United unveiled their plans for Basic Economy fares at today’s Investor Day in Chicago. The new Fare Class is going to debut in Q1 2017 (as its own selling class) for flights that will operate starting in Q2 2017.
Here are the “basic” need-to-knows about Basic Economy
- Seat assignments will take place at check-in
- Carry-on bags are limited to a small personal item (laptop, purse, backpack, hand-bag) unless they are a Premier Silver and above member, Star Alliance Gold member or a qualifying MileagePlus Credit card holder)
- Group 5 boarding (unless a MileagePlus Premier, Star Gold or Credit Card holder)
- No voluntary ticket changes (24 hour flexible booking policy excluded)
- No Premier-Qualifying Miles, Segments or Dollars earned, nor lifetime miles or contribution to the four-segment minimum (customers will still earn redeemable miles)
- No EconomyPlus nor Premium Cabin upgrades
- No combinability with regular economy fares or partner carriers, nor interline travel.
Why I think these policies are fair
Simply put, in the Bitcoin era, United is streamlining its Economy Class product to be able to compete effectively with ULCCs such as Spirit, Frontier and Allegiant. This is not news. While some perks are indeed lost, not all of the restrictions are that “restrictive” after all. Here is why:
- Having a United-qualifying credit card, much like the first checked bag fee waiver, even for non-elites, permits a customer to bring on a roller-board and board in an earlier group
- There is still a 24-hour cancellation window after booking
- Even with unassigned seats, United’s seat pitch is still more generous (30-31″) than Spirit (28″) or Frontier (28″).
- It is also possible, through a stroke of luck, that unfilled EconomyPlus seats will get assigned to customers in BasicEconomy (but that’s still TBD based on how United configures its system)
- Customers will still be able to access United’s Private Screening on Wifi-equipped flights (which are fairly widespread nowadays) on Personal Entertainment Devices (PEDs), which is not the case on most ULCCs.
- Customers can still earn redeemable miles.
As someone who has flirted with ULCCs significantly in the past, I can vouch for the fact that none of these deviations would really spurn me from opting for BasicEconomy if it allowed me, or my family, to save significantly on air travel.
Yes, the absence of Elite Qualifying Miles is a bit frustrating, but to be quite honest, staying on the fast-track to earning (and maintaining) Elite status with any airline has become more and more challenging each year. This is a realization that points junkies are just going to have to come to terms with over time. Besides, the perks of even the most basic tiers of Elite Status are so watered-down at this point, it’s probably sufficient to just invest in a credit card that accrues points through everyday spending, pay the $95 annual fee, save on bag and carry-on fees, and basically just let it ride.
All said and done, this product is perfectly fair and rational
I honestly think that United’s approach to the BasicEconomy product is reasonable. It is also refreshing to see United become a first-mover in launching a new product in the back of the bus that doesn’t emulate Delta or American. I also am part of the camp that believes this will (hopefully) cut back on the issue of queued passengers lining up on a jet way as the last group of travelers wanders about the cabin to stuff their carry-on in a compartment space, although Ben appears to disagree with this prediction. We’ll have to see how things pan out. I know from personal experience, over the years, I have become adept at packing light after being groomed on my Spirit spree.
There are still several unknowns about how United will market and sell the product. For starters, I imagine that they will initially, “test” it out on a select number of short to medium haul routes from major hubs to leisure markets, or ones that overlap heavily with ULCCs and LCCs. After working out those kinks, they may then expand the product to longer-haul and possibly international flights. After all, with carriers like Norwegian, Air Canada Rouge, WestJet, WOW Air and Icelandair expanding into the long-haul, low-cost space on transatlantic flights between North America and Europe, United can now compete in this space with the BasicEconomy product.
Furthermore, it is unclear how United will bundle the product into its Award Space categories (if at all) and actually price the product. Will United’s current Economy Class fares be re-structured to BasicEconomy, then move up from there? Also, how much will they charge for carry-on bags at the gate for customers who were unaware of the policy? I imagine that there will be some leeway given during the transition phase as more customers become aware of the new rules.
Lastly, the Investor Day presentation also indicated that United is now evaluating Premium Economy. While American and Delta have beat them to this race, the logic follows that United will eventually enhance the EconomyPlus product to become something beyond extra legroom.
Moreover, bottom line is that we live in a time where flying is incredibly inexpensive. Yes, customers complain about lower standards of service than before, or having to pay for extra amenities, but if that enables them to travel more, then sometimes its best to just accept the rules and move forward.
Value-based travelers, your world just became smaller.
