LESSON 6: FARE CLASS AND FARE BASIS CODES

What is the Difference Between Fares, Rates and Tariffs?

As a definition, a fare is usually referenced to in air travel while rates are used with hotels. According to ATPCO (Airline Tariff
Publishing Company), a fare is not only the amount a passenger pays, it also contains the conditions for travel at this amount – that
are the rules and/or restrictions that must be satisfied in order to qualify for a specific fare.

Together, fares and rules form an infrastructure used for auto-pricing (identifying a fare electronically). A fare has 13 components,
including tariff, carrier, rule, market and amount.

FARE CLASS
Also called fare basis, it contains three parts: fare class code, explanation text and booking code. Based on industry standards, the
fare class code is an 8-character code that signals fare parameters in an abbreviated form. The fare class also serves as a bridge
between the fare and the rule provisions, thus enabling a fare to price automatically. It is usually assigned by the carrier. It usually
indicates class of service and may also indicate basic ticketing requirements a passenger must meet to qualify for a given fare, such as
day, season, reservation/payment requirements and fare type.

FARE FAMILY
A method of identifying multiple fare classes within a single entry. Lately used to sell bundles of several ancillary services, generic
services, fare conditions and booking class (which usually trigger mileage accrual).

FARE RULE
A rule that states the conditions of travel for specific fare classes. As used in this document, the term can refer to rules governing
published fares (grouped by categories) or to fares that are contained in the text of a rule (fare-by-rule). The term is used to
differentiate between this type of rule and a governing rule. A rule has three components: fare class code, booking code and
category restrictions.

Tariff at ATPCO refers to a database that contains data defined by system, geographic scope and distribution process. Also, tariff is the
term used for information filed with governments when a legal filing is required. It may also refer to written fare and rule information
including the following: Published (public) tariff, which contains fare and rule data that is available for public inquiry, whereas a
private tariff contains fare and rule data that is not (private tariffs have a limited distribution). Paper tariffs are officially filed on paper
with a government.

TRADITIONAL FLIGHT DISTRIBUTION

If the traveler doesn’t use the website of the airline (and hence use the e-commerce engine of the airline) but consults a travel agent
who uses a GDS, then the GDS consults a 3rd party data base for schedules of flights (e.g. OAG) and another 3rd party data base for
the fares for such schedules (e.g. ATPCO) and combines such data to provide an offer, subject to availability which the GDSs become
from the airline.
AIRFARE
The airfare is the price that you pay to travel on an airplane. The fare may be one-way or round-trip. The price consists of a base fare
plus the regular taxes and fees.

Airlines determine fare pricing based on a number of factors, such as the number of seats in each fare category, reservation time
periods, competitor pricing on similar flights, and the type of consumers using a particular flight. Computer-assisted revenue
management systems are used to examine historical demand to establish the number of seats made available for sale at various
fares. Analysts then monitor each flight to adjust seat allocations and fares accordingly.

There are two main types of fares:

1. PUBLISHED AIRFARES - Anyone can buy a published airfare. You can buy them from anywhere – airlines, travel agencies, or online
booking sites.

TYPES OF PUBLISHED AIRFARES

Below are a few different types of published airfares. They all have their own special rules, restrictions, and availabilities. Airlines will
fill airplane seats with a variety of these fare types.

NORMAL FARE - Normal fares (also called standard or basic fares) are the backbone of the fare structure in that they apply to all
passengers at all times (without restriction) and are the basis for all other fares.

PROMOTIONAL FARES - are discounted fares that supplement the normal fare structure; they are always offered with some kind of
restriction, such as minimum length of stay, day of the week, or season. Summarize several promotional fare actions initiated by air
carriers.

APEX FARE - These fares are discounted international fares. Apex fares are usually purchased in advance – this is called advance
purchase. For example, you need to buy the ticket at least 7, 14, or 21 days before departure. They will have some other restrictions
attached, such as being non-refundable and fees for any changes.

DISCOUNT FARE - These fares are cheaper as they are usually available for a limited time, like a ‘seat sale’. Discount fares can have a
long list of limitations like the:
– Travel dates – e.g. July – August only
– Minimum stay – e.g. 2 nights
– Maximum stay – e.g. 3 months
– No refunds

Unrestricted, flexible, full fare, or walk-up fare - These are the most expensive types of airfares. This is because you can refund or
change these tickets as necessary. They can also be purchased on the same day you travel. The pricing for these fares is used as the
benchmark for the discounted fares. So, this is basically the regular price of the fare.

