Delta to Stop Giving Away First-Class Seats
Jennifer Billock March 08, 2016
Loyalty program members with Delta will soon have to start paying for upgrades to first class.
Members of Delta Air Lines’ loyalty program were dealt a blow recently when the company decided it will stop offering its members free upgrades to first class. Instead, the airline plans to sell these upgrades to anyone who wants them. While it may be a letdown for loyalty members and frequent flyers, it’s good news for everyone else because the change is expected to drive down the cost of seats in the first class cabin.
“We want people to be able to use those miles not to fly for free but to control your experience,” Glen Hauenstein, Delta’s incoming president, told Business Standard. Delta noted that currently only 57 percent of the first and business class seats are sold — under the new program, that figure is expected to rise to 70 percent by 2018.
“Historically, the domestic first-class cabin was a loss-leader,” Hauenstein said. Most of the premium seats that went unsold on domestic flights were assigned at the gate, “and there was no real compensation to the airline.”
This initiative is the latest in Delta’s journey to regain strong economic footing while hoping for consistent profits. But the hidden cost is further alienation of the airline’s SkyMiles frequent flyer program members who may already be upset over the switch to dynamic pricing (meaning the points needed to get an award seat constantly changes) and changes to the way travelers accumulate points.
[Photo: Delta Air Lines]
Why is this article even allowed to be publish on FT? It's misleading and gives FT a bad name.
The vast majority of issued miles are credit card, dining or shopping portal miles (or any other way besides actually flying!). Those companies purchased the miles likely at a penny a pop, more or less. So, using miles to upgrade is in fact making delta money. Or at the very least its holding up its end of the bargain for these miles that were sold and then "earned"
Okay, the thing that really baffles me is that they are still trying to get 80%+ paid F, but clearly can't. So what do they do? Bump up the stats on paper by "selling" the seat as an upgrade with miles? How is that "paid" to them? I'm not an economist but I do understand the certain amount of liability of someone with a stockpile of miles. But how does using miles to upgrade a paid Y to an F seat count as "paid F"? I don't get it. They make no actual additional revenue, they just get a few thousand miles from someone.
Misleading article and clickbait. Delta is NOT eliminating the medallion upgrade program. There is nothing new here... they've stated multiple tims that their goal is to increase the percentage of 'sold' first class seats. While that means less complimentary upgrades, they are not being eliminated at this time.
ioto1902, what exactly is the value? Are you referring to the sticky seat that I sat in with the used Kleenex in the seat pocket and the complimentary bruised banana that I received as a snack?