Dismal science of airline travel

Airlines are not a public service, unless you fly a lot on C-17s and C-130s. Like many of the rest of us, they’re in the game to make money or at least not to lose so much that the stock price tanks and the CEO gets fired.

With that in mind, here’s an excerpt from a piece the New York Times ran week before last on the economics of business class travel:

Travelers in business and first class may represent 10 to 15 percent of long-haul seats globally, but they account for up to half of the revenue of airlines like Lufthansa or British Airways, says Samuel Engel, a vice president at ICF SH&E, an aviation consulting firm. … But there is only so much space inside a plane. As the more lucrative seats expand, the coach section often contracts, with more seats jammed into the same cabin space and more discomfort for coach passengers.

You should be able to read the handwriting on this bulkhead. I made my prediction a while back in “Newly merged airline ends coach service“, and we may get there sooner than I thought. If the economics swing just a little bit, coach will become a loss leader, sort of, and the bean counters will start pushing to end it:

Generally speaking, a first-class seat takes up the space of six to eight coach seats and a business-class seat takes up about four coach seats. The same is roughly true for ticket prices: first class is generally more than twice the price of business; business class is usually four times the price of coach.

As a bonus, they can get rid of all those pesky, whining, bargain-obsessed coach passengers.

Can you make money off coach? I don’t know. Maybe relaunch Sir Freddie Laker’s original Skytrain concept with used widebodies in an all-coach configuration flying only major city pairs? The rest of the country can go Greyhound. Once the majors exit the coach business, they won’t be as motivated to sabotage a discount start-up as they were back during the 1970s. May even be glad to have someone take it off their hands.

Leave a Reply

Please log in using one of these methods to post your comment:

WordPress.com Logo

You are commenting using your WordPress.com account. Log Out / Change )

Twitter picture

You are commenting using your Twitter account. Log Out / Change )

Facebook photo

You are commenting using your Facebook account. Log Out / Change )

Google+ photo

You are commenting using your Google+ account. Log Out / Change )

Connecting to %s