JOINT FARE - Joint fares are a result of more than one airline working together as partners to get you to your destination.

THROUGH FARE - Through fares can be combined with the above fare types and happen when you fly through a gateway city.
Although you will be flying via a third city, you are only charged one fare from your departure to your destination.

BEREAVEMENT FARE - Bereavement fares are last-minute fares that are available right up until the time of departure. Airlines offer
them to family members for funerals, or in the case of imminent death. Although bereavement fares are usually discounted full fares,
they may not always be the cheapest ticket. The discount is usually 50% of the full fare. You can only buy bereavement fares from the
airline directly, over the phone or at the ticket counter. Apparently, in recent years many airlines have been cutting their
bereavement fare options.

OPEN-JAW - An open jaw ticket is a return ticket; however, the departure and the destination are not the same each way. For
example, you fly from New York to Rome, have a little road-trip around Europe, and fly back from Paris to New York. NY to Rome,
Paris to NY.

There are three different types of open jaw flights:

1. Destination open-jaw – NY -> Rome, Paris -> NY
 2. Origin open-jaw – NY -> Rome, Rome -> Boston
3. Double open-jaw – NY -> Rome, London -> Boston

Going to a different airport in the same city is not considered to be an open-jaw flight.

MULTI-CITY - Multi-city flights are single tickets that have multiple stops. Like a Round the World ticket, but you don’t have to go that
far! You can turn layovers into stopovers (layovers are under 12 hours and stopovers are over 12 hours). Traveling this way allows you
to visit many destinations and save on overall flight costs.

Booking open-jaw and multi-city flights online can be very expensive. The best way to book these types of flights is to use a travel
agent. They are experts at piecing together these types of flights.

TYPES OF AIRFARES - MULTI-CITY FLIGHTS

YOUTH/CHILD/SENIOR FARES - When you book your flights with a travel agent, there may be the option to get reduced rates for
youth, child, or senior travelers. This depends on the airline and the airfare. However, these discounts may only apply to full-fare
tickets, or only be 10%, so our discounted fares may already be the cheaper option. Infants are usually classified as up to 24 months
old (2 years). Children are from 2-11 years old.

UNPUBLISHED FLIGHT DEALS

These airfares are not available online through flight booking websites and neither on the airline’s own website. You also cannot call
the airline to book these flight deals. Travel agents find these airfares through a Global Distribution System (GDS). To get an
unpublished airfare, you will need to contact a travel agent. There are varying discounts available on these fares, depending on your
route, airline, dates, etc. Also, the fare rules for these airfares may vary wildly, including some of the restrictions mentioned
previously. Unpublished airfares are also known as private airfares, wholesale airfares, consolidator airfares. Fare consolidators are
also known as bucket shops in the UK.

In general, there are four different classes of seats on an airplane, and they include the following:

 ECONOMY SEATS, commonly called travel or coach class, offer basic accommodations when you fly and are usually
purchased by leisure travelers traveling for business or pleasure.

 PREMIUM ECONOMY SEATS, which are a slight improvement over standard economy seats and usually provide more
distance between the rows of seats and occasionally may include seats that are a little bit wider and, therefore, more
comfortable.

 BUSINESS CLASS, also called executive class seats, which are usually purchased by those traveling for business and which are
usually a higher quality of seats.

 FIRST CLASS SEATS, which offer the most comfortable accommodations available and are generally more expensive than all
other types of seats.

FARE CLASS BASICS

In the simplest definition, the various fare classes divide every seat on a plane into different categories, each with its own price and
set of rules. Fare classes are identified by one letter fare codes. Some fare classes and codes are standard across all airlines, while
some are very different depending on the airline. Here are a few fare codes that are typically the same across all airlines:

 Y: Full-fare economy-class ticket

 J: Full-fare business-class ticket
 F: Full-fare first-class ticket

Fare classes are used by airline reservation systems and travel agents to sell seats on a plane, keeping track of which fare classes are
still available. Let’s take a look at a quick example. Here’s a screenshot from ExpertFlyer with American Airlines flight 38 from Miami
(MIA) to London-Heathrow (LHR) on Feb. 14, 2020:
As you can see, the fare classes with a number next to them are still available; the ones with a zero are not. The number after the
letter delineates how many tickets are left in each fare — Expert Flyer maxes out at seven, so there are at least seven seats left in
most fare buckets but zero seats left in fare class A, Z ,C, U, P, X and O.

