open.

For boarding it might speed things up but often boarding is done before all checked luggage is loaded so it will probably not let you take off faster either.

Speaking as a fat person, air travel is horrible and I'll happily drive a couple thousand miles to avoid flying.

On a flight to Greenland I spent six hours smashed up between the window and a stranger (constant, sweaty, skin-on-skin contact) because they put three fat guys right next to each other on a full flight. I'd rather have taken a couple months of vacation and ridden the icebreaker in.

> Yet another situation where men pay more and get worse service.

Is this some kind of satire? In many cases (for a whole slew of things), I feel like men pay less and get better service.

Fuel surcharges are generally accounted for as part of the fare on revenue tickets, they're a way of extracting additional revenue on award tickets. However, all the major US rewards programs don't charge fuel surcharges anymore. Air Canada gave up on it too. The only one of note is Alaska and American redemptions on British Airways.

On domestic tickets there's no YQ, YR or embedded Q surcharges anyways.

Domestic airfare in the US is down 36% adjusted for inflation since 1995. [1]

Even base tier status concentrated flying with any one carriers get you a waived checked bag, and so does pretty much any airline credit card. So basically you shouldn't pay more than $95 a year in checked baggage fees.

US airlines generally have sub-5% net margins which is why they find themselves in creditor protection every decade or so when the market turns. There's a long-running adage about investing in airlines.

[1] https://www.bts.gov/content/annual-us-domestic-average-itine...

Bag fees are fairly small compared to the ticket price and obviously don’t make up for a 50% decrease.

People who fly any amount don't pay for checked bags if they check anything at all.

Are you at all concerned the airlines will remove the air from the cabin if you try this, just to emphasize that you’re not going to get a refund this way?

Anyway I’ll be across the aisle with hydrogen balloons paying less than you either way. Enjoy your flight!

> personal helium balloons

Not allowed because they're too big to be carry ons.

And I think that you may mean volume.. :-)

The airlines are dealing with the size people are by, in your example, preventing those oversized for their chosen seat from negatively impacting others.

> And while my being fat is definitely a result of my life choices, that's certainly not the case for all of us.

It literally is. No matter the genetic predisposition, you need a caloric surplus to get fat.

> They could have just plastered "no fatties" at the ticket counter, or maybe had a section of seats reserved for fat people at a somewhat higher price point and required people over a certain size to use them, but instead they've chosen to sit us all together.

They do provide bigger seats at a higher price point though. You have chosen not to make use of them and then blame the airline. If you are big enough that sitting next to someone your own size causes you discomfort then you would be encroaching the space of someone smaller sitting next to you. That wouldn't be fair to them.

It's price discrimination in that different people have different tolerances for spending time and energy on hunting for deals. I'm sure not lining up at 6am for Black Friday sales though I may take advantage of a President's Day sale if I need some large electronics anyway. It's not really negotiation as the term is normally used. The process is pretty different.

I think this is a framing issue.

Is it fair to charge people with different sized families different prices (per unit) for toilet paper?

vs.

Is it fair to charge people different prices (per unit) for different sized packages of toilet paper?

The former makes it seem nefarious but the latter is commonly accepted as fair. Same for airline tickets - if there's a discount for buying in bulk that's just as fair as a discount for buying toilet paper in bulk.

> It's price discrimination. You know the thing people fucking hate when trying to buy a car

Transparent pricing worked as a positive differentiator for cars. (Saturn. Tesla.)

I believe airlines have tried their hand at it. But it doesn’t budge the needle. If there is a single enduring truth to at least American airline demand, it’s that most consumers will pick the cheapest ticket. Almost nothing else matters, when it comes time to pay for it, to almost all of the flying public.

The incentive is right in the term loyalty points. Tending to stick with one airline, if you travel a lot, has all sorts of status and rewards incentives. Which you can augment with things like branded credit cards, etc.

It actually literally contradicts what you said. People flying any amount (at christmas with their family) are paying bag fees.

I don’t know why you’d trust the guy that works for a credit card processor telling you that credit cards are fair, actually.

And Twitter doesn’t show threads unless you’re logged in btw, so you just linked Patrick’s opinion.

I'm a regular guy and I have experienced skin on skin contact when someone overweight is next to me on a plane. Why should I have to endure that ?

>rich people spend more in total at the store so their interchange costs are more than made up for by actual spending

Suppose people making $1M+ are taxed at 20%, and everyone else is taxed at 25%. Ignoring the small segment of people making just under $1M, most people would at least characterize this as unfair. You could plausibly this isn't a "subsidy", because the $1M earners are paying more taxes in absolute terms. However it doesn't really refute the argument that the $1M earners are paying "less". Maybe "subsidy" is the wrong word for this, but it's pretty clear this is what detractors of credit card are pointing out.

