Airlines add premium, first class seats as travelers treat themselves

Airlines spent decades cramming as many seats into coach as possible. Now they’re focusing on adding roomier seats in a worldwide chase for high-spending travelers like Natalie Rasmussen.

“I’m not going to fly to Europe in 36B. 36B is a bra size, not an airline seat,” said Rasmussen, an application scientist who lives in near San Jose, California.

Rasmussen said she won’t fly in standard coach on long-haul flights. Instead, she opts for business class or premium economy, a newer cabin that sits between business and coach and offers more legroom, a bigger seat-back screen and other perks but not the lie-flat seats of front-of-the-plane fame.

Premium seats yield many times standard coach fares, making them even more important to carriers as ticket prices, generally, fall and business travel’s rebound from the Covid pandemic levels off. Airline executives have said customers have shown a willingness in the wake of the pandemic to pay for more space on board.

Rasmussen said she recently paid $500 to upgrade on her way home from Europe to ditch premium economy and fly in Delta Air Lines‘ highest-end cabin, Delta One, which comes with a lie-flat bed, large entertainment screen and a privacy door.

“I clicked ‘yes’ so fast,” said Rasmussen, 43, who visited London, Germany and the Czech Republic on her latest trip and purchased a ticket in Virgin Atlantic’s premium economy class on the way over.

Pricey tickets

Airlines are in an arms race to outfit thousands of new aircraft with high-end seats — and more of them.

Economy seats account for 79.3% of seats between the U.S. and Europe, down from nearly 81.9% in 2018, before the pandemic, according to aviation data firm Cirium. Business-class seats’ share of seats sold has grown slightly, from 12.9% to 13.5% though premium economy’s share has increased even more, making up 6.4% of seats sold, up from 4.2% five years ago, while first-class seats’ share fell.

Delta, JetBlue Airways, United Airlines, American Airlines, Finnair and Lufthansa are among the carriers that have recently announced upgraded first-class seats, suites with sliding doors or premium economy cabins.

Some of the newer first-class cabins, like those offered by Singapore Airlines, have full-height doors, joining beds for travel companions and the square footage of a small hotel room. Emirates even offers an onboard shower for first-class passengers on some aircraft.

Singapore Airlines A380 first class suites

Leslie Josephs | CNBC

“Getting from A to B isn’t necessarily what they’re selling anymore. Anyone can do that,” said Edward Dryden, president of the interiors unit of Collins Aerospace, top manufacturer of aircraft seats and part of aerospace and defense company RTX.

“It’s that experience within the cabin,” he said.

The price differences can be vast. A premium economy ticket between New York and Paris leaving Sept. 22 and returning a week later was recently going for $3,015 on Delta Air Lines. The same route in regular economy cost $980. On rival United Airlines, a similar itinerary was nearly $1,850 in premium economy and $912 in standard coach. Business class easily tops $5,000 for that route.

More high-end seats

The upper-end seats are just a slice of the aircraft seating market, which consulting firm AeroDynamic Advisory values at $2.6 billion. But it’s growing.

A Delta spokesman said 9% of seats sold in 2009 were premium. By 2019, that percentage was 28% and in 2024, the company expects it to ring in at 30%.

Delta said it expects sales from premium tickets — everything from extra legroom seats to international business class — will account for 35% of the record $19 billion in revenue it expects to generate this year, up from a 24% share of its $10 billion in sales in 2014.

Rows of American Airlines’ new Flagship Suites

American Airlines

American Airlines, for its part, plans to replace its Flagship First Class on some Boeing 777 planes to build a business-class cabin with 70 suites, featuring sliding doors, to debut next year. Fort Worth, Texas-based American said premium seats on its long-haul aircraft will grow by more than 45% by 2026.

Delta and United have also unveiled new first-class seats for domestic flights that feature privacy wings, what’s becoming a popular feature after the pandemic.

Getting the balance right between seating options is key, according to Virgin Atlantic CEO Shai Weiss. The London-based airline offers different configurations that include more economy seats on routes that are more popular with vacationers, like London to Orlando, Florida, and higher concentrations of Upper Class seats on routes where travelers are willing to pay more to fly.

“It’s not like you can just wake up in the morning and change it, especially in the premium cabins,” he said.

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