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Airline battle for premium economy heats up


Delta announced that in addition to adding flat-bed seats in BusinessElite to its international fleet, it will also upgrade a portion of the economy section to Economy Comfort. With that February 7 announcement, Delta joins a growing list of airlines with some form of “enhanced” economy service.

Closer product alignment with alliance partners

The airline announced it will complete the reconfiguration on its long-haul fleet by summer 2011. The new section will consist of the first few rows in economy on each aircraft and will offer additional legroom as well as seats with 50% greater recline. Delta’s plan will mirror SkyTeam partner KLM, also with an economy section with more legroom but the same number of seats abreast. Economy comfort will be less of a unique cabin than is the case with Air France and Alitalia, both offering an enhanced economy product with fewer seats per row.

The seats will be offered at no charge to those paying a full Y fare as well as to members of the top two tiers of its SkyMiles programme. Others will be able to upgrade to the seats with an additional one-way charge ranging from USD80-160 through reservations, at or at airport kiosks.

Passengers seated in the section will also receive priority boarding and free spirits in addition to the beer and wine offered to all economy-class international passengers. In-seat power will also be available on aircraft equipped with newer IFE.

A direct challenge to UA’s Economy Plus

The new section is a direct challenge to United’s established Economy Plus section, with its additional legroom. Unlike United, the Delta product is only intended for international services while Economy Plus is a feature on all UA aircraft. But United’s seats do not have extra recline nor do they include additional service benefits. When contacted, United stated a competitive response was in the making and would be announced “soon”.

Delta, which abandoned long-haul first class in the late 1990s in favor of its BusinessElite product, is the most recent to announce an “enhanced” economy offering. Since its introduction, Business class has evolved from a special cabin reserved for those paying full Y to elaborate suites that have, for many carriers, eliminated the need for First.

Delta was an early adopter of the two-class configuration but the escalating cost of C, coupled with budget cutbacks at many corporations, has put pressure on airlines to improves economy travel for those whose travel policy now prohibits Business. It is also seen as a viable product for leisure travelers who wish to have more comfort that economy but are unwilling to pay the much higher C fares.

Enhanced Economy has no clear definition

Unlike business, which is a similar product across most carriers, the new enhanced economy offers encompass a wide range of alternatives. With the addition of DL, 19 international airlines currently offer such products on some or all long-haul aircraft. They range from modified versions of existing configurations such as those offered by DL, UA and KL, to the completely redefined cabins seen on carriers such as Air New Zealand and Turkish. Passengers traveling on those airlines also enjoy upgraded catering and amenities as well, with the products priced at a point between normal Y and C rather than just requiring a surcharge.

Many industry observers expect that as business becomes the “new first”, there will be more carriers offering an intermediate product that bridges the chasm between Y and C; repeating the cycle that led to the creation of Business class some two decades ago.

Others likely to follow

Following the anticipated response from United to Delta’s challenge, we can expect that American, and perhaps US Airways, will feel compelled to make similar concessions to stay competitive in the corporate market. Following a decade of premier one-upmanship, the new battle for hearts, minds and passengers appears to be moving to the back of the bus.

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