Air France's announcement this week that it is charging European economy class passengers an optional fee to hold ticket reservations for up to 14 days reflects a trend by European airlines during the past 18 months toward immediate ticketing of flight reservations and also opens a new frontier in fare unbundling.
"What it does is reintroduce the notion that travelers can have more time to decide whether they want a ticket, but now it comes at a price," said Tony Berry, industry and airfare distribution director for HRG. "Essentially, Air France is unbundling the time limit from the fare."
Although Air France publicized its Time to Think option for the first time on Monday, the airline quietly introduced it on March 28. That was when it restructured its economy class offering, including eliminating fully flexible tickets. Since that date, Air France passengers have been able to pay a nonrefundable €10 fee—£10 for U.K. passengers—for Time to Think on short- and medium-haul flights, allowing them to hold a reservation at the same fare for up to 14 days. If they do not confirm within that period that they want the ticket, the reservation is deleted.
On June 1, Air France extended Time to Think to long-haul services for a fee of €15, £15 for U.K. passengers.
"When travelers hold on to unticketed seats for long periods, it interferes with airlines' yield management processes," said Berry. "As a result, airlines have been reducing ticketing time limits to force a ticket issue or re-pricing at a potentially higher fare. Time limits have always ranged but they used to be as much as 21 days. Now, on average, they are around three days. This is the first time I have seen an airline charge for holding a ticket, so yes, it is significant. I see no reason why this may not become more widespread. Flexibility will come at a price."
With the gradual death of fully flexible fares, there is also growing legislative pressure to allow travelers more breathing space. Last week, the U.S. Department of Transportation
issued a rule proposal that would require carriers to allow "reservations to be held at the quoted fare without payment, or cancelled without penalty, for at least 24 hours after the reservation is made."