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Airlines

Middle class comfort

Premium economy class seats are a relatively new way of improving the passenger experience on long haul aircraft. Mario Pierobon reports
 

Rodolfo Baldascino, Marketing and Sales Manager at aircraft seat manufacturer Geven, says the premium economy class is ascendant within the industry: “This intermediate class between business and economy plays a positive role when installed in aircraft cabins and it is ever more being considered and required by airlines to better deploy their revenue management policies and strategies… Passengers are now familiar with the premium economy class and systematically seek for affordable fares in this class, mainly as a good alternative to business class full fares. More legroom is the main selling point of the premium economy class, together with a better inflight service and a dedicated and faster platform for booking, boarding etc. We see a prospectively growing demand for premium economy class seats in the medium and long term on board long-range aircraft, especially those serving Europe and the Americas.”


Seat manufacturer Recaro also believes that there is definitely a positive trend. “The premium economy class continues to gain market popularity and attract interest,” says Mark Hiller, Chief Executive Officer and Shareholder of Recaro Aircraft Seating. “As a pioneer, we started developing and offering targeted solutions about 15 years ago. The demand in this segment is increasing significantly.”


Nina Schulz, Head of Product Sales Aircraft Modification at Lufthansa Technik is similarly ebullient: “The quality, appearance and passenger experience of the state-of-the-art premium economy seats increased greatly during the last several years. Whereas in the past premium economy seats and classes were mainly characterised by a larger seat pitch – but using the same seats as those installed in economy class or very similar ones – modern premium economy classes developed into a real new product… We see airlines implementing a premium economy for the first time, as well as airlines upgrading their already existing premium economy class with a brand new seat, together with an improved service concept.”


WHY PREMIUM ECONOMY


There are specific reasons why a passenger elects to purchase a premium economy class seat, and these are primarily to do with the comfort requirements of passengers who are unwilling to pay for a business class fare. The installation of a premium economy class seat however, may carry the risk of business class passengers possibly downgrading to premium economy class, so losing the airlines a revenue opportunity.


“Passengers want to use the time they spend on the aircraft in a meaningful way and arrive at their destination feeling relaxed. But even if somebody is likely to spend more money for enhanced comfort, not everybody can afford business class travel,” says Hiller. “The premium economy class product is already established. Now it is more important for airlines to stay competitive and to offer solutions to address every need. Middle East airlines also tend to offer premium economy. The risk of not offering a premium economy class is considerably greater than that of passengers downgrading from business to premium economy class.”


Baldascino concurs: “There is a downgrading risk, but only for business class passengers who are price-sensitive – those passengers who decide to fly business class only if they find a suitable fare and otherwise fly economy. Indeed, in most of cases without a premium economy class an airline experiences a low load factor in business class and overbooking economy as result of potential business class passengers downgrading to economy, because they have no intermediate choice. This situation results in jeopardising the overall yield of a flight… Conversely, with a premium economy class the airline is in some way able to retain some of the yield of passengers downgrading from business to premium economy, and no longer directly to economy. Usually however, premium economy is considered more as possible upgrade from economy class passengers. Traditional business class passenger paying full fare or travelling for pure business reasons would not move voluntarily to premium economy unless obliged to do so by their companies for budget limitation reasons; we see this as potential risk in the long term when the premium economy class will be more common among most of the airlines.” >>

 


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