Economy class worsens and I’m part of the problem

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There is outrage once again. Passengers are expressing their ire on social media as airlines announce downgrades to their product offerings. Undoubtedly bad for travelers from a comfort perspective, the changes probably do not provide much relief from a fare perspective either. Perhaps the only thing surprising about the changes is the timing of them; likely too late for airline investors to truly be sated and still too soon for the passengers who would prefer to see status quo maintained.

Cathay Pacific’s Squeeze

The financials for Cathay Pacific have been in the doldrums for a few years now. The carrier is accepting delivery of new aircraft (A350s) and retiring the oldest (747-400s) in its fleet but the 777s are a challenge. With a 9-abreast economy class layout, the seating density is simply too low for Cathay to compete as the industry pushes full speed ahead to configure the type with 10-abreast seating. 

In an interview with the South China Morning Post, Cathay CEO Ivan Chu Kwow-leung notes that limited slot capacity at Hong Kong International Airport necessitates the densification move, allowing the carrier to “generate more seats per slot, that’s the key thing”. This sort of scenario should, in theory, be great news for Airbus. The company has spent much of the past decade challenging the industry to consider slot limitations at popular and congested airports when assessing their fleet needs, and has presented the double-decker A380 as enabling an increase in seats per slot. But Cathay ordered the A350, not the A380.

The A350–900 variant deliveries to Cathay have started with 280 seats on board, comparable to the 777 in 9-abreast layout. The A350–1000s headed for Cathay will have more seats but neither variant dramatically increases seats per slot the way an A380 would. Given Cathay’s single hub operation and connecting passenger flow, the A380 could make sense for the company and keep passengers comfortable. Alas, that seems unlikely with 40-plus A350s yet to be delivered to Cathay.

air new zealand economy skycouch 777-300er 77w

For perspective, this is what Air New Zealand’s 10-abreast 777-300ER looks like. Image: Air New Zealand

British Airways’ Cuppa’ Charges

The draw of legacy carriers in Europe compared to the LCC competition has, at least in recent memory, been about service and soft product. Sure, Eurobiz doesn’t offer more legroom for business class passengers but you get a nice meal, right? For economy passengers in seats with comparable legroom, the rules about cabin baggage are reasonable, and an onboard snack was part of the offering. Not so anymore on British Airways. The carrier has shifted to a buy-on-board program for shorthaul economy. Charging for food is one thing, but charging for drinks – including the treasured cuppa’ – is a step too far in my view.

British Airways is clearly not seeing booking loyalty from offering complimentary onboard food on shorthaul flights, particularly with the competition it faces from easyJet and Ryanair. But the way the company is handling the change is certainly awful.

Unlike Cathay Pacific, which was blunt in admitting that its offering was uncompetitive from a revenue potential perspective, British Airways is holding firm with the claim that passengers were demanding to pay for food on board. The corporate message that these are positive changes rather than a bid by BA to seek a more favorable bottom line is disheartening.

Legacy carriers’ adoption of buy-on-board (BOB) programs has already played out in the United States. Six years ago, Continental Airlines introduced BOB and ceased its “meals at mealtimes” campaign, later admitting that free meals were a $35 million annual item and “that economy-class customers have not selected airlines based on free meals”.

Of course, the cyclical nature of the industry – and record profits among US carriers driven by lower fuel prices – have seen free snacks return in the US market with much fanfare and marketing hype. Delta has even brought back free meals for its longest domestic flights to Hawaii. But the hold-outs remain with low-cost carriers Spirit, Frontier and Allegiant charging for everything on board, much the way the European LCCs, and now British Airways, do.

Maybe it is my fault

But here’s the hard part – I’m part of the problem. I’m incredibly price-sensitive in my purchasing decisions. I recently flew easyJet and was quite happy to pay a few quid on board for a hot combo meal because I had that option and the overall price was right.

PDT coach modobag-300x300-v2I’m the person who will choose to save $10 on a ticket rather than get the free meal on board BA for a short-hop flight. I can even handle not getting a free soda on board; typically I don’t drink one anyways as I’ve got a water bottle with me.

Moreover, I hate 10-abreast on the 777 but if the price is right I know I’ll buy that seat again to get where I’m going. I know me.

