Doesn’t the airline actually save nominally on the connecting flight by not having to haul the kid’s weight and baggage? I get they don’t get the shakedown fare they want to charge but isn’t that really because they have inconsistent and unfair policies when it comes to setting fares?
In no way defending the airline’s actions here, but in theory they are trying to price discriminate. From their perspective, would have probably preferred two nonstop fares at a higher price
It's slightly more than the missed revenue from the failed shakedown. An empty seat is a seat that could have been sold to someone who paid full price. If you hadn't checked in for the flight you weren't intending to take, they could have made a bit more money.
And yet they were so eager to pay the passenger (in the form of a discount) to block that seat on the second leg from being used by a hypothetical other paying customer, even though the passenger being paid to sit in the seat didn't actually want to.
Direct flights from A->B command a premium price. The reason the airline comes out money behind is that the person did not choose the pay that premium for the direct (or less stops) flight.
Generally the premium is higher than the increased cost of one more passenger on that last leg.