Here’s how these fare classes fall into the four classes of services offered on the Boeing 777-300ER American is using on this route:

 F and A: first class

 J, R, D and I: business class
 W and P: premium economy
 Y, H, K, M, L, G, V, S, N, Q and O: economy
 B: basic economy

While these fare classes represent all the tickets you can buy directly with cold hard cash (i.e. revenue fares), for example, A (which is
zeroed out on this flight) doubles as the fare code for discounted first class ticket and for upgrades from business to first class on a
three-cabin aircraft. Meanwhile upgrades from economy to business fall under the C fare class, and MilesAAver award tickets (the
cheapest price tier on AA’s award chart) use the T, U and Z fare codes respectively for economy, business and first.

Keep in mind that the most discounted fares also have the strictest rules when it comes to refunds, changes, baggage allowances and
earning frequent flyer miles or elite credit. Some airlines don’t award frequent flyer miles at all if you buy a ticket in the most
discounted economy fare class, especially when trying to credit the flight to loyalty programs of partner airlines.

FARE BASIS CODES

Codes are comprised of a number of elements. All codes include at least one letter. This is known as the ‘Prime Code’ and indicates
the class of travel the passenger has booked. The codes to be entered give information such as:

• Type of fare
• Category of passenger
• Class entitlement
• Minimum and maximum stay validity
• Reservations entitlement
• Seasonality
• Days of travel

A fare basis code (often just referred to as a fare basis) is an alphabetic or alphanumeric code used by airlines to identify a fare type
and allow airline staff and travel agents to find the rules applicable to that fare. Although airlines now set their own fare basis codes,
there are some patterns that have evolved over the years and may still be in use.

Fare basis codes can also tell an agent whether a fare is refundable, good for one-way or round-trip tickets, departing to or from
specific countries, combinable with other fares, good in high or low season, how far in advance it can be booked and whether there
are any routing restrictions or change penalties.
Example: Fare basis code WH7LNR tells the following:
W: Premium economy fare class ticket.
H: It’s a high-season ticket.
7: need to book 7 days in advance.
L: It’s a long-haul flight.
NR: The ticket is non-refundable.

Fare codes start with a letter called a booking class (indicating travel class among other things) which almost always matches the
letter code that the reservation is booked in. Other letters or numbers may follow. Typically, a fare basis will be 3 to 7 characters long,
but can be up to 8. Booking class matches the seat in an airplane with price and privileges. It is always indicated by one letter code
from A to Z.

Airlines treat airplane seats as products for sale and to make it easier to follow sales and availability, they group it in booking classes.
This approach means that each seat which was not sold becomes the “inventory” on the stock what is waste for an airline. Therefore,
some ticket prices fall in particular booking class, some seats become award from loyalty programs and so on. In other words, airlines
are using booking class to find the balance between full occupancy of a plane and maximized profit from each flight. Some fare codes
are restricted in terms of:

• The number of points awarded in your loyalty program – you can use this tool to know how many points you will get with
your booking class
• Flexibility – example: free rebooking, low-cost cancellation
• Travel class upgrades – see above mentioned example
• Baggage allowances

Each airline has its own coding system so try to dig more details of your booking class code before pushing the “Buy” button on the
carrier’s website. Some booking codes are standard across all airlines.

MULTIPLE FARE BASIS

It is common for a multi-sector air ticket to have more than one fare basis, particularly if it is for carriage on more than one airline, or
different classes of travel are involved. The issuing airline may often have an interline agreement to allow other airlines on the ticket.
One disadvantage of this system is that if any change is made, the most restrictive fare rule, and/or the highest change fee, may
apply to the entire ticket, not just the portion being changed.

FARE BASIS CODES

A Fare Basis Code can provide information regarding the type of fare, type of passenger, class entitlement, minimum and maximum
stay validity, reservation entitlement, seasonality and days of travel.

EXAMPLE:
M - Prime Code
L - Seasonal Code
X - Part of the week code
N - Part of the day code
A-
P - Fare and passenger type code
W - Fare level identifier

The seasonal code indicates the seasonality and follows the prime code. Here is a list of the seasonal codes:

H - Highest level of a fare when a fare has more than 1 seasonal level
K - 2nd level of fare when a fare has more than 2 seasonal levels
J - 3rd level of fare when a fare has more than 3 seasonal levels
F - 4th level of fare when a fare has more than 4 seasonal levels
T - 5th level of fare when a fare has more than 5 seasonal levels
Q - 6th level of fare when a fare has more than 6 seasonal levels
Y - 7th level of fare when a fare has more than 7 seasonal levels
L - Lowest level of fare when a fare has more than one seasonal level
PART OF THE WEEK
The part of the week code indicates what day of the week travel is permitted.

