Article: The Most Profitable Seats on the Plane Are Not What You Think

[AFF Editor]

Canonical URL

https://www.australianfrequentflyer.com.au/premium-economy-profitability/

The Most Profitable Seats on the Plane: Not What You Think is an article written by the AFF editorial team:

The Most Profitable Seats on the Plane: Not What You Think

There's a common misconception that airlines make the most profit from Business and First Class seats. Nowadays, the best earner is Premium Economy.

www.australianfrequentflyer.com.au

You can leave a comment or discuss this topic below.

 

[OZDUCK]

I was sure that i had seen mention of a Premium Economy seat on some QR flights and found the article I was thinking about. QR does actually offer a Comfort+ seat but it is only on those few aircraft it snaffled up from CX and Virgin Australia. Obviously these are 'special' aircraft and does, to me at least, support your argument that QR should embrace the PE option.

https://www.executivetraveller.com/news/qatar-airways-premium-economy#:~:text=Some%20Qatar%20Airways%20flights%20offer%20the%20comfort%20of%20premium%20economy%20seating.&text=While%20Qatar%20Airways%20has%20new,this%20year%2C%20Riyadh%20Air).

 

[eastwest101]

A pretty good write up of the state of affairs with PE seating and where it is most common and why. And I think this mostly is all a subject that is most applicable in med to long haul international flights.

Matt - I think your point about the increasing F and J fares due to their large footprint and higher cost per unit to supply and serve, along with the decrease of Y class seat pitch and width in the inevitable race to the bottom makes it clear that as airlines attempt to make flying Y class long haul so unbearable that people pay to escape the Y cabin is a big part of this story.

The other part maybe not touched upon, is changes and dynamics of corporate and/or government travel policies? Obviously every corporation and government is different but I would love to see if various policies along the lines of "No J class travel ever permitted" or "J class only for Executive level for a duration of > 6-8 hours", all travel must be in Economy" etc would be worth examining more closely, although I would imagine that getting real data about this would be very difficult.

One more thing that might be plausible would be a demographic story, an ageing population doing more long haul travel overseas than previous generations but still having to contain itself to some sensible budget while refusing to subject themselves to standard Y seating might be a growing trend in some wealthier nations (and maybe growing middle and upper classes in the developing world?). A skewed age profile of PE pax compared to J F or Y class passenger lists would confirm this but I bet the airline revenue management people can't even get this sort of granular data yet.....

 

[Berlin]

Well- I’m one of the people who really never understood what the fuzz was about this odd in between class and always perfected what has already happened at some airlines: They’ll just make the real Economy so awfully bad, that suddenly the much more expensive PE makes sense to some.

But the very pricing example in the article is why I would never in my dreams pay for PE, given I fund almost all my travel out of my own pocket. Saving a thousand bucks to end up in a pretty awful non proper bed seat after all? And if someone doesn’t have status, you even forgo access to the lounges! No way in hell would I do this- then I rather fly in proper Business in an airline that is not as outrageously expensive as Qantas. Often you can get a proper J class ticket for only a tiny bit more that what Qantas charges for PE, not that rarely even on another One World carrier if that matters to you. But no doubt, PE will be “profitable” for the airlines which kind of proves my point.

But people are all different and there are many “I rather spend my money on the destination” kinda folks out there. For me personally, the joy of traveling in Business is way too important to ever book anything below J class. Unless maybe you are using points redemptions and on certain routes PE is available but J is not (SQ redemptions come to mind where PE is almost always available but J requires a fair bit of search often).

 

[Forg]

Well- I’m one of the people who really never understood what the fuzz was about this odd in between class and always perfected what has already happened at some airlines: They’ll just make the real Economy so awfully bad, that suddenly the much more expensive PE makes sense to some.

PE was different when first introduced … I recall my parents going to the UK on BA not super long after they introduced the product, it was around $2200 return when Y was about $2k return. And for the extra $200, your knees weren’t wedged up against the seat in front, you could sit comfortably without pulling your arms in hard against your side the whole time. At that price-point, it made a lot of sense.

A decade-ish later (2012) I flew PE to the UK on CX/BA. The value equation wasn’t quite as good, but still, the massive amount of extra comfort from a few inches of pitch & a couple of inches of width was well worth it, paying double for J wasn’t something I was willing to do.

But by 2018 plenty more businesses had said “no J for you!” to their employees, the demand had embiggened massively, and we got a discounted Business for appreciably less than Qantas or Cathay wanted for PE at the time. PE on those airlines was well over double Y, and only ~75% of J. It’s hard to quantify the lack of physical pain when you’re not trapped in it for 22 hours, so justifying PE prices is difficult unless you’ve suffered through a few long-haul Y’s recently, IMHO.

 

[Himeno]

If Qantas were to install PE on the A330s, they don't have to sell the seats as PE on the shorter routes (such as transcon/golden triangle/NZ) if they don't want to. They can sell them as economy with the extra legroom surcharge which they already do for selected seats.