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How COVID-19 Broke the Airline Pricing Model

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Factors limiting COVID-19 transmission on flights

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Webinar: Defensive Pricing During COVID-19

On May 4th, 2020, Insight hosted with Eddie Hartman, Partner at Simon-Kucher and Partners, as he discusses critical frameworks for defending your revenue during COVID-19, and accelerating into the economic recovery.

This webinar will cover specific pricing and retention strategies, drawing on data from the 2000 and 2008 crises. The goals are to protect your company’s revenues during the current crisis, and to set your business up to succeed when recovery comes – even if the recovery is non-linear.
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How Aviation and the Airline Industry has Changed in 2020?

2020 is a year we want to forget, but we will not forget.

This video captures the top aviation moments in 2020. Aviation started the year on a high, we saw the Boeing 777X make its maiden voyage in January. But at the same time, China got hit hard with Coronavirus and it is spreading fast and at an alarming rate. Aviation came to the rescue, with flights to repatriate citizens back home.

Then we saw a systematic lockdown across the world, with thousands of planes grounded in an unprecedented way. Many jobs have been lost… With most passengers flights being grounded, it almost broke the logistic chain. The demand for cargo was also unprecedented. We saw every airline flying cargo missions to carry masks, PPE and other medical supplies using passenger planes.

Then summer came and things eased up a little. With many countries re-opening I now have the opportunity to fly again, with this I want to record and document what airlines have been doing in response to covid.

Many airports have also suffered badly, with drops of up to 90% in traffic the terminal is like a ghost town. Airlines have started to enrol passengers using their biometric data, so your eyes and face became your boarding pass. The Boarding process has also changed; a lot of airlines are providing hygiene and wellness kits onboard to their customers. You can see flight attendants wearing masks and gloves, some are even dressing in full PPE.

Initially, airlines resorted to providing only box meals to passengers; this was in a bid to reduce contact, to lower cost and also due to some catering supplies being unavailable at outstations. I am glad to report that most airlines have now returned to their usual service levels, with everything being sealed or wrapped.

What’s breaking every aviation enthusiast's heart is the retirement of the 747s. KLM, Qantas and British Airways have all decided to bring forward their retirement dates. COVID also posted an uncertainty on the world’s biggest airplane, the A380, which has also become a casualty of the downturn.

At last, some good news. The covid vaccine is being made available. The timely transportation of vaccines will be aviation’s next challenge!

2020 has been a roller coaster year in commercial aviation. Words can’t express the emotions we have been through….I want to thank you for your support and viewership in the past year. Here we hope for a better year ahead.
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The Project QANTAS pilots affected by COVID-19

The sad but inspiring story of what some QANTAS pilots are doing as a result of COVID-19.
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What Does The Future Of Air Travel Look Like?

Of all the industries the coronavirus pandemic has affected, the airline industry is among those that have been hit the hardest. According to the International Air Transport Association, airlines' passenger revenue is estimated to sink by over $300 billion from 2019. In the age of social distancing, planes are not designed to keep passengers six feet apart. Still, airlines are making drastic changes to their travel policies, pushing sanitation efforts, and more to attract weary travelers back to the skies.

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What Does The Future Of Air Travel Look Like?

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HEDNA Webinar - April 2020 COVID-19 Virus Hospitality Impact – Past and Recovery

Our world is facing a profound crisis with the COVID-19 pandemic. Travel restrictions, limited face to face interaction and closures have led to a profound impact on hospitality companies.

Presenters:

Chinmai Sharma from RateGain
Noreen Henry from Sojern
Philippe Garnier from InterContinental Hotels Group (IHG®)




HEDNA (Hotel Electronic Distribution Network Association) is a not-for-profit trade association whose worldwide membership includes executives and managers from the most influential companies in the hospitality industry. Founded in 1991, HEDNA's mission is to be the leading global forum for advancing hospitality distribution through collaboration and knowledge sharing. Its vision calls for HEDNA to be known for creating an environment that fosters strategic collaboration toward business development in the global hospitality industry. For more, visit

Business Process and Digitization Crucial Enablers in Post COVID Industry

For the industry to emerge successfully from the COVID-19 pandemic, doing things the same old way won't do. While attention to the balance sheet by CEOs is expected, a once in a generation opportunity to redesign the entire journey ecosystem cannot be in ignored. Now is the time to evolve strategies, objectives and plans to reshape airlines, build system efficiencies and develop readiness for a future that will be very different but also eerily familiar.

