Price segmentation has become a major part of airline commercial strategy in the US. By offering multiple ticket types, airlines can attract a wider variety of customers while maximizing revenue. This isn’t widespread in premium cabins yet, but it’s now standard practice among the three legacy carriers in economy. All three offer extra legroom seating, along with a fully refundable fare option, and then the standard economy fare. Then, you have the lowest and most controversial fare option: basic economy.

Bacic economy was first introduced in 2012 by Delta Air Lines, but it’s since been introduced by United Airlines, American Airlines, Alaska Airlines, JetBlue, Hawaiian Airlines, and Southwest Airlines. In addition, many foreign airlines have introduced lower-priced fares with high restrictions, although these airlines often label these fares differently. Basic economy fares were unpopular when they were first introduced and deliver lower margins for airlines, but they do serve their purpose to both their target market and the carriers.

Overview Of Basic Economy In The US

Credit: Shutterstock

In 2012, Delta began trialing basic economy. Initially, the Atlanta-based carrier claimed that the aim was to better compete against Spirit Airlines, at the time one of the biggest threats to the legacy airline business model. In 2015, Delta was offering basic economy in 75 markets where it directly competed with Spirit Airlines. By 2017, however, Delta’s basic economy fares were offered on all its domestic routes, and the carrier has since added them to its international network.

Although some variation exists between carriers, basic economy tickets, for the most part, restrict customers from certain flight changes and may come with bag restrictions. Basic economy customers are booked on the same seats as other economy passengers, meaning that variances are solely regarding flexibility and additional services. This can also include seat selection, and basic economy tickets may have reduced or no mileage earning, discouraging frequent flyers from booking these fares.

Basic economy is not necessarily a product that airlines view as incredibly lucrative on its own. These fares exist mainly to upsell customers to higher-priced tickets with better margins. When booking with any airline, basic economy fares often come with labels that highlight their drawbacks while encouraging upsells to standard or refundable fares. Although basic economy was promoted as a necessity to compete with budget airlines, these fares are often only slightly lower or the same as full fares in the past, and airlines are now charging more for standard tickets.

Delta’s Main Basic Fares

Credit: Shutterstock

Delta was the first airline to introduce basic economy (now branded as Delta Main Basic). Delta advertises these fares as offering the same onboard experience, but with limited flexibility. These fares are promoted as being ideal for solo travelers and light packers with no seating preference. Once onboard, Main Basic customers still receive the same meal options, sit in the same seats, and receive access to in-flight entertainment as other economy travelers.

Delta offers 24 hours for all customers to cancel their flights, but after that period, it will charge a cancellation fee of $99 to $400, depending on where you’re traveling. The remaining value of the ticket is issued as an eCredit. This same policy applies to flight changes, and Main Basic customers must also pay the fare difference. In addition, Main Basic customers are not permitted to make same-day flight changes, which cost $75 for Classic tickets and are free when available for refundable tickets.

Delta does not permit Main Basic customers to select seats for free. Beginning seven days before departure, however, Main Basic customers can pay to select their seat, or otherwise wait until a seat is automatically assigned 24 hours before departure. Main Basic tickets do not earn Delta SkyMiles, nor do they qualify for Delta SkyMiles Medallion status, and customers are not permitted to be upgraded. Main Basic tickets prohibit SkyClub access, and these customers board last. However, Main Basic does include a carry-on in addition to a personal item.

Related

New Fare: What Does Delta’s ‘Comfort Basic’ Entail For Passengers?

Find out what you get with Delta’s new Comfort Basic fare.

United’s Basic Economy Fares

Credit: Shutterstock

After witnessing Delta’s success with basic economy fares, United quickly followed suit. For United, these fares are advertised as offering the same onboard experience, including the seats, meals, and inflight entertainment, but add restrictions to the travel experience. The carrier’s basic economy fares are generally considered the most restrictive among those offered by US airlines, and United was also extremely aggressive in rolling them out, now offering them on nearly all its flights.

Regardless of fare type, United issues a full refund if a ticket is canceled within 24 hours. After this period, the only way to change a basic economy ticket is to cancel your existing ticket and rebook. United charges a cancellation fee for basic economy tickets, and the remaining value is issued as a travel credit. Those flying basic economy do not earn miles unless they hold a United co-branded credit card or MileagePlus Premier status. The basic economy earn rate is reduced, but it is still more generous than Delta’s policies.

United permits basic economy customers to select their seats for a fee, and they are not eligible for complimentary upgrades. On most flights, the carrier does not allow basic economy passengers to bring carry-on bags, restricting them to a personal item only. United Airlines is the only US airline with this restriction. This does not apply, however, to those with Premier status or those who hold a MileagePlus credit card. Furthermore, basic economy passengers are the last to board.

American’s Basic Economy Fares

Credit: Shutterstock

American began rolling out basic economy fares in 2017 and offers them on nearly all of its routes. As with its peers, American’s basic economy tickets offer a standard seat in the economy cabin with full onboard service, but are the most restrictive fare type offered by the Fort Worth-based carrier. The biggest restriction is that basic economy fares do not permit any changes, although American does offer exceptions for AAdvantage members in permitting cancellations. American charges a cancellation fee, with the remaining value issued as a refund.

Customers who are not AAdvantage members can cancel for a full refund within 24 hours of booking, but otherwise cannot cancel tickets. American does not award miles or Loyalty Points for basic economy tickets, which is the same as Delta’s policies, and more restrictive than United’s policies. American also permits basic economy passengers to be listed on standby lists. In addition, as with American’s competitors, basic economy customers board last.

American permits basic economy customers to bring one carry-on bag and one personal item. The carrier also permits seat selection for a fee, and AAdvantage elite members are eligible for complimentary upgrades. In addition, AAdvantage members can select seats for free depending on status. While basic economy can be restrictive for other passengers, the experience is relatively similar to standard economy for AAdvantage members, with the primary difference being the flexibility.

Related

What Are The Benefits Of Flying In American Airlines’ New Premium Economy?

The refreshed premium economy seats are more comfortable, aesthetically pleasing, and technologically advanced than older seats.

Which Airline Wins With Basic Economy

Credit: Shutterstock

In reality, there are relatively few meaningful differences between the terms of basic economy tickets on American, Delta, and United. Although United Airlines’ basic economy tickets don’t allow a carry-on, this doesn’t apply to MileagePlus Premier members or MileagePlus credit cardholders. Delta’s basic economy fares are slightly less flexible than American’s or United’s. In addition, miles cannot be earned in basic economy when flying with Delta, whereas United does permit cardholders and MileagePlus Premier members to earn miles.

Basic economy is an area where American is slightly more generous than its competitors. While its cancellation policy is the strictest of the three for non-AAdvantage members, AAdvantage members can cancel and book new tickets using flight credit. American offers a carry-on and notably does not prohibit AAdvantage elite members traveling in basic economy from being upgraded. However, AAdvantage members still cannot earn miles on basic economy tickets.

Basic economy fares are ultimately most appealing to infrequent travelers without loyalty to a particular airline. United loses points for prohibiting carry-ons, and customers with all three airlines board last. American, however, takes slightly better care of its elite members in basic economy and even allows them to board earlier, with the lack of miles being the main drawback. Delta, in contrast, treats SkyMiles Medallion members largely the same as non-elite members in basic economy.