United Basic Economy Tickets Are Now On Sale (And Being Marketed Dishonestly)

Earlier today American began selling basic economy fares, and now United is selling them as well. This isn’t coming as a surprise, given that both American and United have already revealed the full details of these fares, and we knew they’d start selling them around now.

However, with American I get the sense that they’re sort of embarrassed about introducing them. They realize it’s not good for customers, but they’re going to do it anyway, because money. However, United actually seems to want to convince customers that basic economy fares are good for them. Ironically, United is also being the strictest of any carrier with these basic economy fares, as:

  • You won’t receive any elite qualifying credit, meaning no elite qualifying miles, elite qualifying segments, or elite qualifying dollars
  • You won’t be allowed to bring on a full sized carry-on, but rather will be limited to a personal item (there’s an exception for elite members, Star Alliance Gold members, and those with United’s co-branded credit card)

united-lounge-london-heathrow-62

As of today, United basic economy fares are bookable for flights between Minneapolis and United’s hubs. Best I can tell, these tickets are on sale for travel starting April 18, 2017. The summary at the top of the press release reads as follows:

New product will provide a lower-fare option with most of the same inflight services and amenities that are available with standard Economy

So United is claiming that these basic economy fares will usher in “lower-fare options.” Hmmm…

Then the press release quotes Scott Kirby, United’s president, as saying the following:

“The launch of our Basic Economy product is transformational –  offering customers seeking the most budget-conscious fares United’s comfortable and reliable travel experience across our unmatched network of destinations,” said Scott Kirby, president of United Airlines. “Basic Economy lets you go where you want to go at our lowest available fare while enjoying United’s Economy cabin and the exceptional inflight service that comes with it.”

Transformational for… customers… or shareholders?

I’m actually not sure how this type of marketing is legal, as it’s patently dishonest. United claims that this new option provides a “lower-fare option” than before. But that’s simply not true.

Check out the economy fares between Minneapolis and Denver before basic economy is introduced:

United-Basic-Economy-1

And a week later, after basic economy has been introduced:

United-Basic-Economy-2

There’s no doubt here that basic economy fares are simply replacing the current entry level economy fares.

This is true across various markets. United hasn’t suddenly introduced lower fares than before, but rather is reducing the benefits that come with the most basic fares.

Keep in mind that United is also being the most restrictive with basic economy fares, and doesn’t offer any elite qualifying credit on these fares. When you go to book a basic economy fare, you’ll see the following warning:

Basic-Economy-Fares-3

Bottom line

I know it’s never going to happen, but I wish we lived in a time where airlines marketed honestly.

“Hey, we’re raising our fares because we can, and because it’ll generate a billion dollars in incremental revenue, and that’s how we make money. Everyone else is doing it. If you want to pay the same as before, you can, but you’ll get a lot less.” But instead we’re being told that customers are being offered a transformational new lower-fare option, which in reality is the same fare as before, with fewer benefits…

Comments

  1. Absolute f***ing shysters, the lot of them. I hope the next recession sinks every single legacy carrier into the dust.

  2. Will Star Alliance Silver members be exempt from the carry-on rule too? Previously United gave Star Alliance Silver members Group 2 boarding, but they are enforcing the new basic economy carry-on rule by putting passengers who purchased basic economy in Group 5, so I wonder if Star Alliance Silver members purchasing United basic economy will be exempt, or if they will lose Group 2 boarding privileges.

  3. If I’m playing defense for UA:

    1) Standard Economy fares would have increased $20 in one week regardless of the introduction of Basic Economy. There would be no way for you to disprove this. Since you’re claiming UA is lying, the onus is on you to show standard Economy fares would not have increased $20.

    2) “Transformational” is a meaningless word. I could spray diarrhea over the bulkhead and say I’ve made a transformational change to the airline. An enhancement, even — just ask certain fetishists. (Shudder!)

    My point is I wish airlines were not simply honest, but ethical. What UA has done here is obviously unethical, and it is an insult to customers to call Basic Economy transformational. It also shoots themselves in the foot because when they introduce an actual future enhancement on the scale of Polaris, there is one fewer word they’ll be able to use.

  4. Wow!! Guess you won’t get an invitation to Scott Kirby’s Xmas Party anytime soon! Haha.. Have you compared AA’s new prices? Thanks for this info 🙂

  5. Wow thats just awful. United is obviously being dishonest. Apart from that though, the actual fares, and conditions feel more like punishment than travel.

