Airline Mogul Forum

Profit Problem

kentip

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on: July 18, 2007, 11:42:13 am
I and Singapore Airlines both discovered that even we were operating that route in the same amount of price, the latest one who turn to that price always get 100% Loadfactor while the other one will just get 60%-70%.

Any ways to solve that problem?

Thanks
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Singaporeair

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Reply #1 on: July 18, 2007, 11:44:27 am
And the capacity of that route haven't been fill yet!
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Air Elbonia

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Reply #2 on: July 18, 2007, 04:21:05 pm
It can happen.

if you want to accelerate finding a true equilibrium point between the two of you, probably should try finding 100%lf for freq+.5, set the frequency back down .5, and then the other match it.

100% lf tends to wind up at the maximum possible (or close to) ticket price by most players, now typically if anything happens to disturb that (just a few seats get used up below them) they start to slip relatively fast on LF.  faster on lower demand routes, slower on high demand routes.  Whoever comes in second winds up trying to balance over the leftover demand.  I'm betting as you two have driven each other down a bit, that 60 range has gotten closer to the 70s (unless a third competitor hops in).  the route cannot (from your description) support both aircraft, of that size, at that ticket price in a similar fashion as to how the ticket price would drop at higher frequencies.  add a little overhead to calibrate yourselves... and you should be a lot coser to 100/100.
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