- Delta is planning to launch its premium economy service on some transcontinental flights.
- Premium economy seats can cost twice as much as standard economy for some flights.
- Delta has said revenue from seating like premium economy or first class is growing faster than sales from standard economy.
Delta Air Lines said Monday that it will bring its premium economy service to transcontinental flights in September, its latest attempt to boost sales of higher-priced tickets to customers willing to splurge for more space and perks.
Premium economy is a relatively new class of service that major airlines offer on longer, mostly international flights. It sits between first or business class and the rest of economy and can command a ticket price often twice as much as standard coach.
Delta and its rivals like United are locked in an arms race to outfit planes with more premium seating, upgrade lounges and sell more rewards cards to capitalize on higher-spending travelers, while airfare overall slips. JetBlue Airways this year said its turnaround plan will emphasize profitable routes that offer its Mint business-class cabin. Even Southwest Airlines, under pressure to increase revenue, is considering a more expensive seat on its planes, breaking from its decades-old business model.
Ticket revenue from Delta’s main cabin rose 4% in the first quarter to $5.4 billion from a year ago, while premium-product revenue came in 10% higher at $4.4 billion.
The added service will start Sept. 10 on four of 11 peak-day flights between Los Angeles and New York’s John F. Kennedy International Airport on Boeing 767s. Delta said it plans to expand service later this year.
Delta customers who purchase standard economy tickets will be able to pay for upgrades to premium economy on the transcontinental flights.
Delta said Medallion elite members of its loyalty program, will be eligible for complimentary upgrades to so-called Delta Premium Select, but they will also be able to list for upgrades to its top-tier Delta One product on those flights.
Some of Delta’s planes flying some routes previously had premium economy seats on them, but the carrier wasn’t offering the service that comes along with it, like amenities kits, noise-canceling headphones, a full meal and a blanket. The seats were sold as extra legroom tickets, which are a rung below premium economy.
Some American Airlines‘ shorter domestic flights operate a similar model, featuring lie-flat seats but not the Flagship service offered on international flights.
Source: Business - cnbc.com
