Many airlines and not only, but companies arount the world, make big mistakes. Some mistakes turn out to be more expensive than others. The errors of the companies are from all fields of activity, from the leading companies to the it or aviation domain.
In the case of an American airline too, called American Airlines, the mistake is a huge expense, which have been paying for over 30 years. What happened?
In 1981, American Airlines at that time US President Robert Crandall wanted to reduce fuel consumption costs dramatically in order to maintain the fleet by rebuilding the airline from the ground.
At that time the rates and interest were very high, so the airline came up with an alternative solution to try to quickly collect the necessary money, thus selling first-class flight tickets for unlimited flights, at the price of 250 thousand dollars each.
Unfortunately, due to inflation, the cost of a ticket since then rises to 570 thousand dollars in 2019. Even though the sale was discontinued in 1994, however, 28 customers managed to buy such tickets.
The problem that the company was about to discover for a while was that, although customers may not abuse the unlimited options of the “unlimited” first class ticket, such as a dinner at a luxury restaurant or a vacation. inclusive, it was that the passengers wanted to “consume” the miles they had available, literally and metaphorically.
Being unlimited, the term could be confused, getting some passengers to make 10 thousand flights, so the company had to rethink the term used in “Unlimited for life”.
Steven Rothstein was one of the customers who bought such a ticket, a former investment banker in Chicago. He said he flew four times a week, so the airline even offered to buy him the ticket at a very advantageous price.
Jacques Vroom was another customer who said he was flying 2 million miles a year – he just liked to fly to London or Paris to have lunch with a friend.
However, in 2007 the US-based revenue integrity team targeted the loss-making operations of the airline and, surprisingly, AAirpass was unprofitable for decades.
Rothstein said he often gave tens, hundreds of kilometers to others who needed to fly, such as attending a funeral of a close relative.
Rothstein now says he will no longer fly American after revoking his unlimited AAirpass and that his favorite airpline is now United.