Page 23 - AAA MARCH - APRIL 2018 Online Magazine

economy plus product for some time. Last are being financially savvy—working the odds in our favor,
year, at its media day when Delta Air Lines getting something for nothing.”
chief executive Ed Bastian announced the This psychology and this product positioning is essential
airline was moving to a dedicated pre- to the success of a Premium Economy cabin offering says
mium economy product he said that the the Skift report. “It must fit in a Goldilocks zone. It must be
airline had learned from its partners Virgin affordable enough for Economy passengers with a little extra
Atlantic, and Air France. Yet the evidence change in their wallets to spring for the upgrade, while not
from around the globe of the success of being so comfortable a product offering that it competes
premium economy has been compelling with the airline’s Business Class.” While getting the balance
for years. Likewise, American and United, right to ensure that Economy passengers are buying up, not
have only recently announced a move to a Business passengers buying down Mr Goode says “if airlines
dedicated PY cabin. However, it should be are operating Premium Economy well, it is the most profit-
noted it is only in recent times that these able class in the cabin.” And another plus is that Premium
three giants have thrown off the trauma of Economy does not require by comparison a large investment.
Chapter 11 bankruptcy protection and years
of losses to make healthy profits as the
US airline system restructured – yet again
as de-regulation continues to ravage what
was once the world’s best airline system.
Delta will progressively roll out the premium
economy cabin to its 777 fleet, followed by
its A330-200 and 767-400.

Not a New Concept
remium Economy dates says Skift
to Virgin Atlantic in 1992, but in fact
some suggest British Caledonian
Phad the concept in the upper deck
of its 747s on the route from Gatwick to
Houston in the mid-1980s, while EVA Air
introduced its in 1991. Regardless, what
Virgin Atlantic did was special, profitable,
and enduring says Skift. “It worked on a
very human factor: that all of us, regardless
of class, have a little elitism in our veins. We Burgeoning Demand
all want to be a bit better off than our peers.
We all want special treatment, and are will- Today approximately 40 airlines are offering premium econ-
ing to pay for as much special treatment as omy – mostly on longer haul aircraft. Of those 13 are from
our wallets can afford.” the Asia / Pacific region and generally the region leads with
“It’s the same reason why frequent flyer EVA Air adding it in 1991. What is surprising is that Qantas,
programmes have been so successful. The which has some of the world’s longest routes and tallest
competitive nature of reaching that Gold, passengers, didn’t introduce it till 2008 on its A380s. The
Platinum, Titantium or Paladium or what- author made a presentation to the airline in 1997 on the vir-
ever other “um” brands give us as the next tues but was told by the then - and the late - CEO James
better step, is addictive.” Skift notes that Strong “it couldn’t make the business case.” Later in 2008,
“because, to achieve this status, one has outgoing CEO Geoff Dixon admitted that “it was mistake” not
to do very little beyond spending what we to introduce the class sooner. Now Qantas claims it has the
would spend anyway (occasionally spring- world’s best premium economy product on its new 787-9s. Its
ing for a bit more) to chase a better status, premium seat is indeed crammed with features and places
it is easy to justify. We are not being spend- to put all the essentials for today’s air travelers.
thrifts, the rationale goes, if anything we Wider than most, and with more functional space over

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