> it's a big premium. Which I might pay for especially long haul international but I probably won't for a domestic flight

Sure. That’s the point. So the market rewards the carriers who can cut prices lowest.

What I would be curious about here is whether this single/double discrimination extends to Delta’s loyal customers. (My hunch is no.)

Not really. I fly a lot. Lounges are entirely superfluous. Business class is overkill when premium economy exists. Boarding early is silly, the plane takes off at the same time.

People just like feeling like they’re special, and they think points are a cheaper way of getting special treatment. In practice they’re not tough.

That's because premium seats are ridiculously priced compared to the advantage they offer and compared to the cost to the airline. If you could purchase e.g. 10% additional seat pitch for 10% extra (and even that would be unfair without an additional 10% baggage allowance and so on) then you might have an argument.

> This is false because the interchange fees, and in fact all of the fees, have to pay for the entire company’s operations, not just for your points program.

Sure. But the default and reasonable presumption is that at that scale, companies do things because they're profitable; in this case, they implement rewards programs because they make more money by doing so. In particular, the default and reasonable presumption is that companies don't spend more money acquiring a class of customers than they expect to make from those customers. The claim by the Atlantic article is that credit card companies lose money on the rewards programs for rich people. There's no evidence of that, and some evidence to the contrary.

> Without more detailed data it’s not possible to rule out the possibility that points programs are a subsidy for the rich.

That's not where the burden of proof lies. Without more detailed data it's not possible to demonstrate that rewards programs are a subsidy. The conclusion is not presumptively valid.

I'm not suggesting, either, that the argument from the linked Twitter thread is ironclad, just that it's compelling evidence against.

> The second assumption he makes is that volume is the same across the board. It’s not, there’s way more customers on the lower end, and the company charges them even more fees. So sure, rich customers individually pay more interchange fees, but the company could still be making most of its money from poor customers.

"more customers on the lower end" is in fact refuted by the data; see figure 2 (F) in the linked paper.

"making most of its money from poor customers" might be true, but note that figure 2 (E) is scaled by "percentage of average daily balance", and if you were to view it in absolute terms, it seems less likely to be true. Even if it were true, though, it's not evidence of a subsidy of rich customers by poor customers. The credit card companies very obviously think that rich customers are profitable to acquire and keep, or they wouldn't pursue them so heavily. The evidence from the thread supports that claim.

The argument being made in the thread is, precisely, if the rewards program pays for itself an individual customer, that customer is not being subsidized in any way.

If you want to claim that the rewards programs offered to richer customers aren't in fact profitable for the credit card companies, that seems like an even more extraordinary claim, and not one that seems to have supporting evidence.

Alternatively, if you want to define "subsidy" so broadly that any business making more money from one group of customers than another is having one group of customers subsidize the other, even if they are making money from both, then I'd question your definitions and use of evocative terminology. They're spending money to get a group of customers, and if they're spending more to get those customers than they make from those customers, they wouldn't spend it in the first place; if they're spending less to get those customers than they make from those customers, then those customers are not being subsidized.

Narrowing them further can allow even more people to fit, uncomfortably. The fact that you have any space at all is because larger people have to fit somewhere.

Leaving aside other inaccuracies in the model, and leaving aside insulting non-responses like "that's a lot of words" that inherently penalize analyses of a complex system and favor oversimplified models even when incorrect...

The cherry-picking in question, here, is that you are choosing a model that claims the rewards being paid to richer people are a subsidy of the rich by the poor, by attributing one input to one output, while ignoring everything else in the system. Think about double-entry accounting for a moment: would it be reasonable to point to one inflow and one outflow and say "this inflow paid for that outflow!" as a serious model, without looking at anything else in the system? And in particular, would it be reasonable to claim that as the "core point" and demand that people refute that point while ignoring any evidence invalidating the oversimplified "one inflow, one outflow" model that privileges that point and treats it as the core point?

To draw an analogous argument, which is faulty for the same reason the credit card rewards "subsidy" argument is faulty: if a store offers a "bulk discount", is that a subsidy from poor people (who may not be able to afford to buy or store in bulk) to rich people (who on average can do so more easily)? Using the same modeling you're describing would paint it as such: poor people pay more for the same goods. I would argue that it's more accurately modeled as an incentive offered by the store that they see as on net bringing in more revenue? Do you expect that the store, upon receiving that higher revenue, needs to use it to somehow lower the prices paid by poorer people to compensate? And if they do not use it as such, and instead pocket that additional revenue or use it in some other way, does that suddenly make this a subsidy from poor customers to rich customers?

