Minimum Stay Airfare Rules
(Dive Travel Business News - May 26, 2008) -- Veteran business traveler Kevin Cuddihy knew he was in for a steep fare as he shopped online for a same-day-return weekday trip recently between Charlotte and Philadelphia.
But $1,420 for a coach ticket?
“I expected to pay more, but not that much,” says the cable company executive from Mooresville, N.C. “I’ve not paid that kind of money anytime this year.”
Clicking further on US Airways’ website, he discovered that the fare would come down to $580 if he stayed in Philadelphia Saturday night.
He opted for the cheaper fare, reluctantly.
Once the bane of business travelers’ existence, the Saturday-night-stay rule and other stringent minimum-stay requirements are making a comeback after several years of relative dormancy.
These rules are imposed on cheap fares that were bought at least 14 days in advance. Airlines believe they generate more revenue because business travelers don’t like to stay on the road on weekends and many will reluctantly pay more expensive fares that have no such restrictions.
Rick Seaney, CEO of FareCompare.com, called them “onerous.”
“It prevents savvy business travelers who buy tickets ahead from taking advantage of the 14-day window.”
Saturday-night stays were commonplace, until competition from low-cost carriers intensified, forcing large networks to reconsider their fare rules and structures. Low-cost carriers such as Southwest sell one-way tickets, meaning travelers aren’t stuck with minimum-stay rules.
In early 2005, Delta introduced its SimpliFares program, which introduced one-way tickets and waved strict minimum-stay rules. Other carriers soon followed, and the Saturday-night-stay and two- to three-nights stay rules, in particular, mostly disappeared, Seaney says.
But with skyrocketing fuel prices, they began reappearing late last year. Last month, Northwest announced that its “fares that formerly carried a one- or two-night minimum stay now require a two- or three-night minimum stay.” It was following similar moves by Delta, United and American, it said.
“This is just one more move we are making to offset the extraordinarily high fuel costs,” said Northwest executive Jim Cron in a statement.
In analyzing more than 72,000 current round-trip fares for the top 50 U.S. city pairs that airlines have filed with its industry clearing house, FareCompare.com concluded that 57% — or about 41,000 fares — now have a minimum-stay requirement.
FareCompare’s analysis also revealed that only about 8,000 of the 41,000 round-trip fares with a minimum-stay rule were of the least onerous variety — the one-night requirement.
It means about 33,000 fares of the top 50 cities in the USA — or nearly half of all round-trip fares — require travelers to stay at least two or three nights or Saturday or Sunday nights.
The application of such rules depend on local market competition, time of the year and whether large carriers are willing to follow suit on a rule set by an airline in a given market.
People in cities that lack low-cost carrier competition, such as Cincinnati, Charlotte and Minneapolis, will likely see such rules.
The flights at hub airports that have no direct competition — routes from Atlanta not served by AirTran, for example — will also likely come with minimum-stay rules.
In bringing back the old business practice, airlines are betting that more customers will make decisions similar to the one recently undertaken by Dave Landon, a corporate recruiter.
The frequent flier from San Diego was shopping for a round-trip flight on Delta to Cleveland, hoping to leave Wednesday and return the following day.
His quoted fare: $858. Out of curiosity, he punched in a new itinerary, returning on Sunday. The fare was $601.
Landon says he was “incensed,” but chose the more expensive fare because hotel expenses for a Saturday stay would eat up any airfare savings.
Calling the new rules “short-sighted,” Landon says they “will ultimately cost the airlines the revenue generated by their most frequent and consistently loyal customers — the business traveler.”
Caleb Tiller, a spokesman for the National Business Travel Association, says it’s “a back-to-the-future change” for airlines. “It’s certainly a complication in managing travel,” he says. “It’s one of many changes that airlines are implementing right now. And corporate travel managers are having to adjust on the fly.”
The minimum-stay rules alone aren’t likely to lead to a cutback in corporate travel, he says. But travel managers may reconsider if “airlines’ changes collectively raise the cost so much that they have to raise their travel budgets.”
There are ways to get around it. In the past, business travelers skirted the Saturday requirement by buying two round-trip tickets — one set for your departure date; another for your preferred return date.
Buying two round-trip tickets with minimum-stay rules was often cheaper than one ticket without it.
Tink Wilkinson, a software consultant from Mobile, Ala., says he will consider resorting to the old trick. He often works at a remote site for months at a time but returns home for weekends. He plans to buy a one-way ticket for the first week of a project, and then buy cheap round-trip tickets with a Saturday-stay rule to come home on weekends. He will then buy another one-way ticket on the last week of the project. “I will deal with it just like we did before.”
Cuddihy from Charlotte found a similar solution. Instead of lingering in Philadelphia during the Memorial weekend, he bought a $240 round-trip ticket from Philadelphia to Billings, Mont., where his family has a cottage. He left last Thursday afternoon following a business meeting and plans to return in time for his flight back home to Charlotte. “So I get to have a vacation and save a little bit of money.”
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