Air Canada plans to introduce an online auction program to sell upgrades to some of its premium services.
The Montreal based airline is just the latest in a growing number of international carriers which use an auction platform to gain incremental revenue from spare premium capacity.
The program, which the Company plans to have up and running by the summer of 2017, will offer eligible passengers the right to place bids on upgrades on selected destinations and flights operated by Air Canada, Air Canada Rouge and Air Canada Express.
Flights and ticket classes will be selected by Air Canada and passengers, who qualify to participate in the auction, will be notified by email 10 days prior to departure. Once notified the passenger may place a bid on an upgrade anytime up to 96 hours before departure. Passengers that place successful bids will be notified 48 hours prior to departure.
Mark Nasr, Air Canada’s Managing Director of E-Commerce, Loyalty Programs and Ancillary Revenue told the Globe and Mail newspaper:
“It’s really designed to appeal more to leisure customers who might not have a willingness or an ability to pay the published business-class fare up front, but might be willing to bid a reasonable extra amount of money for a discounted offer.”
Successful bids are not transferable or refundable and Air Canada reserves the right to determine which flights and ticket classes will be eligible for the program.
The program will be run a by Plusgrade, a Montreal based firm specialising in merchandising and ancillary revenue. Plusgrade operates similar auction services for several international airlines including Lufthansa, Air New Zealand and Singapore Airlines.
This auction type system, currently used by approximately 40 carriers worldwide, appears to offer airlines an opportunity to raise additional revenue from underutilised cabins and classes of service. The effects it may have on these carrier’s elite passengers accustomed to complimentary upgrades, is still to be determined.