Companies Say No to Basic Economy Fares

When companies set policy guidelines for their business travelers, many of them have traditionally required employees to book “the lowest available air fare.” But now that is changing.

Why? Because major airlines have deployed highly restrictive Basic Economy fares on many domestic routes in recent months, and are now spreading them to international routes as well. Those are now the “lowest fares available” in many markets, but they are hardly the most business travel-friendly.

As a result, a number of corporations are now telling their corporate travel departments and travel agencies to block Basic Economy prices from their air fare searches for business trips, according to a report from CNBC.

The new bare bones fares are aimed at the most price-sensitive travelers, and typically do not permit the kinds of things that business travelers expect – like frequent flyer miles, early boarding, access to the overhead bin, refunds for canceled flights, and so on.

CNBC said it found out that 75 percent of one mega-agency’s corporate clients now block Basic Economy fares, and so do all the companies that use a major online corporate travel website. It said that 42 percent of SAP Concur’s 38,000 client companies have also blocked Basic Economy fares, which means they won’t even show up in fare searches on company travel sites or apps.

That’s actually good news for the airlines, since they have sometimes admitted at various conferences that they don’t really want to sell Basic Economy tickets. They offer the fares in order to remain price competitive with fast-growing low-cost carriers (like Frontier, Spirit or Allegiant), but they really hope that all the restrictions on the fares will convince travelers to buy a higher-priced ticket that comes with more inclusions.

(Travel Skills)

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