Cathay mulls premium economy

12 Jan 2010 by Mark Caswell

Cathay Pacific is soliciting the views of its Marco Polo loyalty club members regarding a new product widely believed to be a premium economy cabin.

In an email questionnaire seen by Business Traveller, the Hong Kong-based carrier asks its members:

“With your help we can serve you better. At Cathay Pacific we care about what you think – and we listen. That’s why we would appreciate it if you would tell us more about a product offering which Cathay Pacific is evaluating.”  An accompanying picture shows an illustration of another airline’s premium economy seating.

This move comes as little surprise at a time when company travel budgets are under pressure and executives are looking to more affordable products in order to cut costs. 

Last year, CEO Tony Tyler admitted in the industry magazine Airliner World that his carrier, “had looked at introducing premium economy a number of times but we could not get the sums to add up.”

But matters are changing rapidly in today’s economic climate and more recently a spokeswoman told Business Traveller that Cathay Pacific has begun conducting a top-down analysis of its business. “We are looking at every aspect of our operation. Premium economy is one of the many options that we are studying although no decision has yet been made.”

Although premium economy is relatively unknown in Asia (only Taiwan’s Eva Air and Japan’s JAL and ANA offer the product), Cathay Pacific is facing fierce competition on European routes from carriers who already offer (or will soon be offering) the product.

On its main route to London Heathrow it competes with no fewer than four premium economy airlines (British Airways, Virgin Atlantic, Qantas and Air New Zealand). In the case of Paris CDG it competes with Air France (which is busy installing premium economy) while at Amsterdam it faces KLM (which has recently launched a quasi-premium economy product called Economy Comfort).

If Cathay Pacific were to opt for premium economy the move could not happen overnight. Expect a delay of at least one or two years, with premium economy installed on planes rostered for long distance rather than regional routes.


Report by Alex McWhirter

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