  6. Lucky wrote: “I know it’s never going to happen, but I wish we lived in a time where airlines marketed honestly.”

    Well we do—we have snowflake economy and the “progressive” Frequent Flier Mile programs now, all to create anger and hate. American, Delta and United are really just 1 airline, much like Kellogg’s, Post and General Mills….all 1 cereal.

  7. I think this will lead to higher load factor on WN flights as the public will just fly WN and avoid the legacy carriers.

  8. No, you’re the one being dishonest…

    “United claims that this new option provides a “lower-fare option” than before. But that’s simply not true.”

    Where have they claimed that? The fact you didn’t include “than before” inside the quotation marks implies you know they haven’t.

  9. I wonder how much this will change loyalty behavior above Premier Gold members? Last year with the higher revenue requirements I saw no noticeable change to 1K ranks. I’m still often >10 on the upgrade list between large hubs on a mid priced fare and in practice (for myself) I was around $35k in spend last year. Nowhere near the threshold. So for their semi profitable customers I wonder if this changes things?

    I would on the one hand imagine it wouldn’t change work bookings but would infuriate people when traveling for vacation (as it does in my case) but on the other hand when you have status, why not pay a bit more for regular economy to get full benefits vs restricted economy on a carrier where you don’t have status? Their tricks have worked on me before as I now pay more for the correct fare class internationally to guarantee I can use a GPU… it’s still cheaper than regular business class fares.

  10. This is the final nail in the coffin for me. United has disappointed many times but now it’s time to say goodbye! I find it hard to get over blatant disregard for dishonesty to consumers.

    Thanks for reporting this!

  11. These criticisms strike me as overwrought. They are responding to market reality — namely that a huge percentage of customers won’t pay a premium of even $20 to fly on United over, say, Spirit or Froniter. By introducing a cheap option with fewer benefits, they’re giving people what they want.

    I do think it’s fair to say this is a cheaper option. While at the moment it’s effectively the same price as they’re currently offering, just with fewer benefits, over time they probably couldn’t afford to charge Spirit-level prices while providing even slightly better service. It’s a super-competitive, commoditized industry where every dollar counts. By aligning the service to the low price charged, they can continue to offer the lowest fares over time. This sets a new competitive equilibrium so at the margin you might see slightly more competitive pricing as carriers adjust their fares going forward.

    By the way, if you don’t like it, don’t buy a basic economy fare. It’s $20 more each way — and for that $20, you’ll probably find it a lot easier to find overhead space for your carry on than you otherwise would, since a decent percentage of the people on the plane will not be allowed to bring carry-on luggage.

    In general, the airlines make next to nothing in terms of return on investment. Compared to tech, real estate, law firms, finance, etc., they are terrible businesses. Contrary to popular belief they are not NGOs. They do actually need to make money for their shareholders. It’s difficult for me to sympathize with people who basically just want the airlines to hand out goodies for free as if they have some kind of moral obligation to the world to operate at a loss. Space on an airplane is a precious and valuable commodity. If you want more space and better device there are ample options available to you to purchase that. If you don’t, then enjoy the money you’ll save with a cheap ticket.

  12. @ John — Scott Kirby, is that you? 😉

    The most basic problem with your argument is that at the moment United ISN’T matching the cheapest fares of Frontier, Spirit, etc. The fares of the ultra low cost carriers are significantly lower. Frontier has tickets starting at $46 between Minneapolis and Denver. United tickets start at $69. Between Minneapolis and Chicago, Spirit has tickets starting at $36, while United has tickets starting at $56.

    Otherwise your argument is perfectly fine, but I struggle with how you’re justifying it. It’s *not* a cheaper option, but rather they’re trying to increase their profits, because they can. But that’s it. That’s fine, but let’s call it what it is.

  13. If you book basic economy for you and your family – they will not seat you together even by default; requiring you to choose full economy to be able to sit next your spouse ? Is this true ?

  14. I wonder how business travelers will be impacted. I know every company and travel booking company is different, but I have a sneaking suspicion that my company will be embracing these “low fares” since they think squeezing blood from a turnip provides a good ROI. Being 7K from Gold last year due to more local projects, and being asked if I wanted to fork over $1200 to get Gold, I’m not seeing any good reason to continue with United at this point.

    Now, looking into my crystal ball, I have a feeling that United is going to start offering add-ons 24-72 hours prior to departure. You’ll get an e-mail that asks you to shell out $20 to pick your seat early, or maybe when you check-in a notification on the screen that you can shell out $40 to board in group 2 (like the business select offer on Southwest) and/or have a carry-on.

