Carriers are ditching first-class cabins as business class becomes plusher
The distance between the back and the middle of a plane is growing ever wider
By B.R.
THERE is a common lament that the distance between the front and the back of a passenger aircraft is growing ever wider, metaphorically speaking. That is true, but requires qualification. For the most part, the expanding chasm is, in fact, between the back and the middle of a plane.
It is an incontrovertible truth that economy-class passengers will now put up with nearly any level of discomfort in return for a cheap fare. So airlines have merrily shrunk seat pitches and withdrawn perks and still managed to fill their flights. But business-class passengers are more discerning. They are higher margin and usually where an airline will make its money, at least on longer-haul flights. So they must be wooed by ever-fancier seats, posh food and plush lounges.
A few years ago, a flat-bed seat in business class would have been considered opulent. No longer. Today they are considered standard. So while the back of the plane is engaged in a race to the bottom, the middle section is moving rapidly in the other direction. Here, according to Stephen Shaw, author of an airline-marketing textbook, carriers are battling in a never-ending and largely fruitless quest for competitive advantage. Mr Shaw writes:
One airline may establish such an advantage but this does not turn out to be sustainable. The very fact that customers like its new cabin configuration forces its rivals to respond with something equally or even more appealing in order to protect their market share. The end result of a round of competitive innovation in seating standards is that market share remains more or less the same, but all the airlines which have taken part in it have significantly higher unit costs.
But all of this pampering of the middle has had a knock-on effect. Why would rich passengers pay extra for first class when business class is now so exclusive? The simple answer is that fewer are now prepared to. And so airlines are beginning to ditch their poshest cabins.
Amid the fanfare that sounded when United Airlines unveiled its new international business-class cabins last week (pictured above), was a quieter announcement that the operator would be phasing out first class. It is not alone. Other carriers, including British Airways, Air Canada and Delta, have also decided that on some routes business class is now sufficient for the needs of its premium passengers.
Some airlines believe that they can maintain the differentiation between the front, middle and back by making first class even more ludicrously posh. Witness Etihad’s three-room suites, with a bedroom, lounge and bathroom, that can be found at the front of its A380s. The Abu Dhabi-based flyer may or may not make much money on the product, it is tight-lipped on that, but the truth is that, at a cost of perhaps $20,000—sometimes more—for a trip it is just as handy as a way of signalling that it is a premium brand. Other carriers with tighter budgets won't bother.
In any case, they still have some room to grow the disparity between the haves and have-nots. When one sociologist calculated planes’ GINI coefficient, a statistical tool for measuring the distribution of income, she found that they are a veritable socialist utopia compared with America as a whole. Sadly for those at the back, carriers, no doubt, are trying to change that.
