FWAAA

As I've posted previously, it doesn't matter whether those corporate customers will pay more for true lie-flat seats. What matters is whether CO can sell more of them at the asking price than it does now for the current BF seats. And other posters above have picked up on this distinction.

If true lie-flat seats means that CO sells fewer of them at discount advance purchase fares and moves fewer coach fares into them as upgrades, then reducing the number of BF seats to accomodate true lie-flat seats could be a financial win for CO.

Given the dismal new AA seats and the decent looking lie-flat seats UA is introducing, I assume that CO will go with true lie-flat seats and will sell more of them (a higher percentage of them) at whatever the going rate might be.

elitetraveler

I was at a Leading Hotels of the World Marketing Directors Conference a couple years ago and there was a panel of Corporate Travel Managers - one from a major global luxury company, one from a Wall Street behemoth and one from a Fortune 100 typical cost cutting, lay off 5,000 folks at a time type company.

They all talked about how they wouldn't pay more and would downgraded their travelers to four star hotels (it was at a time hotel rates were increasing quite strongly in key markets).

The corporate travel manager from the financial company had the audacity to say their CEO never flew First Class - also, no car service. Now having been to their office, their is always a two-deep line up of car service waiting for executives of the company. They also happen to operate two or three private jets, so perhaps she was right the CEO never flies coach. I was on a CX JFK-HKG flight a couple years ago, and three gents from this company were in the company with me, so I didn't really believe much of what this lady said.

The only one of the three who had any credibility was the gentleman from the luxury company who said brand presidents were expected to live the lifestyle the brands represent.

I think if this is what CO is saying, they probably are going to use "we asked our customers and they didn't want it excuse." CO execs are too smart to know that corporate travel managers (who are judged on saving money) are never going to say they are going to pay more for anything.

It sounds like CO has made a decision to go with the ski slopes and is starting to posture that "customers said they wouldn't pay for it."

Billiken

I want that job. ^


Please pass the corporate cool-aid.

cerealmarketer

Yes, his key phrase was "we don't want to operate a two class product." I hope it doesn't mean a step down for BF amenities/price but that is one option in the constraint of offering "something between BF and coach with only 2 classes of service."

But that seems a long shot.

If I remember correctly NW is also considering a premium economy section for its 787 although remember it sounding like a 'lite' premium economy section for elites.

cova

CO already has the EP mechanism - called Elite seating in its seatmaps. Now those seats are restricted for all but Y fare and Elites. They are blocked until 24 hours before departure.

E+ could be simply more leg room with those seats (just like UA) and then just do not unblock them at the 24 hour mark. On some aircraft - the seats are already different with the power ports. So CO already has 3 class of service - just no better seat pitch in that middle class.

bernardd

Seat pitch coupled with the need to pay high prices for flexible tickets wouldn't be enough to get me to even consider spending my TATL dollars with CO instead of BA. YMMV.

Lemurs

At my company (Microsoft) we use AmEx for booking and the rules are enforced across the board. No executives get First Class for domestic travel, and you can only buy J class for Int'l flights over 6 hours.

Now the thing to keep in mind is, the policy is for reimbursed travel only. You can bet Bill Gates does not fly commercial aviation very often, and never sits in Y when he does. He simply doesn't get to have Microsoft pay him back for those trips. He pays them out of his own pocket. Same with Ballmer and our other bigwigs.

It would not surprise me if that is what happened with a lot of other executive as well. When you're compensated like a king, you can afford to drop money on this stuff instead of taking out of shareholder's pockets.

elitetraveler

Unless you have first hand knowledge that the rules are enforced across the board, you can color me skeptical that top Microsoft officials follow the company wide travel policy. There are numerous examples I know of of C-Level executives at "all for one and one for all" policy companies that book hotels out of program and whose personal assistants just make reservations for air and hotel directly with the supplier. One corporate travel manager told me once that top executives at most companies are allowed to have their assistants book with suppliers directly "to ensure they have the control they need to do their jobs properly." I am not sure what that means, but I think it means that and EVP, Vice Chairman, COO, etc. at a big company is powerful enough to do what they want and not have the travel manager say boo

Lemurs

I don't know across the board, but I do know a few. Also, I was only speaking specifically about airfares. Microsoft is generous with Hotels/cabs/food, so there's no reason to "bend" rules there unless you're talking the 6+ star hotels. For flying though, they pay out of pocket if they go outside the rules without reason. Note that Ballmer and Gates fly private planes most of the time anyway, which Microsoft does not own or operate. They both manage that on their own.

At the mid-level there can definitely be some exceptions and abuse, but audits can and do come down. I've bought domestic First for sales calls in the past because that's the only seat and the meeting is the next day, no questions asked.

My point wasn't to say that you can't mess with the system, but there is definitely no systematic set of perks given to our top management tier. Despite what people think, Microsoft has a very open, very questioning corporate culure that our executives are expected to be a visible part of. It would not go down well here if they were seen to be openly abusing their positions.

channa

There is a big difference between a seat block and a class of service.

IAH Oil Man

Did they say what they would replace the RJ's with? Prop planes? 787s?

elitetraveler

I dont doubt you, I think the operative word is "seen." Most of the rule bending I believe is covert to the normal rank and file in big companies.

cruisr

I could speak for EWR-PIT. It use to be an RJ and now it is a Dash8-400.

aviators99

I hope you're right.

redreusam

Heaven (almost) would be PE for int'l and transcons - that would really close the deal for CO regarding my airline choices.