    Flying on United just sucks anymore. 50% or more of the plane is Group 1 on any flight to a major city out of Denver. 45% are group 2, and most because they have the credit card. I actually had to check my carry-on the other day because I boarded toward the end of Group 2. So far this year I’ve only snagged two E+ seats, opting for my aisle a few rows from the crapper over a middle E+ seat. And the last one my carry-on was actually over row 30 something while I was in the row right ahead of the exit row.

  15. Lucky, I’m surprised no one’s mentioned how United banned you and this is:
    A– and attempt to strike back at them, or
    B– going to make them angrier so they start in forcing their ban again.

  16. Someone show Scott Kirby those 2 screenshots of prices and tell him to explain what’s transformational for the customer. Oh wait, John already replied.

    Seriously, this is the worst implementation of basic economy. Can’t believe I’m saying this but they’d do better to copy Delta.

  17. So my backpack counts as a personal item? And not as a carry on?

    These fares would work out ok for me, if they were actually lower.

  18. I would say it’s actually some kind of honesty on the side of United. I mean they clearly show us they’re simply going to charge more for the same stuff they sold yesterday for less. If I were Scott Kirby I would lower fares for basic economy the day basic economy is introduced. So that UA would actually have good reasoning for what they claim right – new value proposition, lower fares, bla-bla-bla… Plus definitely some good publicity for lowering fares. Then over a course of 3-6 months I would bring basic economy fares in line with the lowest economy they had had before basic was introduced (since this is the clear aim). That’s actually what I expected from big corporates to do.

  19. The average passenger will purchase the least cost ticket without knowledge of the fare. The average passenger will purchase the least cost ticket, call to request seats (and be denied due to fare), call to request seats with the family (and be denied due to fare), call to request seats with the family and question carry on allowance (and be denied due to fare); call to request seats with the family and question carry on allowance and note the missed flight due to sick child (and be denied due to fare). The average passenger has average expectations and I suspect the new fare will not meet the average expectations.

  20. United does not expect or want to sell very many basic economy tickets. The BE fare class is designed to be a “scarecrow fare” that gets people horrified about how little basic economy offers and then, transitively, it would expose just how ‘shitty’ “similar service” or lack thereof offered by Frontier, Spirit, etc is in relation to UA’s standard economy. Therefore, the whole point is to get people to buy standard economy tickets by scaring them away from both their own basic economy and low cost or budget carriers.

    The truly unethical aspect of this ploy is the deceptive marketing — clear in Scott Kirby’s hyperbolic language — which wants to make you believe that basic economy tickets cost about the same as tickets offered by budget carriers (false) and that they are much cheaper than their own standard economy tickets (also false).

    The result will be that the ploy will “generate a billion dollars in incremental revenue” as they boldly stated. It will be $20 more here or $5 more there earned as folks shun BE tickets in favor of standard economy. Voila, Mission Accomplished!

  21. The most dishonest part of that statement was “…United’s comfortable and reliable travel experience…” – Oh that’s rich…

  22. How about a similar analysis of fares for American and Delta before saying United is the only dishonest airline. Personally if you thought anything different than this was going to happen im not really sure what you expected.

  23. ’twas failry obvious this is what would happen. It ain’t exactly analogous, but there’s something akin to the 1% who pay close attention, and there’s the masses, some of whom purchase an airline ticket once every year or two (who won’t notice until some particularly irritable gate agent decides to charge them for their carry on). These types of shenanigans by corporate creeps are par for the course, especially in these times of solid profits for the airlines. Kinda like fuel surcharges that don’t go away when fuel drops to a third of what it cost when they were implemented.

    Our little capitalist experiment, run amuck.

  24. @ Adam — No, the same exact thing has happened with American, Delta, and United. However, it’s the way that United is marketing this change that I’m put off by. I don’t think American spinned this to the same level that United did.

  25. Agree that the marketing is disgusting, but it’s not dishonest. UA is not claiming that BE fares are lower than before. They are just claiming that BE fares are lower than the other available fares – which is true.

    As a frequent traveler, for work, I am a fan that these fares in are in the market. I will never buy one, but I am quite happy for others to do so.