As the industry emerges from COVID-19, business process and digitization will be critical enablers of efficiency, improved margins and banking future resilience.

Moderated by John Synnott (Manager, Flight Operations Information Technology - IATA)
Panelists:
- Capt. Michael A. Bryan (Managing Director - Closed Loop)
- Marcus Carr (Director of Projects - Closed Loop)

Webinar recorded on August 5, 2020.

Insider Video: Bill McGee on the Future of Airlines After the Crisis Part I

James Shillinglaw of Insider Travel Report talks with Bill McGee, a journalist, airline expert, author of “Attention All Passengers: The Airlines Dangerous Descent—and How to Reclaim Our Skies,” and former editor in chief of Consumer Reports Travel Letter, about how badly airlines have been damaged by the coronavirus crisis, what it will take for the industry to recover and restart service, what will happen to fares, and what the aviation business might look like in the future. McGee also is the author of a novel, “Half the Child,” and you can contact him at

How to Start Traveling Again After COVID-19

As the world begins to open back up, you may want to start planning some trips for your family. But how do you decide where to go or how to get there safely? In this video I'm going to share with you some guidelines to keep in mind as you plan to travel again during this challenging time. New to our channel? We're the Sognonvi family from Top Flight Family, and we're all about luxury family travel, family vacation and kids travel! If you like family travel vlog videos about a traveling family, you'll enjoy what we do here.

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As you can probably tell, we're a multiracial family (or interracial family or mixed family - whichever term you prefer). Carmen is Chinese and Belgian, and mostly grew up in Hong Kong. Serge's parents are both from Benin in West Africa, and he was born and raised in NYC.

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WHY You SHOULD Travel in 2021 | Travel Tips: COVID-19

Having travelled to 5 countries since the pandemic, I wanted to make this video explaining why you SHOULD travel in 2020. I will highlight both the negatives and positives that I have experienced whilst travelling during the pandemic, share my top travel tips during the pandemic, and give my conclusive thoughts to help you decide on whether travelling is right for you.

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Cost Breakdown of an Airline Ticket

David Richardson, Director of Government Affairs, Southwest Airlines, break down what goes into the cost of a domestic round-trip U.S. airline ticket.

Duncan Bureau On Etihad Airways’ COVID-19 Testing And Sanitization Strategy

Duncan Bureau shares how Etihad Airways is building a resilient future by offering free COVID-19 tests, insurance and biosafety measures.

New Aviation Safety Measures Related to COVID-19

Although in 2020 we were forced to stop traveling for a while, international air travel after lockdown is now slowly getting back on track in a new and revamped way. In this video we’ve gathered together all the latest updates from airlines, creating a comprehensive guide to the new aviation safety measures during COVID-19 pandemic:
1) Face Masks
2) Social Distancing - airlines that block the middle seat
3) Individual Hygiene Kits - companies that give you kits free of charge
4) Temperature Screening - some airports and airlines are checking passengers temperature
5) Cleaning and Disinfection - new methods of cleaning
6) Covid-19 Testing

Currently, airports and airlines are doing their best to safeguard the health of all passengers. And it is our responsibility to respect and follow these rules to stay healthy onboard.

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Airline Industry Prepares For Peak Holiday Season | VTV World

Peak holiday season is set to arrive in less than two weeks. With air travel being the obvious choice for many, airlines are working hard to meet rising demands in the domestic market. This is considered both an opportunity and a chance for the airline industry to recover while international routes are still unavailable.

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{Industry News} // Coronavirus & Airline Travel

This week we're dropping a special 'Industry News' edition discussing the Coronavirus COVID-19 and how it can effect you while traveling on the airlines. We also give some inside information on the cleanliness of aircraft and some tips to protect yourself against the virus while traveling.

If you're thinking about a career as a pilot you're in the right spot! The Pro-Pilot Playbook is committed to enabling people to become professional pilots FASTER and CHEAPER. Whether you are just starting out, or getting ready to apply at the airlines there's valuable information here for you.

Learn more at:


You can also listen to this as a PODCAST with Apple iTunes or on Google Play. You can also go directly to the podcast website at:

KNOWLEDGE SERIES : Pricing Model (Part 1) – Damion Breust discusses DMC challenges

As the meetings and incentive travel industry struggles through the current COVID-transitioning phase, which companies are still in the market? Will the status quo be challenged? And how can event professionals leverage relationships with clients and suppliers so everyone can maintain their financial goal?

