8 replies to this topic

[Jimmy V]

It is already mentioned by other guys but I also want to give a specific example showing why the seats/price calculation needs a new script since this one is faulty defined. Lets say that a route has a 9 pax FC demand (I refer to FC because of lower numbers the problem is more evident) and I offer 7 seats. Now if someone else comes and offers 11 seats with the same price exactly we will loose almost 50% each (unfortunately because IFS and total reputation has almost none impact but that is an other known issue) and so far so good. The problem is that if I want to lower the price so I will reach a LF of 100% it is not sufficient to lower the price by just one $ (since I have lower than demand offer) but the whole calculation system behaves as if I want to load another 3,5 seats out of 19 which means I have to lower much more my price than I should have to. In other words the script does not take in consideration what percentage of seats each player offers but calculates the seats as a unique lot. The problem is that when you have to compete with guys who believe this is a war game and do kamikazee actions like put 35 seats in 5 pax FC demand don't ruin only themselves but also,by miscalculation, anyone else in the route and you have to follow their stupid game. I hope it is clear what the problem is, thanks

[KJS607]

im a little confused

Not the only one , Jimmy, can you please simplify this as I think we all get lost about half way through, not quite sure what your point is with this one

[pseudoswede]

Of course, people who only drop fares by $1 will see an additional $99 drop by me.

[Mobeer]

I >think< he is saying that if:
demand (as $100 normal price) = 9
His Airline A offers 7 seats at $100
Rival Airline B offers 11 seats at $100
Then both airlines carry 4~5 passengers

He wants to be able to cut ticket price by $1 so that:
Airline A carries 7 passengers at $99
Airline B carries 2 passengers at $100


I'm not so sure this is a good idea (if this is the idea). Otherwise Airline A could destroy B by just constantly undercutting by $1.

[pseudoswede]

Basically what he's saying is that when someone comes in with excess supply, you have to lower your fares such that you represent all of the excess supply with your fares even though you may only be supplying lower-than-normal capacity on that route. In other words, this game does seem to favor airlines with more capacity--even if it greatly exceeds demand.

What he's missing is that the majority of that competitor's excess capacity is represented as connecting pax, especially if the competitor is only matching fares. Even though you may foolish only drop fares by $1, and because you have lower-than-normal capacity for the route, you still have to compete with the elephant in the room with excess capacity (and now even more connecting pax).

[KJS607]

I >think< he is saying that if:
demand (as $100 normal price) = 9
His Airline A offers 7 seats at $100
Rival Airline B offers 11 seats at $100
Then both airlines carry 4~5 passengers

He wants to be able to cut ticket price by $1 so that:
Airline A carries 7 passengers at $99
Airline B carries 2 passengers at $100


I'm not so sure this is a good idea (if this is the idea). Otherwise Airline A could destroy B by just constantly undercutting by $1.

If so, not a great idea This is exactly what happens on AirlineMogul, and why it is so currupt and rubbish

[Jimmy V]

Exactly pseudoswede for the first part, that is what I'm saying but... First apology for the example of $1 it only created confusion. To make it more clear I will use Mobeer's example, but lets say that airline A offers 10 seats and B offers 25 seats in a 10 route demand where normal price is $100. in an equal price of $100 we should have both 50% of the demand, so both Airlines have 4-5 seats .Now airline B lowers the price to $75 and reaches LF 100% which means lower prices have created a new market of 25 (these figures do not include connecting pax, market share presentation does not include them). For Airline A it should be enough to match that price to reach LF 100% (50% of 25 =12.5 above 10) but has again to lower the price almost the same way! So excess creates advantage much more for the airline who created the excess! the logical thing should be that if airline B wants to take the market from airline A to compete also again the excess (in our case against 12,5) and not the opposite. Of course at the end by lowering the prices very much creates market for both but in an unfair, in my opinion, way since airline A has dropped the same way prices and has 5 seats while the other one reached 20-25 seats. So the whole thing benefits those who, in routes already more than full,with 2-3 airlines already in, put more than 3 times the demand seats, and because of what i described and the easy way to make money gives them surplus instead of a logical bankrupt and that behavior I think is even more foolish than the $1 fare drop (which by the way is foolish enough )

[QK Flight Industries]

Perhaps this will be implemented in AE4, along with the new demand calculations...

[Ioh]

Th thing is, by overloading in frequency, you offer pax more times, in reality pax like convenient times, however if there's a flight $1 cheaper at 1am, they will go for the more expensive option. Slash the cost by $50 and they'd be more inclined to change.

However, IFS/IFE has a highly unrealistic effect, it just doesn't sway them enough.

The game has its goods, and it has its bads, but its free so just put up with it for now.