Airlines are expanding their premium offerings, from luxury seats and Michelin-starred chefs to upgraded airport lounges, as they bet on growing demand for more comfortable and personalised travel experiences. The strategy could further reduce the share of economy-class seats on many flights, with airlines anticipating that as much as 70% of passengers could eventually opt for enhanced seating options or travel in business and first class, according to news agency AFP. The shift comes as airlines contend with significantly higher jet fuel costs linked to the Iran war, making premium services an increasingly important source of revenue. Business-class seats can occupy the floor space of up to four economy seats but may be priced five or six times higher, said Volodymyr Bilotka, a professor at Purdue University specialising in aviation economics. "Airlines have traditionally been investing quite a lot into the premium offerings because the profit margins are significantly higher," Bilotka told AFP.
Premium travel boosts airline revenues
American Airlines reported an 18.5% year-on-year increase in premium revenue in its most recent quarter, outperforming the growth in its main cabin revenue by four percentage points. "Premium products generate roughly half of the company's ticket revenue on approximately 30 percent of seats today," the airline said. Airlines are also expanding options within economy class, allowing passengers to pay extra for greater comfort and convenience. Customers can now spend as much as $200 for additional legroom or seats near the front of the aircraft, which allow them to disembark earlier. United Airlines announced in July that it would introduce a new Economy Plus option allowing passengers to avoid having someone seated in the middle seat. The service is expected to begin on select flights towards the end of 2026. JetBlue announced BlueFirst, a new first-class service on domestic flights, in September. "Customers are increasingly looking for more premium experiences," JetBlue CEO Joanna Geraghty said.
Premium seat capacity expands
The growth in premium travel has also been reflected in airline capacity. The number of premium seats on US flights has increased 33% since 2020, more than twice the growth in mainline seats, according to travel news website Skift. United Airlines said that it had more than doubled its premium-seat capacity between 2015 and 2026 and planned to introduce additional options, including seats offering more elbow room. Delta Air Lines has also invested in its Delta One service, upgrading its food and wine offerings and introducing larger entertainment screens. Its menu includes dishes such as a Wagyu burger. The airline has partnered with Simon Hulstone, chef of a Michelin-starred restaurant in Britain, and award-winning sommelier Andrea Robinson to develop its offerings. The service is planned for new Airbus A350 aircraft, which will have around 150 premium seats and 161 economy seats. "Twenty years ago, 90 percent of the seats were main cabin," said Ekrem Dimbiloglu, Delta's managing director for onboard strategy and experience. He added that premium seats could soon account for as much as 70% of capacity on some Delta flights. No major airline has yet introduced a service entirely without economy-class seats. However, British Airways announced in October that the upper deck of its two-tier A380 aircraft would be devoted entirely to premium seating. Consultancy Cirium estimates that premium seats accounted for 19% of the total capacity among 42 airlines belonging to the three major global airline alliances — SkyTeam, Oneworld and Star Alliance — as well as Middle Eastern carriers. The share stood at 17.1% in 2019.
Airlines upgrade airport experience
The push towards premium travel extends beyond aircraft cabins. Airlines are offering passengers more meal choices before boarding and free Wi-Fi, while investing in new and upgraded airport lounges. Southwest Airlines, which was once known as a discount carrier, is also among the airlines that have announced lounge improvements. The growing focus on passengers willing to pay more for premium amenities could create an opportunity for discount airlines to attract travellers seeking lower fares. However, higher fuel costs have added to the challenges facing the entire aviation industry.
