For Immediate Release!
January 10, 2002
ACTE Sees De Facto Airfare Rationalization In United's Most Recent Business Fare Cuts And Relaxed Restrictions
Alexandria, VA (Jan. 10) -- United Airlines' decision to cut most business fares on routes in and out of its Chicago and Denver hubs by up to 40 percent -- coupled with an easing of many restrictions normally applied to business fares -- constitutes a de facto acceptance of airfare rationalization, according to the Association of Corporate Travel Executives.
"These fares, and even lower seven-day advance purchase fares enacted by United, shows the carrier has made business travelers a new priority, a position we wholly support," said Mark A. Williams, ACTE president. "The fact that United says these changes are permanent constitutes the basis of a new pricing philosophy that narrows the gap between leisure and business fares while eliminating penalties for making last minute arrangements. In essence, this is a de facto kind of airfare rationalization."
Williams added that American Airlines' move to match these fares on competitive routes might be the start of a long-awaited domino effect on other carriers struggling to regain business travelers. "This is a major 180-degree swing from a month ago, when carriers were looking to impose further restrictions on business travelers."
ACTE's president described this incremental approach to airfare restructuring as "shotgun rationalization," a progression of logic spurred by the potential for bankruptcy, new competition from low-cost carriers, and increased belt-tightening on the part of corporate consumers.
"It's not important how we get to a rationalized airfare structure, as long as we arrive with the nation's air transportation system intact," said Williams.
Williams emphasized the importance of a plan. "We have several airlines charting new territory restructuring both airfare and cost structures, and others responding to the resulting competitive pressure. What we need is sound rationalization, not the basis of a price war."
For more information, contact:
Jack Riepe, ACTE Communications
1-610-256-0124 or [email protected]
Founded in 1988, the Association of Corporate Travel Executives (ACTE) is a member-driven organization wholly dedicated to the science of business travel management with an international constituency. ACTE membership totals more than 2,400, including business travel executives in Asia-Pacific, Canada, Europe, Middle East, Africa, Latin America and the United States. The organization is headquartered in Alexandria, Va., with regional offices located in Brussels, and Singapore. ACTE's web site is www.acte.org.