Part of me wants to be mad at the cuts as I know they’re bad news overall. But I also know that when the price is right I’m going to buy the competing product almost every time, mostly because I’ve already done exactly that. And I’m not going to change. That the airlines are finally catching up with my behavior is disappointing, I suppose, but I am getting exactly what I’ve asked for and not an inkling more.

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21 Comments

  1. Robert Dotson

    I guess I am one of the few who will pay a bit more for OW elite privileges. Been in every Schengen nation except Slovenia and have never flown a true LCC…Air Berlin would be the closest and I don’t see it as a purist LCC.

    • Seth Miller

      How much will you pay and why? Also, how far out of your way will you travel? Especially with AirBerlin cutting back severely things will be dire for oneworld members on the Continent in the near future.

      But I can buy priority boarding and the extra leg room seat on Ryanair for far less than a legacy ticket will cost, with the bonus of actually getting more legroom, something the legacy options do not offer. I could even buy in to a lounge at the airport were that of value to me, though it rarely is.

    • Robert Dotson

      On a short haul I think nothing about $50 or under. Above that I start thinking. Of course many of my tickets I buy as a single journey because I usually fly premium and I typically can fly to the final destination for less than I can pay APD in London and then add an LCC ticket onward. Because all my travel is leisure I don’t mind several hundred miles out of the way.

    • Seth Miller

      Up to $50 extra I might show some loyalty, but that’s usually towards comfort, not towards a particular carrier. It is why I’ll pay a little more to fly Ryanair in some cases because they actually have seats with more legroom. Ditto for flying on JetBlue where I can and prices are close because more space for me (plus free, functional wifi). But even flying “premium cabin” on most of those flights isn’t particularly premium to me. And I guess I enjoy myself more with a proper drink at the destination than I do on the plane.

    • Robert Dotson

      I hear you…almost without fail BA and IB give me exit row seating and I value that for sure…and for BA’s many weaknesses, I always count a nice pour of JW Blue or Glenlivet 18 proper for my lowly palette. I would certainly be open to experiment with Norwegian if they ever expand to Dallas.

  2. Philippe

    If Juan Trippe was still alive, should he be the witness of what became his ”mass air transport tourism” vision, I think he would die a second time around!!! Do your home work right; the source of the problem is the fare deregulation of the 80’s. The airline industry competes in a nonsense Y class fare structure. The slot issue is a totally different problem.

  3. George Michaelson

    Its dropped down my preference rankings markedly. But that said, seat availability for FF redemption may now become simpler, with less competition.

  4. Atul Jain

    I absolutely like what BA and Cathay pacific are doing. After all that’s how they can save themselves financially and ultimately that is what the market forces are dictating them to do. Bravo…

  5. MR ROB HENSHALL

    We always went out of our to fly BA, both short haul and long haul. With their changes to buy on board, even for a bottle of water is ridiculous. Their fares aren’t reflecting the changes to this.

    On their website the lowest price you saw included all the taxes and applicable fuel surcharges etc, including 23kg of hold baggage. Now the first price you see is for the same charges but cabin baggage. If you want your 23kgs you pay the second price which is GBP18. 00 more. This is for domestic and all European destinations.

    International flights of 7 hours and under have had the second meal /snack removed. At the moment they still have a complimentary bar service and 23kgs of hold baggage. Norwegian from Gatwick is expanding to U.S and Canadian destinations. Also at Gatwick there are 3 airlines now flying to several Canadian cities. Air Canada Rouge, Air Transat and Westjet. I’ve flown Air Transat many times, Admittedly in their Club class cabin but I have flown economy too. In the price is a choice of 2 different 3 course meals with a complimentary alcoholic drink, any other drinks you pay for. You also get 23kgs of hold baggage and a light snack an hour prior to landing.

    Air Transat came up with a fare of GBP323.70 return for March 1st to the 15th. I then did the same on the BA website and the cheapest flight was GBP444.17 these flights were from Gatwick to Toronto.

    BA say the changes are necessary to take on the likes of Easyjet and Ryanair, that’s all well and good, but as previously said BA’s fares aren’t reflecting the changes being made.

    IAG which owns BA, Iberia, Aer lingua and Vueling are bringing their on board food and bar service in line with each other.

    As much as I like BA, I’m very disappointed with their new changes in the attitude of cramming in as many seats as possible on their A320s, 787s and 777s. The change to buy on board for all short haul flights and stopping the extra snack service on flights of 7 hours or less. If you want to take on the LCC then your economy fares must reflect this.

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