gabrielz

Hey folks:

In trying to build an itinerary SFO-NRT-ICN-SFO (5/24-6/6), I encountered a new concept - the HIP (Higher Intermediate Point) rule, on a D class biz fare (DXKR, to be exact). The fare should be $3200, but with the NRT stop, it becomes $5700.

The fare rule says "Unlimited Stopovers Permitted" and a (very helpful) agent even checked to make sure that it was a mileage-based fare (so an NRT stop should be allowed). However, when pricing the record, the agent got on the line with the rate desk (b/c stopovers don't autoprice), and they said the fare increases because Tokyo is a higher intermediate point.

Even stranger, it still prices out as DXKR the whole way through (incl. the NRT-ICN segment), but at a much higher price.

Can anyone explain the HIP rule and how it works? Is this a common issue with Tokyo routings in general?

Thanks!

<G>

PS - I hung up and called back just to see - the second agent was hostile and asked me multiple times if I was a travel agent because I knew about these rules. I was kinda irritated to say the least...

SanDiego1K

I used to run into this on European itineraries. London is typically a more expensive business class fare than many other spots - Rome, to give one specific example. I could route via London; I could stop in London for 23 hours - but if I wanted to spend more than 24 hours there, my business class fare popped up more than $2000.

TerryK

Unfortunately, the agent is correct. It is funny that Tokyo and London are the main gateways to/from Asia and Europe, but they have the highest business class fares from the US.

HIP rule states that if there is a stopover in the intermediate point, the through fare cannot be lower than the fare to/from the intermediate point. In other words, if you stop over in NRT, the SFO-ICN fare you paid cannot be lower than SFO-NRT, or NRT-ICN. Since SFO-NRT has the highest fare, that's what you'll have to pay. Unlimited stopovers only means that there is no extra charge for stopovers, but they are always subject to HIP rule.

The only way to get around it is to fly SFO-ICN-SFO and buy a separate ICN-NRT-ICN ticket. It will work out cheaper.

zvezda

My understanding is that the HIP rule is illegal in Canada, so you could buy your SFO-NRT-ICN ticket in from a Canadian travel agent and you would pay the SFO-ICN rate rather than the higher SFO-NRT rate. I've never tried this myself.

sftrvlr

Fare construction rules are followed by carriers worldwide. Canada is not exempt from them. Some carriers file "exceptions" to certain fare rules. For example, United files an exception to the HIP rule for certain fares accross the Pacific. If a ticket from BKK to SFO (via NRT) is issued in the USA (SOTO) the HIP rule says that the NRT-SFO fare must be charged since it is higher than the BKK-SFO fare, and the passenger is connecting at NRT. But there is an exception for United as long as all travel is online and no other carrier is involved. As long as the passenger doesn't stop over in Tokyo, the HIP can be ignored. Now JAL doesn't publish that exception, so the UA business class fare comes in at about $2K, whereas the JL fare is about $2700 due to the Higher Intermediate Point at NRT.

UA:
BASE FARE EQUIV AMT TAXES TOTAL
1- THB80200 USD2037.00 28.80XT USD2065.80ADT
XT 13.70US 5.00YC 7.00XY 3.10XA
80200 2037.00 28.80 2065.80TTL
ADT-01 CBKK
BKK UA X/TYO UA SFO Q5.00 M2028.52CBKK NUC2033.52END ROE
39.437542 SOTO

JL:
BASE FARE EQUIV AMT TAXES TOTAL
1- THB107810 USD2738.00 35.20XT USD2773.20ADT
XT 13.70US 5.00YC 7.00XY 3.10XA
6.40YQ
107810 2738.00 35.20 2773.20TTL
ADT-01 COW
BKK JL X/TYO JL SFO M TYOSFO2733.69COW NUC2733.69END ROE
39.437542 SOTO

In the above fare calculation, the part that says TYOSFO2733.69COW shows that the TYOSFO fare was used since it was higher than the BKKSFO fare. Now if you sent a prepaid ticket for the passenger to pick up in BKK, the JAL fare drops almost 50%!

