You are the director of operations for Jetstream Airlines, an airline based in the United States with scheduled service to over 100 destinations in the United States and to 5 other countries. Jetstream is the third largest airlines in the continent based on the number of passengers flown.
Jetstream, like other airlines, prices nonstop flights higher than flights with layovers or stops. This gives the airlines the opportunity to fill seats on more than one flight if the passenger wants the cheaper option and to make more money if the passenger wants a direct flight.
Since airfare has increased significantly since 2021, the practice of skiplagging has become more and more popular among all airlines. Skiplagging is the practice of purchasing an airline ticket for a destination that has a layover in the desired city. For example: if a customer wants to travel from Minneapolis to Dallas, but the nonstop ticket is too pricey, the customer can skiplag and purchase a cheaper ticket from Minneapolis to Orlando that has a layover in Dallas. Instead of boarding the second plane to continue the trip to Orlando in the Dallas airport, the customer simply exits the airport and is in the desired destination on a less expensive ticket. The result is a vacant seat on the nonstop flight from Dallas to Orlando that could have been sold at a premium price.
Airlines do not like skiplagging because it leaves a vacant seat on the premium nonstop flight. Also, skiplagging can delay the next flight as the gate crew knows the passenger has flown from the originating city to the layover city and is waiting for that passenger to board the flight to the destination city.
The senior vice president of Jetstream wants to put an end to skiplagging. The senior vice president wants to punish any and all passengers found to be skiplagging, no matter the reason. The senior vice president thinks a reasonable consequence of skiplagging is a one-year ban from all Jetstream flights.
The senior vice president has asked you to analyze skiplagging and the suggested consequence. The senior vice president wants you to include the following in your analysis:
- Ethical considerations
- How changes in pricing could limit skiplagging
- Risks involved in suggested consequences
- Who will be responsible for monitoring traveler behavior and reporting skiplagging
- Long-term value to those that do not skiplag vs. long-term impact on those that do skiplag