X - Travel permitted on WEEKDAYS only. The days may vary depending on the routing.
W - Travel permitted on WEEKENDS only. The days may vary depending on the routing.

PART OF THE DAY

The part of the day code indicates what time of day travel is permitted.

N - Travel permitted at NIGHT only.

FARE AND PASSENGER TYPE CODE

The fare and passenger type code may indicate advance purchase requirements, nonrefundable fare types and many other specific
passenger type fares. Here is a list of some of the commonly used fare and passenger type codes.

CODES CLASSIFICATION
AP or AB Advance Purchase
AN Agent Non-refundable
BD Budget Discounted
BT Bulk Inclusive Tour
CD Senior Citizen
CH Child
EE Excursion
GV Group Inclusive Tour
IN Infant
IP Instant Purchase
IS Late Booking Fare
IT Inclusive Tour
OW One Way
OX One Way Excursion
PX Pex Fare
RT Round Trip
RW Round-the-world
SC Ship’s Crew
SD Student Fare
SS Super Saver Fare
SX Super Pex Fare
UU Standby Fare
VU Visit USA
ZZ Youth Fare

FARE LEVEL IDENTIFIER

The fare level identifier is used to differentiate between the fare levels when more than one fare with the same fare basis code exists
on a route. If the fare basis code ends with a letter, the fare level identifier immediately follows it e.g.

YAB1MI Highest fare level, travel permitted on Friday and Sunday.

YAB1M2 Middle fare level, travel permitted on Thursday and Saturday.
YAB1M3 Lowest fare level, travel permitted on Monday, Tuesday and Wednesday.

When the fare basis code ends with a numeric, two types of identifiers are used to indicate the differences in a fare basis code. (1)
The letter L (indicating ‘Level’) may be added after the minimum group size e.g. YGV10L1 or YGV10L2 (2) The letters D, M, or Y, may
be added after the maximum validity of a Ticket, when the validity is expressed in days, months or years. YEE75D1 Fare level 1,
stopovers not permitted. YEE75D2 Fare level 2, stopovers permitted.

PRIME CODES
The prime code identifies the class of service paid and is usually the same as the booking code. The prime code is mandatory and a
fare basis code may be compiled of just the prime code. Here is a list of some commonly used prime codes, However many airline
use different booking classes for different cabins – you must always check with the airline first to be sure you are booking the correct
cabin for travel.

F First Class
P Premium First Class
A Discounted First Class
J Business Class Premium
C Business Class
D Business Class Discounted
I Business Class Discounted
Z Business Class Discounted
W Premium Economy
S Economy
Y Economy
B, H, K, L, M, N, Q, T, V, X, O, E, R Economy Discounted

FARE DETAILS
Each published fare basis code corresponds to a fare, which applies to travelling between two cities on a certain airline, with certain
restrictions. These restrictions can include, but not limited to:

• which particular flights can / cannot be taken on this fare

• whether the fare can be used for one-way / round-trip journeys
• changeability / refundability
• restrictions on connections and stopovers
• any minimum / maximum stay requirement (applicable for round-trip fares)
• whether open jaw is allowed or not
• combinability with other fares
• advanced purchase restrictions

FARE RESTRICTIONS
With flight classes, booking and fare basis codes, restrictions help to determine airfares. Restrictions are limitations associated with
airfares. Restrictions typically apply to coach class airfares. As a general rule, the cheaper the airfare, the more restrictions that are
associated with that fare. Some of the most common types of airfare restrictions are:

