Business

Many Business Travelers Skipping “Basic Economy” Airfares

Many airlines offer no-frills basic economy fares, but businesses aren’t loving them—in part because the fares make it difficult to get a refund, booking companies say.

Business travel expense reports may look better when they include bargain-basement airfares, but “basic economy” fares have enough downsides that many business travelers are skipping them, according to recent news reports.

Basic economy has been flying high with some airlines—even coming to international flights recently, compliments of American Airlines. But they often include limitations in seat selection, overhead bin access, and the ability to get a refund, and businesses haven’t exactly been lining up to take advantage of them.

According to CNBC, many companies do not include basic economy fares as an option via their business travel booking services, such as Egencia and SAP Concur. The booking platform Lola blocks the fares entirely.

“For now our conclusion is that basic economy is, by design, not business-traveler friendly,” Egencia CEO Mark Hollyhead told the network. “We know plans often change, so flexibility on business is key.”

The lack of easy refunds is one reason companies encourage or require business travelers to skip the ultra-cheap fares. If a change in flight is required, a basic economy fare leaves the company on the hook for the cost of the unused ticket. And without overhead bin access for a carry-on bag, it might make it hard for the traveler to get work done during the flight.

Three-quarters of American Express Global Business Travel clients blocked their employees from buying basic economy flights in July 2017, up from two-thirds less than a year earlier, CNBC reported.

Not every airline is buying into basic economy. Southwest Airlines seems ready to ignore the trend entirely.

“We encourage all the other airlines to have basic economy. We love competing against substandard products,” Southwest Chief Revenue Officer Andrew Watterson recently told Skift.

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Ernie Smith

By Ernie Smith

Ernie Smith is the social media journalist for Associations Now, a former newspaper guy, and a man who is dangerous when armed with a good pun. MORE

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