They go in some sort of order of frequent flier status/revenue generated/miles flown. The computer systems rank all the passengers on the flight by their scoring and they go down that list. They won’t always upgrade, eg. may only do so if there’s an open seat AND somebody over a certain scoring (eg. a platinum of 1K flier, but not if they’re just a silver or gold), or if they have standby passengers they need seats for, etc.
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