Will 2008 be the tipping point for premium economy, asks Alex McWhirter.
It’s 15 years since I first sampled premium economy, a class pitched midway between economy and business. I was flying with Taiwanese airline Eva Air (on the Gatwick-Vienna-Bangkok route) and I was mightily impressed. Here I was, sitting “up front” in one of Eva’s B747s, with comfortable seating, and better care and attention from the staff. Granted I was paying more than if I were in the back of the plane among boisterous groups of tourists, but my ticket cost a fraction of first or business class.
Back then it seemed premium economy couldn’t fail to attract passengers needing more space and value at a reasonable price. But I was wrong. Although Virgin Atlantic brought out its own version of premium economy at roughly the same time as Eva Air, and British Airways followed later, it’s fair to say that the product stagnated. It never gained global acceptance.
The reasons were various. Firstly, without the backing of a big home carrier, it was difficult to get the message across to travellers from that market. So while the UK business traveller was familiar with the product, without major carriers like Air France, Lufthansa, American Airlines, Emirates and Cathay Pacific offering premium economy to the residents of France, Germany, the US, and the Middle East, it was a battle for a carrier to get the premium economy message across in a foreign market.
There were other problems, however. The ability to buy a ticket was an issue. Premium economy has now been around for some 15 years, yet go back a year or so and you would find that the big online agents like Expedia and Travelocity still didn’t list premium economy in their availability displays. Why? Because their databases are located in the US, where no local carrier offers premium economy.
Even today, ANA and JAL do not display their premium economy seats with Expedia and Travelocity, although a JAL spokesman said this was the result of technical glitches which the airline was looking to remedy. So at present, a would-be passenger seeking to book a premium economy flight from London to Tokyo with Travelocity would believe that only British Airways or Virgin offered such a product.
Chris Birch, Virgin Atlantic’s product manager for premium economy, says: “It’s been harder for us to sell premium economy in those overseas markets where the national carrier doesn’t offer the product. We carry more UK-based passengers in premium economy than those from other markets.”
But there are signs of a renaissance. The economic downturn is starting to affect company budgets, making premium economy look more attractive than business, while well-heeled leisure passengers are demanding more comfort.
Spotting these trends, Virgin Atlantic has increased the size of its premium economy cabin. Virgin’s fleet of Airbus A340-600s see their seat count going up from 28 to 38 seats, while the carrier’s B747-400s have an even bigger boost from 34 to 62 seats. The extra capacity was installed on the Heathrow fleet last year. This year it will be extended to Gatwick.
There are other significant developments involving the two Japanese carriers JAL and ANA. The latter has offered premium economy for a couple of years on selected routes to Europe and the US, and JAL followed December, 2007 with a new design of “shell-backed” seating (see Flight Check on page 24). It has installed a 40-seat zone on flights between Tokyo and Heathrow. It will be extended to other European routes this year, followed by the US. It seems these carriers are adopting premium economy because of new and different travel patterns.
In Japan, it’s recognised that the classes which executives opt for will differ depending on their status. So how does premium economy fit in? JAL’s spokesperson Stephen Pearlman, says: “With conventional companies, first class is for senior management, business class for middle management, while non-management staff are expected to travel in economy class. But with newer companies the distinction between who flies in this or that class has become blurred.”
Pearlman continues: “In Japan, as has been the case worldwide, many companies are looking closely at their travel costs. In some cases, employees who used to fly business class are now being asked to fly economy on long flights in order to keep costs down. Our premium economy is primarily targeted at the business traveller paying a full economy fare and who deserves more for their money, although we also expect the seat to be popular with high-end tourists.”
Certainly the added comfort of premium economy comes into its own on very long flights, so it’s hardly a surprise that Qantas and Air New Zealand either have, or are about to endorse the product. Qantas will become a major player when it starts fitting premium economy across its B747-400 long-haul fleet starting April, 2008. From April the new seating will progressively appear during the year, starting with flights from Melbourne and Sydney to London, Singapore, Bangkok, Hong Kong and Johannesburg. Transpacific services to Los Angeles, San Francisco and New York will follow later this year.
Qantas also says it will fit premium economy to its fleet of A380s, which arrive in the third quarter of 2008. These will ply the “kangaroo route” to London. Air New Zealand is expanding by fitting 39 premium economy seats (up from 23 seats) on its B747-400s. It will continue to operate its B777s fitted with 18 seats. Most Air New Zealand flights operate over long sectors to Asia, the US and the UK.
BA is also fitting premium economy seats for the B757s to be used for its Open Skies offshoot. This carrier is set to operate between cities in mainland Europe and New York from the early summer. BA’s planes are adopting a three-class layout: Club World, World Traveller Plus and World Traveller. Otherwise British Airways’ existing product continues with “no radical changes”, according to a spokeswoman.
Dutch airline KLM is considering premium economy although no decision has been made. A spokeswoman says: “KLM is carrying out a viability of a class between economy and business. The results of this study are expected soon (early 2008) with the final decision being based on customer demand.”
Existing premium economy operators include SAS, which offers the seating on flights out of Scandinavia to Asia and the US, and Eva Air where it’s available on long-distance flights departing Taipei.
Bmi has refitted its former seating (barely distinguishable from normal economy) with its older business class seating. It was more cost-effective for Bmi to do this than to throw away the old business seats and commission new premium economy models. It also means that Bmi offers the most comfortable product of them all (with a bigger seat and a lot more legroom) so it seems a pity that it can only be found on flights out of Manchester to Las Vegas, Antigua, Barbados and Chicago.
Singapore Airlines and Thai feature premium economy on their very lengthy transpacific A340-500 flights. Both say the idea is to provide economy passengers with more space on stages of up to 17 hours, but neither carrier has plans to bring the product to Europe. SIA claims there’s “no demand” for premium economy on other routes, which seems slightly odd given the carrier is the main player on the kangaroo route between Europe and Australia, where flight times exceed 24 hours.
United takes a different tack. Its premium economy is just a separate 60 to 80-seater zone of economy class with access available to passengers paying a higher fare or who are FFP members.
So is the future for premium economy assured? Not necessarily. Firstly, the UK government does passengers no favours by taxing premium economy at the same rate as first or business class (APD is £80, compared with £40 for long-haul economy). Secondly, the cost itself can be a drawback. When premium economy was launched, heavily discounted business class tickets were rare. Today the market is awash with them (provided you choose an indirect airline) and discounted business class can cost little more than premium economy.
Another threat comes from the all-business carriers plying the Atlantic. Silverjet’s cheaper rates from Luton equate to premium economy prices out of Heathrow. Unlike regular economy class there are big variations between the airlines’ product. Not only do these vary from airline to airline, but also from route to route, as space limitations may prevent, say, separate check-in being offered at every airport. If you want to fly the best product you must carefully check what’s available.
Generally though, you’ll sit eight-across (2-4-2) on a B747 as against 10-across (3-4-3) in economy. Legroom will be roughly 38 or 40 inches as opposed to 31, and the seats will be two inches wider with steeper recline. Catering will be the same or slightly better than economy and you may get an improved choice of drinks. You should get priority boarding too.
One major difference between JAL/ANA and the others is that the two Japanese carriers are the first to grant all passengers access to their business class lounges. (Other carriers do say, though, that FFP members can use their tier status to enter lounges.) But again this varies depending on the airport, so if in doubt, ask.
For more information visit jal.com, ba.com, qantas.com, virgin-atlantic.com, flybmi.com, airnewzealand.com, singaporeair.com.
