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Airline passengers often end up at odds over many aspects of the in-flight experience — a reclining seat in the knees, groups of travelers asking others to switch rows, and overhead cabin battles, among them. On many international flights, there’s a new way to compete civilly with other passengers: an auction for seat upgrades. They enter their bid and credit card information if they wish to participate. If they have the winning bid, their card is charged and their seat is upgraded, often at a steep discount when compared to what the upgraded seat would have cost at the original time of purchase.
While the concept has caught on around the globe, the U.S. airlines are for the most part an exception. Spirit Airlines’ SeatBid Program offers upgrades for its Big Front Seat, which is exactly what it sounds: a larger seat at the front of an aircraft. Other major U.S. airlines do not offer auctions for upgrade seats. Zack Griff is a senior aviation writer at travel website The Points Guy. He says that major U.S. airlines are likely to weigh the benefits and costs of this practice since it’s already built into their business model. “Most major U.S. carriers offer several ways to upgrade your flight, whether you want extra legroom, premium economy, or business-class seating. Griff says that in recent years, the concept of blind auctions for distressed inventory (seats that would otherwise remain unsold) has gained in popularity. “
Companies such as PlusGrade, which describes itself as being in the “ancillary revenue solutions” niche, have sold the technology to many carriers to make this offering available on many flights operated by international carriers.
Picture yourself a week before your flight: you receive an email inviting you to place a bid online to participate in an auction for seat upgrades. You don’t have to call an airline and there are no upfront costs. You set your own price and a meter tells you how likely it is that the bid will be accepted. You may or may not get the seat. But you are still in the running and haven’t paid anything upfront. The airline will have a winner, but those who do not win aren’t worse off.
But not everyone wins, especially with the way U.S. Airlines reward their passengers today. Think of the loyal flier, who diligently collected and protected his or her points and elite status in part to receive free upgrades. This person might be holding their card in silence, running their thumb along the edge. They may feel underappreciated. Airlines do not want to alienate the person.
The larger U.S. airlines, such as
United, haven’t yet offered these types of auctions on a widespread basis, likely because they are keeping their premium-cabin inventory for upgrades via miles, frequent flyer perks, or last-minute buy-ups, Griff said. These airlines promote upgrades as an important perk in their frequent flyer program. American declined to comment; the rest of the U.S. carriers did not respond to requests for comment. American declined to comment; the rest of the U.S. carriers did not respond to requests for comment.The upgrade model in the U.S. could change, but that’s not likely to happen quickly.Airlines are not known for being especially tech savvy — AirPod integration, for example, might be a major breakthrough — but unloading higher-cost seats is going to be increasingly important, according to Griff, who says the traditional way of dealing in upgrades may not be optimal from a bottom-line perspective.While in the short-term the flights mostly likely to be associated with upgrade demand — longer, international flights — are those highest in demand with American travelers, there is another side to the new reality that will last potentially longer: a sharp decline in business travel that is likely to level off but unlikely to return to pre-Covid levels.
Scott Keyes of Going (formerly Scott’s Cheap Flights), an online platform that connects travelers with affordable airfare options, sees both the challenges and potential in such programs. The industry is embracing the trend of auctioning off unsold premium seating. Upgrade auctions are increasingly being used by airlines to sell seats in premium economy, first and business class that would otherwise go unsold. Keyes’ rationale for the airlines is that upgrade auctions bring in significantly more revenue than giving out free upgrades. Keyes explained that the travelers who are able to win these seats benefit as well, as they receive discounts of up to 70% on front-of-the plane seats. This also means that a person who didn’t enter the competition is a loser. Keyes stated that “travelers with elite status could have counted on being upgraded to these otherwise empty seats a decade earlier.” In his phrase “a decade ago,” Keyes may have hinted at a possible evolution in the upgrade process. Keyes stated that “now those seats are being sold, instead of given away free.” Many travelers pursue elite status in the hope of receiving free upgrades for life. “
If more airlines adopt auction practices, this perk of elite status may fade, though it would undoubtedly be replaced by other perks: for instance, posh private airport lounges.
Given the reality of upgrades within the airline industry, and the changing landscape of business travel, it would not be surprising to see an increase in upgrade auctions on the part of domestic carriers in the future, likely met by some new ways to maintain customer loyalty from frequent fliers.