The demise of first class

[trippin_the_rift]

Casting a quick eye over this AusBT article which talks about the potential demise of first class: https://www.ausbt.com.au/airbus-a350-1000-signals-rise-of-business-class-demise-of-first

Killing off first class in favour of more business class seems to be a trend with more airlines shifting towards alternate configs (econ+prem+biz, all econ, econ+biz etc.)

I can't help but wonder if airlines are going down the wrong path by culling first class.

- We live in the richest time in human history. You, me, and everyone else in the world have more income than ever before. There is no affordability issue.
- We also live in a time where there are more people who can fly. No shortage of potential passengers.
- The luxury goods market is off the charts and growing rapidly. People want to pay more for stuff.
- The private jet market continues to grow, while first class commercial seats continue to decline. People will pay for speed and privacy.

What possible reason could there that some airlines are moving away from offering a first class product?

Is there no value in first class as a premium product? Do airline marketing people just suck at their jobs?


Light reading:
https://www.ausbt.com.au/airbus-a350-1000-signals-rise-of-business-class-demise-of-first
Growth of Business Jet Market Forecast at 6.86% CAGR to 2020 With Increasing Demand from Middle
Business Aviation Market Summary - May 2016 | AvBuyer

 

[dajop]

I think it is very simple:

1) Business class has never been as good as it is now and people - even those who could afford it - question the value vs the extra cash they need to pay for F.
2) Why spend cash when you fly F using points?
3) Large MNC's are becoming increasingly frugal (perhaps except for their top execs, who often fly around in biz jets anyway, due to the convenience).

My gut feel if F is to make a comeback, it's not the onboard product that needs work, it's the before and after the flight that does (and I'm not talking about F lounges with celebrity chef inspired menus).

 

[Moindardt]

I have a couple of clients who have changed to Emirates and Etihad because they only fly paid F. It also means when they take their adult kids and their families on holidays, they are all flying on those airlines as well. They all seem to not particularly like flying and want the shortest path in the most comfort as possible.

Personally I think allowing upgrades from J to F to ensure F is full is a far better option. It increases loyalty and aspirational spending. The whole idea of an empty F is just stupid.

 

[cove]

Yes Moindardt I see First class as aspirational too.

 

[DaveB]

Did my first J flight on a 380 across the ditch a few months ago. Being aware of whole J decks was not the same as seeing it for the first time indicating to me how awash the world is in money or should I say credit.
Doubt F will disappear though has to be greater definition now J features of lie flat beds and direct aisle access pretty much standard offer across all major airlines. Funnily enough, the Etihad Residence cocoon style treatment is thankfully a big turnoff to my wife though could understand celebrities might enjoy the offer of total privacy.

 

[Spongbob]

- The private jet market continues to grow, while first class commercial seats continue to decline. People will pay for speed and privacy.

I think your (above) comment has given a good reason for the reduction of first class cabins.

 

[trippin_the_rift]

I think your (above) comment has given a good reason for the reduction of first class cabins.

It's the point i'm alluding to in this thread. Why do some airlines view it as a competitor to business class, when it's actually a competitor to private?

If you're using points to upgrade... are you really the type of customer the airline wants in first class?

 

[NZflygirl]

It's the point i'm alluding to in this thread. Why do some airlines view it as a competitor to business class, when it's actually a competitor to private?

If you're using points to upgrade... are you really the type of customer the airline wants in first class?

To be fair I think the type of customer the airlines want are someone who spends money with them and if a wee reward in F is what's required to keep you flying J or anything with them then yeah - I think they'll want you... well, your money at least. EY can extract a bit of $ out of someone via their upgrade system. Might as well make money from that empty seat!

I also think those that can afford F are probably buggaring off to private. No queues, the plane can work around them (although I understand there may be a small wait), just rock up, get on and you're off, then grab bags and you're gone! Nice! Stuff AFF dreams are made of

J is pretty good though and it's difficult to argue the extra $ to fly F. Although if someone else is paying J then I view it as a good opportunity to try F e.g. EK I did that once but it's not something I would do routinely/annually etc. And with points, well if I can get the same thing for less that leaves $ to spend on something else! Hence trying out QR - if I can get Qcredits to upgrade to F then there won't be any need to spend $ on buying AA. (Although I did just buy AA for the purpose of flying F on QR and EY). Just feeling my way around the various travel systems so I will know them better for when I'm retired or something but also might help me out with my family. I know the systems will change over time but good to know how things work.

 

[jenib]

I'm wondering what the current polly entitlements scandal will do to the F class arrangements. When there was a crackdown a couple of years ago on pollies and public servants accepting upgrades, I scored two A380 F (opup) upgrades from paid J class (one with partner). I'm hoping the same occurs this time

 

[cove]

Our family has the points/miles so we simply book first class flights using redemptions.

 

[RooFlyer]

<snip>
If you're using points to upgrade... are you really the type of customer the airline wants in first class?

Probably only if it frees up a J seat for a revenue backside.

 

[harvyk]

- We live in the richest time in human history. You, me, and everyone else in the world have more income than ever before. There is no affordability issue.

No affordability issue? A single return F flight is several months income for the average person. With businesses been forced to cut back costs where ever possible due to shareholder demands it is now only a very select few whom can actually afford a seat (let alone multiple seats) at the very pointy end.

- We also live in a time where there are more people who can fly. No shortage of potential passengers.

