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I read on https://www.flypointyend.com/5th-freedom-flights/ (mirror):

The fifth freedom allows an airline to carry revenue traffic between foreign countries as a part of services connecting the airline's own country. Fifth Freedom flights are often heavily discounted and it is prudent to keep abreast of the current 5th Freedom routes.

Why are fifth freedom flights more often discounted than regular flights?

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Airlines offering these fares operate outside their "normal" market and into a foreign market in which they typically have very little market share or assets. Also the flights are typically paid for and put forth in light of the main itinerary, not the sub itineraries. One can consider any revenue captured on sub itineraries gravy. As such they have very little to lose in being aggressive on these sub itineraries, and their competitors on these sub itineraries (who may have to sustain the economic viability of the flight in its entirety) are more challenged to respond or retaliate. Note that I base my statements on my experience of economics applied to travel, but not on direct insider knowledge from airlines pricing desks.

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    +1. On the demand side as well, a fifth-freedom flight that operates once a day or less with zero flexibility will also be less attractive than a local carrier that flies hourly and can change you to a new flight easily, so few businessmen will choose one and they need to be priced attractively to sell. Commented Dec 27, 2020 at 1:45
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    I flew Air India's fifth freedom route from Heathrow to Newark once. There were 3 of us in the business class cabin, and that was even with seats priced dramatically below what other carriers were charging on the normally lucrative London-New York route (I needed a one-way ticket as part of a multi-city trip, so it was hard to find anything not wildly expensive). That was not a flight popular with business travelers at all. Commented Dec 28, 2020 at 10:04
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    @ZachLipton FWIW, Air India is not popular with business travellers even in India, it's not a great airline. Friend of mine got food poisoning from an AI business class meal once... Commented Dec 29, 2020 at 1:07
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The main reason is that not all passengers will remain in the plane for the whole "way", and there would be to many empty seats.

For example Singapore to Houston with Singapore Airlines, this is routed with a short stop via Manchester. Manchester Houston is considered as a 5th freedom route, people in that plane could have bought a ticket from Singapore to Manchester only and leaving the plane in Manchester, or they could stay in the plane from Singapore to Houston with the short stop in Manchester.

But not all those 5th freedom routes are often, or more often, discounted as other routes. It all depends on the empty seats...

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