Cheap seats are no longer sufficient for travelers on airlines.
Travelers have demonstrated to airlines that they are prepared to pay more to seat in the comparatively roomy front section of the aircraft since the outbreak. Since many of the seats are already taken, frequent travelers have a difficult time getting free upgrades to the front of the aircraft.
Additionally, there is increased competition for those seats as the ranks of frequent passengers with elite status are growing from the airport lounge to the crowded first boarding group. Airlines forecast that the year-end Christmas period will see even more crowds, setting yet another record.
In early 2025, CEOs have predicted robust demand even during the off-season. According to aviation data provider Cirium, the capacity of U.S. carriers in the first quarter would increase by roughly 1% compared to the same period last year.
At a November investor day, Delta Air Lines President Glen Hauenstein stated, “We’re probably seeing our best unit revenues on the transatlantic [routes], for example, in the dead of winter.”
Of course, factors like distance, demand, season, and even time of day affect the price difference between first class and coach. For instance, during the first week of February, a round-trip ticket on United Airlines from its hub in Newark, New Jersey, to Los Angeles International Airport cost $347 in standard economy and $1,791 in the airline’s Polaris cabin, which has lie-flat seats but no access to the international business-class lounge.
During the week of Easter in 2025, American Airlines’ nonstop travel from New York to Paris cost $1,104 in coach and $3,038 in Flagship Business class.
The airline industry depends on billions of dollars in revenue to stay afloat. Airlines’ loyalty programs are a money-making machine, and it’s crucial to strike the correct balance between offering benefits like free upgrades and making money.
Airlines have modified the requirements to obtain status in recent years, rewarding spending in addition to mileage traveled. Additionally, they have increased the cost for fliers to be granted elite status. Customers will need to spend more on United in order to obtain status next year. However, American announced on Thursday that it would maintain its criteria for the upcoming fiscal year, which starts in March.
From giveaways to paying up
Just 12% of Delta’s domestic first class seats were paid for by passengers approximately 15 years ago. Last month, Hauenstein informed investors that the percentage was approaching 75% and increasing.
We gave them away based on a frequent flyer system, Hauenstein said about first-class seats in 2010 and earlier. Spending as little as possible, flying as long as possible, and getting upgraded as frequently as feasible were the incentives. As a result, our most valuable products ended up being the main causes of loss.
He claimed that since more money is now going to the front of the cabin, Delta has reversed that. The carrier generates 43% of its revenue from main cabin economy tickets, down from a 60% share in 2010.
The trend is cutting across the industry, from Delta, the most profitable carrier, to discounters such asFrontier Airlines, which is adding roomierfirst-class seatsto the front of its Airbus fleet in 2025. On Wednesday,JetBlue Airwayssaid it would introduce two or three rows ofdomestic business classon planes that don t have its highest tier Mint business class with lie-flat seats, dubbing it junior Mint.
A day earlierAlaska Airlinesannounced it wouldretrofitsome of its planes with premium seats as it readies new international flights after acquiring Hawaiian Airlines earlier this year, with revenue from higher price seats outpacing standard economy
You see the Airbus 330s and the Boeing 787s are under-indexed in business class and lack an international premium economy cabin, Andrew Harrison, Alaska s commercial chief, said at an investor day in New York on Tuesday. So we expect that beyond 2027, you will see our premium mix continue to grow.
Bigger business
Airlines are now racing to add first-class sections or bigger international business classes featuring bigger screens and closing doors to the flatbed seats.
We ve seen more paid demand for premium cabin than we ever did pre-pandemic, said Scott Chandler, vice president of revenue management at American Airlines. More people want the experience of the premium cabin.
Chandler said American has worked over the past few years to make it easier for customers to buy up to pricier cabins, with post-purchase options to upgrade to first class or other cabins such as premium economy.
American isretrofittingsome of its longer range aircraft to include more premium seating, like other carriers, ditch first class entirely on some to add larger international business class cabins that will have new seats with sliding doors. Delta and United have alsoincreased their premium offeringsto keep up with customers who want to pay for the pricier seats.
They are doing everything they possibly can to entice you to pay for their premium products. That s absolutely what they should do, said Henry Harteveldt, founder of travel consulting firm Atmosphere Research Group. Customers don t buy a store-brand item at a department store and then expect the sales person [to] ring up that product and hand you a designer bag for free.
Southwest Airlineshas taken its own approach. In 2026, it plans fly with several rows ofextra-legroom seats, retrofitting its standard coach-only cabins that it has flown for more than half a century and doing away with open seating.
CEO Bob Jordan said it s partly a generational shift.
What we re seeing is our younger customers seeking a little more premium, he said in an interview this week. A lot of this a mentality shift, the willingness to spend more on travel and less on other things.
But the airline decided to keep the number of seats on its aircraft largely similar and isn t adding a first class like other carriers, after surveying customers and weighing the cost of losing space for more seats on board.
For first class, Jordan said, You re talking ovens, you re talking meals, you re talking provisioning. It s a huge capital investment and a big leap.
But never say never, he said.
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