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  • Overview of Airline Fares

    What's the fare to Chicago?  That depends...
    It is often said in jest that every passenger on an aircraft pays a different fare; in truth such a statement is not as preposterous as you might think.

    Business or Pleasure?
    Airline customers comprise a heterogeneous group, but basically people usually travel either for business or for pleasure.  The airlines adopt a marketing strategy therefore that makes it very difficult for business travelers to take advantage of special holiday fares while at the same time maintaining competitiveness in the leisure market.

    $$$ for the airlines...the Full Fare concept
    Generally speaking, airlines want business travelers to pay an amount at or near the so-called "full coach fare".  This fare is the regular fare quoted for travel from Point A to Point B, and it has no restrictions.  This fare can be purchased at any time right up until (close to) departure time, it is fully refundable, it allows a reservation to be changed at any time without penalty, it has no minimum or maximum stay, and it is valid for one- way or return travel (the return fare is usually double the one-way fare).  You can buy a full coach fare on one airline for your outbound flight, and return on a different airline at the same full coach fare.  In short, you can do whatever you want with a full coach fare.

    For example, imagine a sales associate working for a large firm in New York, who gets a call on a Monday afternoon from a potential buyer in Los Angeles interested in purchasing a large quantity of the product for sale.  The buyer would like to see some samples and meet with the sales associate on Tuesday in Los Angeles.  Thus, on Monday afternoon the sales associate would need to make an arrangement for a flight on Tuesday from New York to Los Angeles, with just one day advance warning, and she would like to come home either on the overnight flight Tuesday night or first thing Wednesday morning.  This sales associate would almost certainly be required to purchase a full coach fare ticket given these circumstances, which are representative of many business traveler's plans.

    You'll stay a Saturday night?  We'll take 75% off!
    Suppose on the other hand that a college student in New York wants to return home to Los Angeles for Spring Break.  The dates of the Spring Break are known well in advance, and the student will stay home for about one week.  This student would generally be able to take advantage of some special fares offered by the airline, since he would meet the rather common special fare restrictions of advance purchase time (usually one, two or three weeks) and a minimum stay requirement (usually a Saturday night).  The college student might pay 75% less than the full coach fare paid by the business traveler, even though they may end up on the same flight.

    The new model - low one way fares
    The above scenarios describe the traditional model of large, legacy carriers. The new model, used for example by Southwest and Air Canada, consists largely of one way fares, with therefore no such thing as a minimum Saturday night stay. The new model still however generally offers lower fares with advanced booking. The lowest fares usually require 14 days advance booking.