RESTRICTIONS DESCRIPTION
Advance Purchase The airfare must be purchased prior to the departure date. The time will vary by airfare.
However, common advance purchase restrictions are seven (7), 14, and 21 days prior to the
departure date
Day, Time, Flight These types of restrictions dictate when the passenger must travel to be eligible for the
airfare. Some airfares may restrict travel to specific days of the week. Other airfares may state
a specific time of day that a passenger must travel. An airfare can even state a specific flight
number.
Fees Additional fees may apply, such as taxes, surcharges, and cancellation.
Minimum/Maximum Stay Some airfares require a passenger to stay at their destination for a specific amount of time.
Maximum stay will vary by airfare, and some airfares have a limit as to how long a passenger
can stay at a destination. Many types of airfares require a Saturday night stay.
Non-refundable The passenger cannot get their money back from the airline. Airfares that are nonrefundable
are usually the least expensive type of airline ticket. Most non-refundable tickets can be
exchanged for other tickets, with a penalty added to the fare.
Mileage Mileage-based fares are priced based on the distance of travel allowable between two
locations. For a trip from Paris to Rome, for example, a fare is priced based on the distance
between the two locations—in this case 824 miles. The traveler can journey from Paris
through Milan to Rome, a trip of 697 miles, which falls within the mileage allowable (824
miles) for the fare. If the traveler decides to travel through Hamburg, 1289 miles, the mileage
would exceed the allowable amount, and separate fares would be charged for the Paris to
Hamburg and Hamburg to Rome segments. The traveler could journey through Frankfurt, a
trip of 884 miles, and although the trip exceeds the 824 miles allowed, it falls within a 25
percent mileage maximum set for the fare. The traveler would be charged a mileage
 surcharge, based on the percentage over the mileage allowed. Mileage surcharges are set at
five (5) percent increments up to a maximum of 25 percent for a mileage overage allowed for
a specific fare.
Routing For route-based fares, the journey between the destinations is checked against the fixed
routings allowed by the fare, and no mileage is considered in the faring process. A traveler
can travel either from Chicago through Denver to Los Angeles, or Chicago through Denver
through Salt Lake City to Los Angeles. As long as the routing is allowed by the fare, the fare
will apply. If an airfare has routing restrictions, the passenger must travel in a specific
direction or pattern. There are three (3) different types of routing restrictions on airfares:
1. Joint - Joint routing applies to airfares using a connection city and different airlines.
Instead of charging one airfare for each flight segment, the airlines have agreed on
one airfare from the origin city all the way to the destination city.
2. Point-to-Point - Point-to-point routing applies to airfares using one or more
connection cities and possibly different airlines. Instead of charging one airfare from
the origin to the destination, the traveler is charged a separate airfare for each flight.
Point-to-point airfares can be more expensive than airfares that allow travel on a
specific routing.
3. Through - Through routing applies to connecting flights on the same airline. One
airfare is charged for all flight segments from the origin to the connecting city to the
destination. Through fares are cheaper than airfares that require separate prices for
each flight segment.

PRICE FACTORS FOR AIRLINE TICKETS:

1. When you buy matters: The most expensive fares in business and economy class are typically purchased at the last minute by
business travelers, and last-minute fares are almost always very pricy. Leisure or vacation fares are generally cheaper because they’re
usually purchased well in advance.

2. Competition: Fares to smaller cities with little airline competition are typically more expensive than fares to big cities with hub
airports catering to many different carriers.

3. Distance: Usually, the farther you fly, the more you’ll pay.

4. Demand: Airlines know when people want to fly such as the summer months and major holidays, so they raise prices during these
peak travel periods, knowing people will pay.

5. Seat supply: Airlines don’t want empty seats; empty seats don’t make any money. So, airlines have become extremely efficient in
calculating when and where we want to fly year-round, so all seats are filled.

6. Fuel: Oil prices have been down in recent years which is good news for passengers; high jet fuel prices can mean expensive
surcharges added to ticket prices.

OTHER FARE VARIABLES

There are other fare variables that affect ticket price.

Seasonality: Flight pricing is heavily affected by seasons of the year, and that’s not just summer/winter/autumn/spring. It entails
school holidays, religious holidays, events and festivals.

Advance purchase: The cheapest airfare typically requires an advance purchase of at least 14 days before departure; purchase any
later than that and you’ll usually see a significant price hike.

Minimum stay: Some airlines require a minimum stay or a Saturday night stay-over to get the best deal; this is less common than it
used to be but it is still in force on international routes.

Cheap days to fly, expensive days to fly: Often, the cheapest airline tickets are good for travel on the least popular days to fly, usually
Tuesday, Wednesday or Saturday in the U.S. and Monday to Thursday for international routes.
Cheaper times to fly: Sometimes, the best deals require you to fly during unpopular times-ofday such as at dawn, during meal times
or overnight “red-eye” flights.

Connecting flights vs. non-stops: A connecting flight can be a lot cheaper than a nonstop; not always, but often enough so it’s worth
your while to price tickets for non-stops and flights with a stop or two. The price difference could more than make up for the
inconvenience.

Watch sale expiration dates: Many airfare sales expire after three days; others may last only a day or so. If you see a deal you like,
hurry.

Blackouts dates: Airline sales typically black-out the most popular days of the year to fly, which includes sought-after dates around
Christmas, New Year’s, Thanksgiving and peak-summer dates.