Airlines have scrambled to secure capital to continue operating since the beginning of the pandemic. One unique way they did this was using their frequent flyer programmes. Key.Aero speaks with Bijan Vasigh, a professor at Embry-Riddle Aeronautical University, to find out how and why it works
To the uninitiated, airlines may look like relatively simple enterprises to run. Their basic business model could be interpreted as something along the lines of just buying aircraft, hiring pilots and crew, selling tickets and then flying people to places.
But when you dive deeper, what looks straightforward at first glance turns out the be much more complicated. Take frequent flyer programmes – the schemes that allow passengers to accrue points which are redeemed for flights or upgrades.