Basic Economy Fares: The Block on Cheap Flights

Large companies and corporations are always conscious of expenditures. Saving money on travel is often a priority, but allowing employees to select cost-effective flights when flying for business travel is one place they may rather pay more.

Budget flights with those "too good to be true" prices seem to be popping up everywhere. The major US airlines, like United, Delta and American, used to be the leaders in the industry, but as a result of deregulation, budget airlines and startups have been making a charge low-balling the product. In order for those airlines to keep costs so low, their travelers have to understand and accept the very basic features those budget carriers offer, and willing to make certain sacrifices in order to fly on the cheap. The upside for some is that it makes air transportation more affordable for a growing number of folks. For business travelers, however, the risk of these budget flights is often not worth the perceived discount.

To cut costs and be competitive, the major airlines have created budget fare options. With those basic economy fares you are often unable to select a seat, and are readily assigned to the rear of the aircraft, which means you will be in the last group to board and will probably not get any space for your carry on in the overhead compartment. Also, this basic ticketed fare will not allow you to be eligible for upgrades and won’t offer a refund if you miss your flight or need to cancel.

Most travel managers now block out these budget airlines and/or “basic economy” fares for their travelers, in order to avoid the many restrictions that come with that low ticket price. ARC’s managing director of data science and research,Chuck Thackston,found that “63% of travel managers for large corporations have policies that never allow their employees to book basic economy fares, and 79% of the travel booking programs that the managers use hide the basic economy seat option."

Corporations have found it is simply not worth it to have their employees travel on these budget airlines or the basic economy option. The strict policies can lead to an uncomfortable flying situation that can than deter employees from wanting to travel for business in the future. So rather than having to deal with the many issues that can arise from these budget flights and can end up costing the company more money, they have decided to just block the option instead.