Prepaid fare calculation:
BASE FARE EQUIV AMT TAXES TOTAL
1- THB59960 USD1523.00 35.20XT USD1558.20ADT
XT 13.70US 5.00YC 7.00XY 3.10XA
6.40YQ
59960 1523.00 35.20 1558.20TTL
ADT-01 COW
BKK JL X/TYO JL SFO M1520.37COW NUC1520.37END ROE39.437542
SOTI

That's because the HIP check rule for tickets issued in the country of origin (SITI/SOTI) says that you only have to check stopover points for higher fares, and not connections.

Complicated enough for everyone?

ozstamps

Wow. GREAT post sftrvlr! ^

sftrvlr

Ok boys and girls. It's time for Monday morning international fare calculation class ...

The geeky world of tariff and fare rules ... my life!

SanDiego1K

Fantastic explanation, sftvlr. If we had a sticky for the UA board - this post should be referenced in it.

CDG 1K

Great where do I sign up?
Nice explanation of the HIP check rule btw.

zrs70

I have found that Travelocity often ignores the HIP rule. Often when booking fares that allow stopovers, Travelocity allows an LHR stopover at the lower fare while UAL.com calculates the higher one.

sftrvlr

I imagine that's more a Sabre problem since Travelocity is powered by Sabre. Overall, the computer systems price correctly unless it's extremely complicated. And even then you can usually manipulate it to do what you want. But it's not always right, and that can be a considerable advantage to the customer since Sabre (and the others) guarantee the fares that auto-price in the system. A recent example. I had a customer traveling from Boston to Hong Kong, then on to Xiamen. Back to Hong Kong with a stopover, then back to Boston. He was full fare First Class, which was VERY good for United. But Sabre priced the booking as a Business Class fare only! Now there is a fare rule that says you can charge the customer the through Business Class fare, adding a "differential" for the portions that they sit in First Class, if that's cheaper, but Sabre forgot to add the differential. The First Class fare to Hong Kong (HKG being a HIP, so we would use the HKG fare) from Boston should have been $12687.80, but the ticket issued at $8139.80. Not quite as good for United, but great for the customer. That's one of those times when you ask for the credit card immediately! Sabre also fixed the error the next day.

rufus102

Does this explain why my attempt at JFK-SFO(28hr stopover)-MEL-SFO-JFK price around $2500 back in March, whereas JFK-SFO-JFK ($300) and SFO-MEL-SFO ($1300) for the same dates?

sftrvlr

Without knowing the exact flight details, it is probably a different fare rule in effect for that one. The reason that 2 tickets are cheaper in this case is (probably) due to combinability requirements. One of the fares is not combinable on the same ticket with another fare. This happens a lot trying to combine cheap intra-Europe fares on the same ticket with the trans-Atlantic fare. Or in the above case, it could be inventory management kicking in when you try to price it all together. They may only want to sell $2500 tickets from NYC to MEL, so the computer is set up to price that way. But they still want to sell $1300 SFOMEL tickets, so those are still open for sale.

rufus102

The price without the 28 hour stopover was approx $1550. I had priced it on the website, then decided to include the stop over and got the much higher fare, so I called instead and the agent told me to get two seperate itineraries.

Details: 3/6 JFK-SFO - 3/7 SFO-MEL 3/19 MEL-SFO 3/19 SFO-JFK

sftrvlr

Ah, now it makes sense! The original fare didn't allow a stopover, so when you repriced with a stop, the computer used the lowest fare from NYC to MEL that allowed a stopover at SFO. If the roundtrip domestic fare was combinable on the same ticket with the roundtrip international fare, the computer (probably) would have priced it this way, but if the fares weren't combinable, it would use the lowest through fare to Australia that allows a stop. Only an agent can force it to split the ticket (keeps us employed for now!)