The airlines’ dirty secret: selling seats is NOT their most lucrative business
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You would think that an airline would be in the business of selling seats. Isn’t their whole purpose to transport people from point A to point B? As an industry whose primary service is moving people and stuff around the planet, you would assume airlines make the lion’s share of their profit from said service.
Think again.
A recent article details how airlines actually make more money by selling frequent flier miles than they do by transporting people from point A to point B. For Delta and American, the estimated value of their loyalty programs is greater than their market cap. That’s sort of insane.
If you read the referenced article, I hope one line stood out to you: “Airlines are earning upwards of 50 percent of [income] from selling miles to a…
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