Only because of the LCC's, which of course provide the "sit down shut up" service. Whilst some of those LCC pax might be expecting champagne service on a $9 fare, the reality is that for a good number of the pax which are now flying, short to medium haul, LCC's is about their limit. Even long haul Y or flights on full service airlines are out of the question. (Keep in mind, they're not AFF people and therefore don't know the tricks of actually flying cheap).

What possible reason could there that some airlifnes are moving away from offering a first class product?

Is there no value in first class as a premium product? Do airline marketing people just suck at their jobs?

So here is the crux of the issue, First Class is pure luxury, but business class is very very good. Outfitting an aircraft with F seats is expensive, both for the physical seat itself, and for the space which is now occupied by a single person assuming it is occupied at all. An airline is going to want to get very good returns on those seats, and that means full fare paying travellers, and full cabins on all flights.

So where is F going? It's disappearing because of the improvements in J are so good these days that it's eating into the traditional market of F. It's disappearing because BFOD and other travel policies are forcing those traditional F flyers into Y, Y+ and J. It is those sorts of things which are eroding F's traditional market. Airline marketing people don't suck at advertising F, it's just without enough people willing to part with enough $$$ to fly F, and / or without airlines charging enough for F seats to make a decent return on those seats no amount of marketing can save it.

Of course we're not going to see the end of F. There are still enough people out there whom want to spoil themselves (and have the means to do so), whom will continue to pay the big $$$ to make F viable at least on some routes, for some airlines.

 

[juddles]

.........

So where is F going? It's disappearing because of the improvements in J are so good these days that it's eating into the traditional market of F. It's disappearing because BFOD and other travel policies are forcing those traditional F flyers into Y, Y+ and J. It is those sorts of things which are eroding F's traditional market. Airline marketing people don't suck at advertising F, it's just without enough people willing to part with enough $$$ to fly F, and / or without airlines charging enough for F seats to make a decent return on those seats no amount of marketing can save it.

Of course we're not going to see the end of F. There are still enough people out there whom want to spoil themselves (and have the means to do so), whom will continue to pay the big $$$ to make F viable at least on some routes, for some airlines....

I think in this part of his post harvyk has summed up exactly what the situation is.

 

[Kangol]

- The private jet market continues to grow, while first class commercial seats continue to decline. People will pay for speed and privacy.

In the (long haul) commercial F vs private debate, in many cases there is a huge difference.
There are many people who can easily afford F but no way could they ever afford private.
Look at SYD-LHR for example. How much would it cost to charter a jet by the likes of Bombardier, Gulfstream on that route?
Compare it to a range of commercial carriers. Google flights shows an F ticket can be bought departing tomorrow on TG for just over $6k and on SQ R for ~$8.5k. EK is just under $10k.

Whilst I do not disagree on your sentiments regarding flying private, there is a lot of dissimilarity between the two markets.

 

[Jeffrey O'Neill]

Whilst I do not disagree on your sentiments regarding flying private, there is a lot of dissimilarity between the two markets.

My understanding was the Etihad Residence was targeting those who would ike to fly private but couldn't afford it.

 

[codash1099]

It's the point i'm alluding to in this thread. Why do some airlines view it as a competitor to business class, when it's actually a competitor to private?

If you're using points to upgrade... are you really the type of customer the airline wants in first class?

I suspect that much of F is filled with points upgrades and redemptions. Airlines are quite happy to take the money on one end of this deal but are somewhat reluctant to see the points actually used.

 

[MEL_Traveller]

In the (long haul) commercial F vs private debate, in many cases there is a huge difference.
There are many people who can easily afford F but no way could they ever afford private.
Look at SYD-LHR for example. How much would it cost to charter a jet by the likes of Bombardier, Gulfstream on that route?
Compare it to a range of commercial carriers. Google flights shows an F ticket can be bought departing tomorrow on TG for just over $6k and on SQ R for ~$8.5k. EK is just under $10k.

Whilst I do not disagree on your sentiments regarding flying private, there is a lot of dissimilarity between the two markets.

This. And... who wants to spend 24 hours in a 14 seat jet? Gimme the wide-body experience with showers, bars, enclosed suites, multi course meals with options for each course. The time saving on long haul is probably less significant... the one hour before departure at an airport means a lot less on 24 hours than it does on 2 hours.

I had a quick look for 'private jet transatlantic' - they are quoting £81000 return LHR-MIA. 12 seats. That's comparable to a full First return on BA, but you gotta fill all 12 seats. And when you do that you ain't getting a bed

Crossing the Atlantic by private jet | PrivateFly

 

[harvyk]

Just had a look a that private jet service. Apparently some of their long range aircraft do have lie flat beds. So if you had 12 people to move in luxury, this would be a valid option compared to commercial F. However without all 12 seats filled it starts becoming very expensive very quickly.

 

[MEL_Traveller]

But still - would you want to fly for any significant distance in the equivalent ERJ35? Those are bad enough for an hour. Then there's the experience of the pilots (are they up to standard of legacy carriers?), and how does crew rest work? You'd probably have to go for two stops from Europe instead of one?

 

[Himeno]

My understanding was the Etihad Residence was targeting those who would ike to fly private but couldn't afford it.

It's targeted at those who will see the price for the residence seats and then view the price for the next class down as "not too bad" while it is still quite high.