Want more? Damion shares considerations when buying the insurance suitable during the COVID-transitioning phase. Insights of the communications strategies needed to manage customers’ expectations can also be found in the full episode of BEA CONVERSATIONS with Damion Breust.

Click on this link to request for a full episode.

FLYING DURING COVID-19 IN CANADA - The New Normal | SB

We are flying for the FIRST time since the COVID-19 pandemic broke out. We are going to be flying within Canada from Edmonton to Vancouver with Flair Airlines. We have been anxious about flying again based on all the rumours we have heard so we finally decided to check it out for ourselves. We will talk about all the new procedures and what remained the same. Welcome to travel in 2020.

We hope you enjoyed our video, let us know your thoughts down below! Also, don’t forget to give it a thumbs up and SUBSCRIBE!

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Claudia and Abbey
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Cathay Pacific Announces Hong Kong-backed Recapitalization Plan

Among the hard hit airlines during the COVID-19 pandemic, Cathay Pacific announced plans for a HKD $39 billion recapitalization plan backed by the Hong Kong government. The airline looks to the Hong Kong SAR government to help the airline navigate through the unprecedented crisis.

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Airline Ticket Pricing & Why It Seems So Wacky Sometimes



Lucky from OMAAT talks about airline pricing , price discrimination & making sense of certain ticket prices .

One of the questions I get most from readers is how to airlines price tickets? Because they can't make sense of a certain ticket price. Why, for example, is it more expensive to fly just the 100 mile flight from San Diego to Los Angeles than it is to fly to San Diego on that same flight and connect to London even though that is about 50 times further. Do airlines even have a pricing strategy?

The biggest point of confusion for people is that they are assuming airlines are charging fares based on the cost of providing that seat. While in other industries, most companies would never sell something at a loss. In the case of the airline industry that's exactly how it works. Because airlines are trying to figure out what is the most revenue they can get for every single seat on that plane.

They use all kind of price discrimination techniques in order to get as much as they can and this most fundamentally comes down to differentiating business travelers from leisure travelers. Of course that is painting with a very broad brush and you're never going to fully maximize revenue but the kind of techniques they used to price discriminate are like having day of week restrictions, for example having different fares on Mondays and Fridays vs Tues & Weds.

Sometimes they have Saturday night minimum stays business travelers aren't spending the night somewhere. Often airlines will charge more for a direct flight than they would for a connecting flight. That might seem illogical because you think it's more expensive for them to land and take off. But they know that people are willing to pay a premium to fly non-stop especially business travelers.

This is why you will typically see if an airline has a hub somewhere, that the tickets are the most expensive on them to and from that airport because they know that if they have the schedule & a lot of non-stop flights, that business travelers are willing to spend more on those flights.

Some of the airlines can price discriminate based on the market your originating in. Airlines know that different cities has different levels of disposable income and have different levels of business development. As a result you might find for example a flight from New York to Columbo Sri Lanka is going to be significantly more expensive than that same routing in reverse.

The idea is that if the airlines know there are going to be empty seats, they are still going to try & sell them even if it's at a loss. This is why we sometimes see such cheap business class in economy fares.

So if you see a $500 round trip ticket to China unfortunately that's not even covering the cost of your seat really on that plane. But t they're doing that to fill the plane because the people who are really paying the bill for the plane are the business class travelers who are spending an outrageous amounts for those seats.

For example there are people who are spending $10.000 - $15,000 on business round trip tickets whether from the US to Europe or Asia. It's those few people who are booking those very expensive seats who are really paying the fuel bill, helping the airline make money. While everyone else is just trying to cover a portion of the fuel.

To sum it up airline pricing really doesn't make sense and it's not supposed to make sense. Airlines are using all kinds of complex techniques to price discriminate based on how much they think you are willing to pay. For airlines pricing strategy it's all about what is the most they can get out of every single seat. Sometimes they are going to be making money on you and sometimes they are going to be losing money on you. But it is still better for the airline to have that seat full than empty.

It is a constant battle between trying to get the plane as full as possible and trying to get people to pay as much per ticket as possible. airline pricing model

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About Ben Schlappig:

Lucky has been a travel blogger for over a decade and has flown over 4 million miles, visited more than fifty countries on six continents and has spent thousands of nights in hotels. He’s been chronicling his thoughts One Mile at a Time since early 2008.

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