American’s Basic Economy Fares Are Working for the Airline So Far
Photo Credit: It's early, but American's new Basic Economy fares are probably beneficial to the airline's financial results, one analyst said. American Airlines
Skift Take
Did you think Basic Economy fares would be good for consumers? Ha. Airlines are in the business to make money, and this is one more tool to maximize their ability to increase revenues. For shareholders, that's good news.
American Airlines' Basic Economy fares — the cheap, no-frills tickets that bar most passengers from bringing larger carry-on bags — only have been available for six weeks, and they're sold in just 10 U,S. domestic markets, but one influential Wall Street analyst says they've already been beneficial for the carrier's revenues.
Analyst Hunter Keay of Wolfe Research said he tracked American's pricing for the first five weeks of Basic Economy and found it helped the airline raise fares close to the departure date.
American created Basic Economy to appeal to the most cost-sensitive travelers — passengers who do not mind that they'll board last, that they're not eligible for upgrades, or that they can't make ticket changes. Before, American
