A Geneva-New York round trip for less than 500 francs is the latest advertising campaign from Swiss, which is selling off its flights to North America. Despite inflation, some airlines are slashing prices. But how do they manage to offer such prices?
The poster is beautiful, the trip is attractive and the price is undoubtedly unbeatable: the airline Swiss offers a Geneva-New York round trip from 420 francs. Other low-cost fliers also continue to offer very low prices from Switzerland: 25 francs for London or 38 francs for Sicily.
These prices could suggest that airlines are not affected by inflation. However, the price of kerosene is rising, cabin crew has been increased and the price of spare parts has gone up.
With its offer, Swiss offers an economy class fare three times cheaper than before the Covid-19 pandemic. “It’s aberrant,” said Stéphane Jayet, vice-president of the Swiss Travel Federation, in La Matinale, specifying that company prices are very “evolving”.
According to him, Swiss’ campaign is used as a marketing element to raise awareness. “We tell them: ‘Why not travel with us to the United States’. People will perhaps travel with them once, but the prices will no longer be as low, it will perhaps be 1200 or 1800 francs. So it’s more to motivate or arouse possible interest in going to a destination served by Swiss.”
Price opacity
But what is the recipe for charging such low fares without jeopardizing the future of airlines? It is difficult to analyze the strategy due to a certain opacity in the airline sector. To keep prices low, airlines communicate their pricing policy relatively little, as confirmed by Pascal Perri, economist and specialist in pricing policies.
“For example, we know that a Boeing 737 can travel with around 190 people on board, and we would like to know the average price. For a full cabin, there is certainly not a general low-price offer. It is a call price,” he explains.
Only a handful of seats are therefore affected by these very low prices. According to Pascal Perri, ticket prices remain generally higher than before the pandemic, particularly for long-haul flights.
cr/jfe
2023-11-03 15:14:59
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