  26. This is clearly written to be dishonest without being illegal. When uninformed people read “transformational” and “lower cost, budget-conscious fares” they are going to assume that they are now getting a discounted fare, meaning lower than it was before. When in fact, as I said yesterday, the true slogan for this should be “pay the same, get less”.

    I see multiple problems with this. First, uninformed customers will buy at this fare without realizing what it entails. Then when a family of four arrives and finds they are assigned the middle seat of 5 across, all in different rows, they are going to be really upset. So they’ll ask to change to regular economy and pay the extra $20 each, only to be told “sorry, this fare is non-changeable, non-refundable”. ie you are stuck with it by design. They are going to be very upset.

    And since nearly everyone who wasn’t planning to pay to check a bag, and doesn’t have the cc or status, will now need to pay to check their carryon, it won’t even be cheaper than regular economy. Meaning after paying to check their carryon they will now be stuck paying the regular price, yet getting the inferior service.

    And how about for business travelers whose company policy requires paying the lowest available price?

    All of these people are going to be very angry at United. If the intention of this program is to piss their customers off, then it is “transformational” all right. But if that wasn’t the intention, I think they are shooting themselves in the foot. 😉

  27. I hate the fact that I am captive to UA on routes from SAT to IAH and SAT to SFO (nonstop). Hey UA! Keep degrading the flight experience and I’ll move heaven and earth to fly SW or Alaska. I’ll even drive up to AUS and fly Jetblue. In other words, if you want me to avoid you, even to the point of inconveniencing myself, just keep it up.

  28. Unfortunately deceitful advertising is rampant and somehow it flies under the regulatory radar that it is place to protect us from these schemes. Thanks for pointing it out.

  29. Nothing that American or United does will ever satisfy you people (but Delta is a god among men for some reason). If you don’t like them, don’t fly them. Done.
    An over-eager exec isn’t maliciously lying and plotting against you like Mr. Burns, it’s just some dude on an earnings call trying to sell a product he’s paid to sell. They are selling their cheapest available fare and they are marketing it as their cheapest available fare, because that’s what it is. How is that dishonest? They took away the ancillaries, but they let you know that and they have let you know that since day 1. I really am confused as to why you’re surprised by this.
    You’re getting all bent out of shape over the semantics of “a lower-fare option” when technically, anything below a full economy fare is a lower-fare option so… yeah. I can’t with yall.

  30. Clearly UA are *testing the waters* in a single market here, and using a simple mechanism of “if you want a normal ticket it’s $20”. What I would imagine will happen next is that they will use this as a product that allows them to compete with low-fare carriers in certain markets, but not all markets.

    This is exactly what BA do in Europe with their ‘Hand Luggage only fares’, and I think while Air France KLM also have their Transavia Spin-off, they too do this on main line routes. Where that route doesn’t compete with Ryanair, you’ll find it’s simply €20/£20 cheaper. Interestingly, where BA are/(were?) competing with Aer Lingus or a full fare airline, their ‘normal economy’ fare was a single €1 more expensive than basic economy, so ultimately, if UA use this well, it’ll be really good for consumers and will give everyone what they actually want.

    A lot of travellers have zero interest in miles, points and premium cabins, and research has shown that they will often buy a ticket that appears cheaper despite costing significantly more in ancillary fees (this is Ryanair’s entire revenue model until 2015), same goes for hotel rooms hence resort charges, etc. It is deceptive sometimes but if you look at Ryanair/BA NOW (and not in the past when there were deceptions), then it’s a brilliant system that works, and therefore can be quickly learnt from.

  31. just adds to the chaos and confusion regarding economy “light” in Star Alliance: Lufthansa and associated carriers do not offer any checked bags for Star Gold passengers on light fares, TAP and SAS do offer a checked bag ( although in the case of TAP it’s not clear at the time of booking). An itinerary with some that, some that don’t is a pain.

  32. If United can simply call their lowest price fare Basic and not lower the price while offering less and still fill their planes then more power to them.

    Why would you berate them for taking advantage of a situation?

  33. I think “basic economy” is merely the airline’s way of charging for carryon luggage and seat choice. I have been flying for years. In the beginning, 2 luggages were free. Then one was free. Then a single luggage cost. Then it cost more. None of that bothered me that much the last few years, when the seats became closer together, to the point that getting stuff from under the seat for my kids became a struggle. Also, people started fighting over luggage space overhead. I once flew Delta with 3 of us total, one carryon, and there was no space left overhead for me and I had to check it.
    I solve my problems by flying Delta comfort only. I think “basic economy” is a great idea. It reduces the number of carryons so that there shouldn’t be this big fight for overhead space, and air trips can be a little less pathetic looking.

