Are Premium Classes Being Diluted?

nce upon a time, there were three airline classes available aboard an airplane on international flights and domestic routes which were heavily traveled: first class, business class, and economy class; and this configuration still exists on some airlines…

…but they are becoming fewer and fewer. Slowly, the first class cabin disappeared on airline after airline. Business class became the new premium class of the highest tier on an airplane.

Then, airlines introduced a premium economy section. Originally meant to be an enhanced seat in the economy class cabin, airlines such as Delta Air Lines are now treating premium economy class as a completely separate and independent cabin.

Meanwhile, airlines introduced a class of seat known as basic economy class at lower airfares in order to compete with ultra-low-cost carriers — but the benefits and amenities are severely limited; and the airfares often are higher than those offered by ultra-low-cost counterparts.

Might we one day see a legacy airline with a choice of cabins which range from basic economy to regular economy class, with the highest level of premium class being premium economy class — or perhaps eventually eliminate the premium class cabin altogether?

Perhaps a better question might be: are premium classes being diluted?

615: Record Number of Seats on One Airplane by Eliminating First Class

As airlines seem to want to cram more seats into the economy class cabins of their fleet of aircraft, perhaps the premium economy cabin will eventually be what the regular economy cabin used to be in the past. Consider Emirates Airline, which unveiled a new Airbus A380 airplane equipped with 615 seats that will carry passengers between Dubai and Copenhagen — a record for the most seats on one airplane to be introduced into commercial service. 58 of those seats will be in the business class cabin; and passengers will be able to lie flat in them.

This means that — for two of the Airbus 380 airplanes which were recently delivered to Emirates Airline — the first class cabin has been eliminated, along with the shower which accompanied it; and it also means that Air France will no longer hold the record with an Airbus A380 aircraft in its fleet configured to seat 580 passengers.

There is no indication that those Airbus A380 airplanes operated by Emirates Airline will have passengers in the economy class cabin seated 11 abreast — but that is also not being completely ruled out in the future, either.

Neither members of InsideFlyer nor members of FlyerTalk are happy about that news.

Are Airfares Cheaper or More Expensive Over the Decades?

Some would say that the perceived reduction of the amenities associated with classes of service offered in recent years might be due to airfares themselves, which supposedly reflect that passengers are paying up to 50 percent less money for flights in 2013 than they did in 1978, when airline deregulation became effective. It is no surprise that members of Airlines for America — a lobbying trade group for commercial airlines based in the United States — have perpetuated the perception that airfares are indeed lower today than decades ago when adjusted for inflation. However, Joe Brancatelli vehemently argued that “the real price of flying has risen sharply since the dawn of deregulation and far outpaces the inflation rate of the last 40 years.”

If Brancatelli is correct, is this simply a long-term money grab from the airlines? Are the airlines perhaps taking a cue from some lodging companies which offer rooms which are slightly larger or have a marginally better view — or even rooms which are not immediately obvious that they are better than similar rooms in any way — as upgrades which come complete with a higher room rate?

Is Premium Economy Worth the Extra Cash or Frequent Flier Miles?

In many cases, premium economy class is barely premium when compared with what is considered today as typical economy class. You might get a couple of inches of extra leg room; perhaps a premium snack or an extra drink; upgraded upholstery on the seat; slightly better service from members of the flight crew; and maybe access to more options of the in-flight entertainment system. Is that really enough to warrant separating premium economy into a separate class altogether?

Managers at Delta Air Lines apparently think so. Would you pay $2,462.80 — which is $1,306.00 extra; or greater than double the $1,156.80 airfare of a regular economy class seat — for a premium economy class seat from New York to London? I would be hard-pressed to pay that to upgrade to a seat in the business class cabin — let alone a seat in premium economy class.

Redeeming SkyMiles does not seem to be a much better alternative. “…let’s look at LEVEL 1 award prices for C+ fares (yes Delta still uses award charts, they just hide them from us)”, posted a disgusted and frustrated René de Lambert of René’s Points in this article. “The price jump is a HUGE 40% for the amazing privilege of sitting in the exact same seat as the rest of coach with a few more perks. Glorious. Thanks Delta.”

Summary

Airlines probably conducted a lot of research and surveys; but I know I am not within their target market. I always viewed premium economy class as a nice upgrade for those frequent fliers who achieved elite level status but were unable to secure an upgrade in the premium class cabin.

In fact, I was at a restaurant with a couple of employees of Delta Air Lines in 2009 who confided in me about recognition of members of the SkyMiles frequent flier loyalty program who earned Medallion elite level status. That program was known as Have One On Us, which was introduced in early 2010 and provided those frequent fliers with coupons where they can get a free premium snack or drink if they were not upgraded to the premium class cabin. It was a nice program; but it was abolished sometime last year in 2014

…so now that premium snack and that extra drink could cost you dozens — or even hundreds — of dollars on a future flight by paying to sit in a seat designated as premium economy? I can buy a lot of other items or services which would be far more valuable to me than that.

I would even go so far as to say that — in terms of may as well calling the classes Decent, Bad and Worse — airlines seem to be currently engaged in the delusion of dilution pertaining to the illusion of distinct classes of service…

Photograph ©2015 by Brian Cohen.

2 thoughts on “Are Premium Classes Being Diluted?”

  1. Christian says:

    This is what happens when an industry over consolidates. Combine that with archaic and open market unfriendly policies regarding airline ownership, and you get a pretty bad situation for normal people. Not precisely what Alfred Kahn envisioned.

    1. Brian Cohen says:

      Perhaps over-consolidation will lead to market opportunities for those who develop disruptive technology that will compete with the existing environment, Christian.

      One problem with that, however, is that entry into the industry is difficult…

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