Why Airlines Sometimes Knowingly Load Schedules They Can’t Fly

There have been reports of some airlines trimming summer schedules just months before a busy summer season is expected to start. One might think this is a sign of a weakening economy, or perhaps that airline has had problems getting the pilots, flight attendants, and airport workers needed to fly all their planned capacity reliably. Interestingly, other airlines are beefing up for the summer, sending a more bullish signal about demand and their ability to meet it. Why would some airlines be adding while other are pulling back for the season?

The answer is that the signals sent by these actions may not be accurate. It could be more simple – the airline loaded more capacity than they ever planned to operate, and trimmed before the season based on better data of where the demand really exists. Not every airline does this, but some do and it can mean they run a more realistic summer as a result. Not everyone supports this, though, as it offers seats for sale that the airlines know may not exist. There are multiple reasons for this behavior:

Booking Curve

The rate at which bookings are made for a flight sometime in the future is called the flight’s booking curve. It’s March 2023, and some people have already confirmed their Thanksgiving week flight plans, but not many. Booking a flight far in advance has some risks. Your situation may change making it so that you cannot take the trip, and airline refund rules may not be in your favor. It’s also possible that the airline will offer a lower fare sometime before the flight, and you may or may not see this or be able to take advantage of it. People know that airlines change their schedule occasionally, so a far in advance booking increases the chance that your flight time will change.

For domestic U.S. flights, most of the bookings happen in a 90-day period before the flight, with the bulk of these bookings in the final six weeks before the flight. The more people who book, the firmer the flight is for the airline to achieve their revenue targets. Also, though, it disrupts more people and creates more challenges if a well-booked fight is cancelled or significantly changed.

Selling Almost A Year Out

Most airlines sell flights almost one full year out. Usually about 330 days is the norm, and when an airline loads a schedule it puts its capacity publicly for sale through this period. Obviously, they are much more certain about flights departing in the next 30 days than flights 320 days out. Airlines could build their schedule based on a fleet plan that isn’t accurate, if the planes can’t be delivered on time. There also isn’t an obvious advantage to buying so far out, even though the airlines offer the seats. Most airlines know they can always sell the seat for a low price, so there is no reason to offer a low price so far in the future. This risks what airlines call displacement, or selling a seat cheaply and then learning later it could have been sold for more.

It is this variation between when people mostly book and how many seats are out for sale that has encouraged some airlines to load more of a hypothetical schedule for far out, to learn what current demand may look like before making an operational commitment. The cost to cancel a flight four months or earlier before departure is low, because usually only a few customers are impacted by the change.

Demand Fluctuates, And Post-Pandemic Demand Is Still Volatile

In a normal year, economic cycles, the cost of fuel, and overall inflation all affect airline earnings and demand. Airlines started selling summer 2023 in Spring 2022, before even knowing for sure what summer 2022 would be like. This volatility is normal in the most stable times, but the effects of the pandemic are still driving some airline demand behaviors. American Airlines recently said that about 20% of 2019 business traffic would never return.

Airlines had a strong summer 2022, and that demand strength surprisingly continued into the Fall of 2022. The composition of demand has shifted since before the pandemic, however. There is less structured and contracted business, but more leisure customers in total and more who are willing to pay a bit more for a nicer experience. Capacity for summer 2023 has been booking, slowly, since late last year but even a small amount of data are valuable in a volatile environment. It has been the last month or so that is the “sweet spot” to make changes to the summer. This means trimming flights that, through sales data, suggest may not be full in the summer and adding capacity to flights with stronger demand profiles. This is a better predictor as to why airlines have recently announced both cuts and adds to this summer’s capacity plan.

What Consumers Can Do

Most consumers should not change their behavior because of this. Buying far in advance locks up cash that can be used for other things. The likelihood that an airline would choose to cancel a flight for non-weather or near-term operational issue in the 90 days before departure is almost zero. These kind of changes tend to happen on the day on or one day before departure, and have nothing to do with the advanced date schedule load process.

Consumers often get a better fare when buying within that 90-day window. This is because even small airlines have thousands of flights to track. Revenue Management systems have no emotion. They look at actual sales data as they come in, and compare this to their forecast and show whether actuals are ahead, behind, or on plan. With very little booking activity far out, these systems rarely get off track and so no human is looking at the flights that far out. As the flight gets closer to departure and the booking activity accelerates, the likelihood that the actual sales vary significantly from the forecast increases. This is when the emotional humans get involved and decide a sale is needed to firm up the bookings.

Should Anyone Be Bothered By This Practice?

No one should be bothered by this process. Very few people are affected by it, and the airline ends up with a more efficient travel plan during a busy season. In some ways this a cousin to the flight overbooking process airlines use. While overbooking has a bad name to many, in fact it helps many more people get low fares and very few people are denied a seat that they bought. In the same way, loading speculative advance schedules allows airlines to better match their capacity plan to real-time demand. This is often hard to predict accurately, and this process helps the airlines get data to help. Not every airline does this, but those that do have a process that is well defined and adjusted long before most people show up to book the flight.