  34. You should refresh your article (dated February 21, 2017) yet it is posted on Skift today, April 24th.
    Your UA chart is what’s misleading or dishonest to the readers here. Again, you posted in February and probably on a weekend date ?. If you look at today’s date, the Basic Economy fare in this market (MSP-DEN) is as low as $44 (not all flights, not all days of the week but nevertheless can be as low as $44 on applicable flights). I’m sick of everyone maligning United without the facts.

  35. With my celebration of 30 years at a major consulting firm this June, I know I have been a pretty loyal member of United’s Mileage Plus Program for more than that as I joined when I was in college in Texas. When my husband and I were dating and needed to make sure we both picked the same airline. Being from Chicago, we chose United, as the hometown airline. So much for loyalty and status.

    I was stunned when I went to book at ticket to LAX today to visit my son at USC and selected Basic Economy and a window popped up that I said I wouldn’t earn and PQM, PQD, or PQS, and nor could I select my own seat. As a million miler flyer, I don’t need the lifetime miles but if I did that would also be shocking. Having Platinum or Gold Status for the past few years, and not getting any of these benefits is shocking and disturbing. The primary reason I stay with United is to have these perks. What are you thinking United — punishing your most loyal travelers who are trying to save money. My company has us select the lowest fare and typically I can justify United if it is a little bit more but now without any perks, I can’t make that justification and nor would I want to do so.

    I have always been told to switch to Southwest and put my miles toward earn a free companion pass (which I can easily do between travel and the credit card) and be treated better and save money. It seems like a compelling option if I can’t earn status by choosing fares that helps stretch my travel budget. I hope someone thinks about this a little bit harder and that a change is made quickly before you lose more customers.

    I found a quote from Scott Kirby that he recently said “Our best customers started abandoning us and flying on the competition, who had a better product,” Kirby said. “We have to turn that around.” It doesn’t look like this is a way to turn things around in a positive manner.

    If United wants to become a Spirit or Frontier Airlines, you are well on your way because I am sure many of your “Premier” travelers will find better options than to have their loyalty not rewarded.

  36. What happens to my United Economy ticket purchased in December 2016, for an international flight in September 2017? Will it be downgraded to a Basic Economy? Will I only be allowed 1 personal piece of luggage, and no carry on luggage? Can’t find the answer to these questions on any of United’s sites. Can anyone help me with this please?

  37. One more thing for travelers which is not mentioned in the post… If you book basic economy you **cannot** check in online and have to be at the Kiosk to print the boarding pass after getting help from a representative … what a pain in the A**… They are not making it low fares n making to pay more if u r checking a bag.. United sucks….

  38. Recently purchase this ticket. I read the warning page, but I don’t think it sunk in. Any way I ended up needing to change the flight day do to a family emergency. The response I got from United – sorry about that, but you lose your money if you don’t get on the plane when you are scheduled. In their eyes there are no life emergencies. I coming to believe they don’t believe in life at all anymore.

    In defense of their poor customer service people who are obviously in India, they were at their wits end. One told me that had a meeting early in the day on how to try and remain calm with the people they were speaking to you weren’t calm at all. Somehow, I don’t think I’m the only one who didn’t really “read” the warning page.

    This was a one way flight from Denver to Fort Lauderdale. The ticket was $268 plus the $25 that they demanded I pay for carryon bag. I don’t consider that an economy flight. Further, it was insulting that I was demanded to pay $25 for my bags, but at the gate counter they were offering to check bags for free because, “We have too many people not checking the bags.”

    A once great airline has truly lost it’s way.

  39. Ann — Even with a regular economy ticket, you would have paid $200 plus the fare difference to change a ticket that was only worth $268 in the first place. With such an inexpensive ticket you likely would have been better off just buying a new ticket. So I’m not sure you were really worse off due to basic economy. The major carriers have not let people change heavily discounted tickets without penalties for as long as I can remember.

    Also, now you know how basic economy works and can decide whether it’s worth it to you next time. With any new policy there’s a learning curve, and it’s unfortunate that this happened to you. But now you know how it works.

  40. I just booked a basic economy ticket flying roundtrip to Honolulu from Chicago for $720/ticket and not sure if things have changed but I was certainly able to choose my own seat and apply the mileage to my mileage earning account during the booking phase. I did not use a United credit card for it either.

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