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Reexamining the International Upgrade Issue

A great amount of time has been spent complaining about Delta’s policy for international upgrades – that is, upgrades on a product with BusinessElite, where BusinessElite service is provided.  No real amount of change has been seen with this product.  The relatively recent addition to standby when an upgrade seat is not available at booking changes nothing – when it comes to the price of a ticket that is eligible for an upgrade.   What if a plan was introduced – a plan that actually made some sense?

After a quick review of the existing rules, I provide some thoughts on a new plan.  I think it merits a discussion.  There’s no guarantee of an error-free analysis below, so please, chime in and correct me where I am wrong.

The current situation:

Fare Classes

For travel to all markets, Delta sells economy tickets in 10 fare buckets.  I haven’t included any upgrade buckets, business fares, or award fares.  If you have never seen this chart about DL fare classes, it’s definitely an interesting read.  There are other cool tools for all airlines on that website, as well.

Y, B, M – the most flexible and expensive of the fares.  A wide variety of rules exists within these fares.  These are the only fares that are eligible for upgrade into BusinessElite.

H, Q, K – the middle of the road fares.  These fares, plus the Y, B, and M fares, are eligible for upgrade domestically using a SWU or miles.

L, U, T, and the fairly new E – the highly restricted, no advance upgrade fares.  These fares are only upgradeable through the unlimited domestic upgrades product for Medallions, which excludes Hawaii.  Hawaii upgrades require Y, B, M, H, Q, or K, and a SWU or miles, along with G availability.  Y, B, M, H, Q, and K also are upgradeable through the unlimited domestic program.

Anything that happens with KL, from domestic to business, or AF from either economy to premium economy or premium economy to business, is a separate issue, and one that won’t be discussed here.

 

Upgrading to Business Elite

There are two ways to upgrade a paid ticket into Business Elite for Platinum and Diamond medallion members, and one way for anyone else.

For either method, a seat in the Z bucket must be available.

For Diamond and Platinum members, a ticket in Y, B, or M must be booked.  A phone call is then made, and again, assuming Z availability, the upgrade is confirmed.  If someone is flying on the same itinerary as you, you can use a SWU for them as well, provided there are enough Z seats available, and that their ticket is in Y, B, or M, as well.  Their other traveler’s SkyMiles status is irrelevant.  SWUs are non-transferrable, period.  The transferability issue is another issue for another time, though.

For everyone else, including Diamond and Platinum members that don’t have or don’t want to use SWUs, a ticket in Y, B, or M must be booked.  A phone call is then made, and again, assuming Z availability, the upgrade is confirmed.  The miles debited from the account are slightly less for Y than they are for B or M.  Theoretically, you could book as many people as you wanted on the same locator, and upgrade all of them using miles, if the Z seats are available, regardless of the SkyMiles status of any party involved.

If the Z seats are not available, they will put you on a standby list.  These get cleared at the airport, on a space availability basis.

So, where are the issues here?

  • Y, B, and M tickets are expensive.  One rarely sees a Y, B, or M ticket for an overseas flight that costs less than $2,200 round trip.  The average price is probably closer to the $2,500 - $2,800 range, which is just as high as the discounted I fare business tickets.
  • Delta’s primary competitors in this market, which here is defined as “legacy carrier in the US that transports overseas”, are United and American, which offer tickets that are upgradeable and much less expensive.  Read Matt or One Mile at a Time.  You’ll get the picture pretty quickly.  Although the transferability of SWUs is, as previously said, not something that will be extensively discussed here, the fact that UA and AA allow transfer simply pours salt in the wounds of the Delta flier.
  • To make things even worse for Delta fliers, Delta will fly a BE cabin out empty, provided economy is not full, before an op-up is offered.  Worse, they will pack it with non-revenue passengers.  I’m all for offering employees the best benefits that you can, but not before you serve the customer.  And certainly not before you serve the customer while you are packing the BE cabin with a non-revenue family of five that has an ATL desk-jockey in it.

It’s no secret to anyone that BE upgrade deprivation is the core of the Delta revenue generation plan.  They attempted to address this with the Economy Comfort seats, putting DL on course with AF, KL, and UA.  But a little more pitch doesn't solve the problem – solving the problem means making flat-bed seats – which are being installed at breakneck pace – available at a reasonable price to loyal customers.

Where could improvement realistically be made?

What if Delta actually thought about what there loyal customers wanted?  There are an infinite number of ways to change the program. 

  • Fare criteria changes: adding some fare buckets to the list.  H, Q, and K could be made BE-upgrade eligible, mimicking the domestic fare classes available for upgrade.
  • Medallion status criteria: Diamond and Platinum customers could be the only customers that could avail themselves of lower bucket upgrades.  H, Q, and K could only upgrade with a SWU, as opposed to miles.
  • Combinations of the above:  H, Q, and K could be made eligible for all passengers for miles and SWUs.  H, Q, and K could be miles or SWUs, and only for Medallions.  The options are limitless if you break H, Q, and K apart, and look at Medallion levels for eligibility.
  • A final thought, although probably not a reasonable one, is to not only allow advance confirmed upgrades, but to offer a domestic style program at the gate: if space is available, people move up.  This, too, could be limited by Medallion level and fare class.

The bottom line is always the question – what revenue would Delta gain or lose from such changes?  Would Delta gain passengers, who would enjoy the service and in-flight product (that lacks at UA and AA), and who would otherwise be a lost stream of revenue?  Likely so.  Would existing customers buy a higher class ticket for a shot at an upgrade?  Likely so.  Would Delta lose revenue on Y, B, and M tickets?  Possibly, but not if appropriate capacity controls were put in place.

Where does it go from here?

 

Follow me on Twitter: @SBMechanics

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