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Author Topic: Oversupply - Limiting Seats  (Read 545 times)

Offline Vin

  • Members
  • Posts: 296
Oversupply - Limiting Seats
« on: January 17, 2018, 04:35:49 AM »
Hey Fellow AWS

Was wondering if we can get by the Oversupply warning by limiting seats ?

Also by limiting seats would it have a positive effect on the Loads and Yields.

e.g. I am operating from PTY - AMS - B772ER

Demand is about 170 and my capacity is 280

Thanks guys

V

Offline Tha_Ape

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  • Posts: 5596
Re: Oversupply - Limiting Seats
« Reply #1 on: January 17, 2018, 07:46:48 AM »
Sure. And got to to this.

After one or two months, if you don't block seats, the route will be deactivated (not completely cancelled, but you won't have the slots anymore and it won't fly).
Loads will obviously be better, but the yield c/rpk will stay the same as you will most likely have the same number of pax than before.

However, oversupplying a route is usually something to avoid, especially on LH: this is where one more seat brings much more, but one less seat costs a lot. So if you do it you got to have good reason (hole in a schedule, building RI before an airport will be transferred to a new one, etc.).

In my current GW I do it a lot, but because I precisely know the operating and intangible costs of my planes, thus I know where to stop. Also, I fly some loss-making routes, but only to prevent my competitors to make money on them as they are already in a difficult situation and this makes it worse.

So once again, better do it once you master the costs.

 

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