I am, in general, in favor of the argument of analyzing a system's net effect and not just its intentions. But it's faulty to analyze a subset of the system and then attribute fault or foment outrage based on that simplified model of the system.

If you want to argue that the entire system is not the perfect system, or that it could be improved, you'll get no argument from me. If you want to argue that, in general, "having money is a massive advantage for getting more money", again, that's entirely true right now.

If you want to argue that you've shown a specific subsidy of the rich by the poor, I think you haven't given evidence to support the validity of that model. And in particular (and to my mind the more important aspect of that argument insofar as the point of arguing about systems is to evaluate potential changes to them), if you want to argue that in a different system with no interchange, poor people would pay less for the same goods than they do in this system, I think you'd need more of a model of the overall system to successfully argue that. In particular, among other things, 1) would merchants actually make more in that alternate system rather than making less (which the observation that merchants make more money from higher-income customers calls into question), and 2) would merchants actually pass that savings on, specifically, to lower-income customers, which the observation that they don't currently charge different prices for different customers calls into question, and 3) would some other part of that system change as a result that makes things worse in other ways, such as products like cards or checking accounts (a checking account is a credit instrument) no longer being available to people with lower income or lower credit scores?

I'm not making this argument because I think the financial system is perfect and shouldn't be changed, or that the financial system overall is fair. I'm making this argument because the oversimplified model that foments outrage by claiming a subsidy of the rich by the poor is a bad model for the purposes of reasoning about the system and attempting to make it better. Criticizing that model and arguments based on that model isn't based on wanting to preserve or advocate for the status quo, it's based on wanting to accurately model the world as a step towards evaluating potential improvements.

>Every argument I made in this thread was about private companies, who have every incentive to only take customers who make them money; that's especially true if they're spending marketing money attempting to pursue such customers. I am making no claim or argument about government spending, which has fundamentally different strategies and goals.

A government might have different goals than a profit making corporation, but when it comes to revenue generation much of the principles are similar. The demand curve vs the laffer curve, or the idea of giving discounts in the hopes of increasing absolute profit (or in the case of governments, tax revenue less any government services/transfers). Therefore I'm not really sure why you can't compare rich people getting cashbacks to rich people getting tax breaks.

>Insofar as words have meaning, possibly. Before arguing that one group is subsidizing another, you'd first have to argue that one group is being subsidized. Leaving aside the original meanings (which only describe public funds in the first place, which this isn't), and interpreting the apparent meaning, the claim is apparently that credit cards lose money on rewards programs for rich customers, and those programs are thus subsidized, and specifically that they're subsidized by poor customers. If that were the case, they wouldn't have those rewards programs. (I'm not claiming that no company in the world has ever spent marketing money they didn't have to or spent it unwisely; I am claiming that an absurd amount of analysis has gone into the finances of rewards programs, in particular, and it is extremely unlikely that card companies are spending more to acquire a class of customers than the revenue they get from that class of customers.)

I'm not sure how you got the impression that the argument was ever "credit cards lose money on rewards programs for rich customers". The linked atlantic article specifically says that it's not the case:

    “When you talk to rich people who pay off their balance, they think that credit-card companies are losing money on them, and they’re the ones subsidizing the people who carry a balance,” Klein explained. “It’s the exact opposite.”

Moreover the article is pretty specific on what they're against:

   In 2023, these swipe fees amounted to more than $224 billion, driving up retail prices by $1,700 a year for the average family. Everybody pays more for their goods; only fancy cardholders get juicy perks and cash returned to them.

In other words, they're not claiming that card companies/stores are losing money to "fancy cardholders", or that they're even making less money from them. They're decrying the fact that everyone pays the same markup on interchange, but only the rich get "juicy perks and cash returned to them". You might quibble on the use of the word "subsidize", but the article is pretty clear on what's happening, and it's unfair to dismiss it with a "this is false".

>I don't think rewards programs are a redistribution program; any such claim would imply taking a loss on a class of customers but keeping those customers anyway

Defining "redistribution" is non-trivial, especially for businesses with high fixed costs and low marginal costs. For instance, suppose we define "redistribution" to only mean when a customer brings in less revenue than his marginal costs. That sounds reasonable, but it leads to some absurd conclusions. The most extreme example of this would be F2P games, where the vast majority of income comes from a tiny segment of the player base, "whales". The rest either spend trivial amounts or nothing at all. Given the economics of online games (high fixed costs to develop, low marginal costs per player), using the strict definition of "redistribution" above would imply the whales are not subsidizing all the other players. But this description doesn't feel correct, or at least doesn't tell the whole story. If all the whales evaporated there's no way the game would stay afloat, so it's reasonable to argue that in some sense, the whales are paying for everyone else, even if no "subsidy" (in the strictest sense) is going on.