After calculating the probabilities and EMSR for each fare class, the airline must decide how many seats to protect and limit for each fare class in this flight. It makes sense for the airline to protect seats for a higher fare class as long as the EMSR for the additional seat is greater than the revenue received for that seat from a lower fare class.
For example, the EMSR for the 19th seat is $672.27 for the Y fare and $659.44 for the M fare; however, the 20th seat sold would yield an EMSR of only $541.56 for the Y fare and $659.44 for the M fare. Because the yield for the 20th seat in the Y class is less than the yield for the 20th seat of the M class, the airline would protect 19 seats for the Y fare, or the seats above the 20th seat, where the discrepancy occurs.
For example, the EMSR for the 19th seat is $672.27 for the Y fare and $659.44 for the M fare; however, the 20th seat sold would yield an EMSR of only $541.56 for the Y fare and $659.44 for the M fare. Because the yield for the 20th seat in the Y class is less than the yield for the 20th seat of the M class, the airline would protect 19 seats for the Y fare, or the seats above the 20th seat, where the discrepancy occurs.
The airline would then proceed to protect seats in the M fare class until the EMSR level of the nth seat for the B class exceeds that of the M class. In other words, continue to look for a similar discrepancy between the M and B fare classes. In like manner, the airline will protect the seats beginning with the seat above the discrepancy.
Booking limits for each class are determined by subtracting the number of protected seats of each higher fare class from the available seat capacity. In this case, the booking limit for the Y fare class would be 70 because that is the total number of available seats and is there is no higher fare class; therefore, the booking limit is equal to the available seat capacity.
In the example of the Y fare class, there are 19 protected seats, which number we learn from finding the discrepancy in fares from our chart in table 3. Joint protected seats refers to joining two classes of protected seats. The Y class shows only 19 joint protected seats because there is not a higher class with which to add together with the protected seats from Y.
So, what are the protected seats in the M fare class? How do we determine the number?
Refer again to our chart in table 3 and locate the fare discrepancy between the M and B fare classes, where the B class fare is more expensive than the M class fare, then simply refer to the seat number above it as the marker for protected seats for the M class. Input the seat number in the space provided for Protected Seats for the M fare class.
To find the joint protected seats for the M fare class, what must we add to our number of protected seats for the M fare class? Remember in the example of the Y class that the joint protected seats remain 19 because there is no higher class to combine with it. In the case of the M class, do we have a higher fare class with which we can combine? (Yes).
Add the number of protected seats from the M class with the number of protected seats from the higher fare Y class to get your total.
What would be the booking limit?
As there are 70 available seats on the aircraft, and Y is the highest fare class there is no higher fare class to subtract to get a total of 70 seat booking limit, correct?
Let's try the same with M class. If there is a 70 available seat booking limit for the aircraft and we have 19 protected seats from Y class, what is left over for the booking limit for the M class? (70-19)
What about B fare class? How many protected seats would be awarded to B fare class?
As there are only 3 fare classes and the Y and M fare class protected seats have already been established, does it stand to reason then that B would get what else is left over?
What about B class joint protected seats?
Again, as there are only 3 fare classes and B is the lowest fare we have no need to protect it from a seat fare that is lower as B is the lowest there is! In this case, would joint protected seats need to be calculated at all? (No)
What do you think the booking limit would be for the B class? We've already established 70 seats for Y and 51 for M. Do we need to calculate a booking limit at all given that all the B seats are what is left over after calculating Y and M? (No). B class booking limit is then the same as the protected seats = everything that is left over after Y and M calculations.
In the example of the Y fare class, there are 19 protected seats, which number we learn from finding the discrepancy in fares from our chart in table 3. Joint protected seats refers to joining two classes of protected seats. The Y class shows only 19 joint protected seats because there is not a higher class with which to add together with the protected seats from Y.
So, what are the protected seats in the M fare class? How do we determine the number?
Refer again to our chart in table 3 and locate the fare discrepancy between the M and B fare classes, where the B class fare is more expensive than the M class fare, then simply refer to the seat number above it as the marker for protected seats for the M class. Input the seat number in the space provided for Protected Seats for the M fare class.
To find the joint protected seats for the M fare class, what must we add to our number of protected seats for the M fare class? Remember in the example of the Y class that the joint protected seats remain 19 because there is no higher class to combine with it. In the case of the M class, do we have a higher fare class with which we can combine? (Yes).
Add the number of protected seats from the M class with the number of protected seats from the higher fare Y class to get your total.
What would be the booking limit?
As there are 70 available seats on the aircraft, and Y is the highest fare class there is no higher fare class to subtract to get a total of 70 seat booking limit, correct?
Let's try the same with M class. If there is a 70 available seat booking limit for the aircraft and we have 19 protected seats from Y class, what is left over for the booking limit for the M class? (70-19)
What about B fare class? How many protected seats would be awarded to B fare class?
As there are only 3 fare classes and the Y and M fare class protected seats have already been established, does it stand to reason then that B would get what else is left over?
What about B class joint protected seats?
Again, as there are only 3 fare classes and B is the lowest fare we have no need to protect it from a seat fare that is lower as B is the lowest there is! In this case, would joint protected seats need to be calculated at all? (No)
What do you think the booking limit would be for the B class? We've already established 70 seats for Y and 51 for M. Do we need to calculate a booking limit at all given that all the B seats are what is left over after calculating Y and M? (No). B class booking limit is then the same as the protected seats = everything that is left over after Y and M calculations.
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