Why would QFA give more seat room in Economy at the expense of shareholder return?
Certain shareholders may have different priorities, but let’s assume many look for long term value and returns.
Adding an extra row (eg what QF did on the 787) added 7 seats, at the expense of about 2” per Y row.
That short term return (which is only found when on a fully loaded cabin) is lost whenever the load is less than about 95% full. Qantas (traditionally) has had a full service bundled fare, with a price to match. The most price sensitive are already often not flying QF (and flying BFOD).
That leaves those who are willing to pay more, but for better than a basic seat on a LCC. You’re competing with airlines all touting how good their economy is. Better meals, better IFE, better more comfortable seats. These people fly once, and may try something else next time. Long term repeat business for the shareholders? Not likely.
Qantas could have sacrificed a row of Y that is only generating revenue when loads are 1. Maybe their revenue management believe they have the ability to achieve that. I believe the long term play of giving Y the extra room and aggressively marketing it as the “best/most spacious economy in the world” alongside their push of the “longest direct flights in the world” would have been far more beneficial to the long term perception of QF Y, and QF as a premium airline. It would have spilt over to all QFi, even when not on the 787. Those who prefer comfort and are happy to pay a small premium would - giving increased yields.
Maybe QF think they can maximise their revenue and loads to have completely full planes all the time. The advertised Y sale prices to LHR at their lowest levels I can remember ($1300 MEL-LHR-MEL for flights in 2 months time) suggest otherwise.
A reminder to the bean counters that a simplistic view of more seats = guaranteed more revenue doesn’t hold true.