SuperCaravelle From Netherlands, joined Jan 2012, 219 posts, RR: 0 Reply 1, posted (1 year 1 month 4 days 23 hours ago) and read 1761 times:
It happens everywhere, sadly. Usually airlines charge a premium for direct flights as it is more convenient, and thus customers are willing to pay more. For the route LIS-GIG there is:
1. TAP Portugal offering direct flights
2. All other airlines operating between Europe and GIG.
The first has a monopoly, TAP is the only one with direct flights. Now, they are not a monopoly in the market due to the connection possibilities, but they have an advantages. The second is a basketcase of multiple airlines, meaning competition, meaning lower prices. Moreover, airlines usually use connection passengers to fill up seats, charging a premium for passengers originating in their own country / airport area. You will probably find that flights from BA from LHR to GIG are more expensive than the route LIS-LHR-GIG vv.
Viscount724 From Switzerland, joined Oct 2006, 21679 posts, RR: 23 Reply 3, posted (1 year 1 month 2 days 21 hours ago) and read 1353 times:
Quoting santos (Reply 2): Fairly common, it's actually cheaper to fly LHR-LIS-MIA-LIS-LHR than LIS-MIA-LIS with TP, it's a practice used by most airlines!
Extremely common. For example, I often fly KL from GVA to various points in Europe with a connection at AMS. The through fare is usually lower than if I was originating in AMS and only flying the 2nd leg of the trip The same is true on longhaul routes for most hub-and-spoke carriers. They have a better product (nonstop service) to/from their hub and passengers are willing to pay more for a nonstop than a connection. From GVA and other spokes they're also competing with many other carriers via their own hubs, while from AMS itself they may only have one nonstop competitor, and sometimes none.
By selling low fares via their hubs they're generating revenue for seats that would otherwise be empty. Their revenue management systems are smart enough to ensure they don't sell those low fares on flights when demand is high for the local nonstop O&D markets. For example, I flew KL GVA-AMS-MUC and back last month, which certainly isn't the most direct route (almost 3 times further than nonstop...837 miles vs. 304 miles on a 1-hour LH nonstop). But KL's fare was much lower when I booked. The entire trip took about 5 hours with a 2 hour connection at AMS but when I'm spending my own money and time isn't important I would rather save the money.
TW From Germany, joined Jul 2011, 57 posts, RR: 0 Reply 5, posted (1 year 3 weeks 6 days 8 hours ago) and read 1186 times:
You have to understand that the price that an airlines charges depends mostly on the customers' willingness to pay rather than on the cost of the seat to the airline.
Airlines use a complex yield maximization program which try to get each customer to pay as much as possible. Except for aviation enthousiasts, most people would rather fly LIS-GIG than LIS-LHR-GIG which would takes 5h more in total, and increase the risk of delay due to connecting flights and the risk of losing luggage. Therefore, even though the cost that the airline bears is lower when operating LIS-GIG rather than LIS-LHR-GIG, the price is higher because people are willing to pay more for it.