Originally Posted by
Halon1211
correct me if I’m wrong. but even if a customer pays with their points for a flight to a vacation market the airline still profits from that…The credit card company has to pay the airline for that.
Which is the reason Airline analysts even say that with out the credit cards carriers like American would be not make a profit.
Yes but you don't put in too much capacity more than you'd like to sell the points redemptions on. If you put too much capacity then you gotta sell the tix the cash way and make less money on those tix compared to other destinations or have the seats go empty.
Ideally we have the normal paid load factor of 70-80% and use the last 20-30% of those planes being points redemptions so the marginal cost is low. Rather than just having extra capacity and sticking at 80% load factors. Let's say we do 50 flights/day to MCO then with that plan you can save 10 flights/day to go somewhere else.