Is International First Class Profitable?
Jan 24, 2014 | 9:44 am
#1
Original Poster
Join Date: Oct 2011
Location: DTW
Posts: 363
Is International First Class Profitable?
I've come to notice that only a handful of airlines offer an international first class product. Is there a reason why there's only so few? The only reason I can think of is that these aren't profitable.
Jan 24, 2014 | 11:21 am
#2
Join Date: Nov 2009
Location: Montral
Programs: Air Canada, Hyatt
Posts: 1,460
Is International First Class Profitable?
it's not very difficult to understand, when first class is 10k and business is 3,5k 9/10 you'll "settle" with business class.
plus, the evolutions and improvements in business class seating in the last 10-15 years have closed the gap significantly between F & J. these days there isn't much of a difference in terms of the actual seat or comfort offered. is the caviar and Krug really worth the extra thousands?
plus, the evolutions and improvements in business class seating in the last 10-15 years have closed the gap significantly between F & J. these days there isn't much of a difference in terms of the actual seat or comfort offered. is the caviar and Krug really worth the extra thousands?
Jan 24, 2014 | 11:39 am
#3
Join Date: Sep 2006
Posts: 526
First class seating is probably marginally less profitable than filling the same space with more business class seating. Also I doubt most first-class passengers pay full-fare, whereas business class full-fare is common especially among business travelers.
Jan 24, 2014 | 5:19 pm
#5
Used to be 'Travelergcp'
Join Date: Jul 2003
Location: New Orleans
Programs: AA Plat, Marriott Gold, Hyatt Globalist
Posts: 2,933
Over all carriers that offer it? I doubt it, since they've been systematically getting rid of F space over the years. For certain routes, you bet.
It's actually a bargain for certain high-value customers who might otherwise charter a jet for 100k USD for a long-haul trip.
It's actually a bargain for certain high-value customers who might otherwise charter a jet for 100k USD for a long-haul trip.
Jan 24, 2014 | 7:54 pm
#6
A FlyerTalk Posting Legend
Join Date: Apr 2001
Location: PSM
Posts: 69,232
But to the OP's question, the market for F is shrinking rapidly. There are very few routes/markets in which passengers will actually pay - be it full fare or contracted discounts - for first class. It is disappearing in general, though it does remain in a few niche areas.
Jan 24, 2014 | 8:59 pm
#7
Suspended
Join Date: Aug 2005
Location: BOS
Posts: 15,027
Also, First class offerings are not consistent across airlines. For instance, First class on AF might be considered equal to business on KE or SQ. While First class on EK or SQ is of a completely different order.
Jan 24, 2014 | 11:31 pm
#8
Join Date: Oct 2013
Posts: 537
Not really. Corporate contracts and such mean many are paying discounts there, too.
But to the OP's question, the market for F is shrinking rapidly. There are very few routes/markets in which passengers will actually pay - be it full fare or contracted discounts - for first class. It is disappearing in general, though it does remain in a few niche areas.
But to the OP's question, the market for F is shrinking rapidly. There are very few routes/markets in which passengers will actually pay - be it full fare or contracted discounts - for first class. It is disappearing in general, though it does remain in a few niche areas.
There are still quite a number of major international carriers (and two US ones-UA and AA) that still offer first class, it is not as niche as you claim. If those carriers found first class unprofitable, they would have eliminated it long ago (since airlines are so fanatical in controlling cost). The fact these airlines have retain it means it does make money for them. Hence it is profitable enough for them to keep it.
Jan 25, 2014 | 1:30 am
#9
Join Date: Sep 2012
Location: NW London and NW Sydney
Programs: BA Diamond, Hilton Bronze, A3 Diamond, IHG *G
Posts: 7,145
Y 1k, Y+ 1.5k, J 3k, F 5k may get more people to pay for F.
Of course if you have suites or showers in F then that takes up more space and a higher cost would be justified.
Jan 25, 2014 | 7:09 am
#11
FlyerTalk Evangelist
Join Date: Dec 2000
Location: south of WAS DC
Posts: 10,131
it's not very difficult to understand, when first class is 10k and business is 3,5k 9/10 you'll "settle" with business class.
plus, the evolutions and improvements in business class seating in the last 10-15 years have closed the gap significantly between F & J. these days there isn't much of a difference in terms of the actual seat or comfort offered. is the caviar and Krug really worth the extra thousands?
plus, the evolutions and improvements in business class seating in the last 10-15 years have closed the gap significantly between F & J. these days there isn't much of a difference in terms of the actual seat or comfort offered. is the caviar and Krug really worth the extra thousands?
the ana nrt lounge had $50 shelf wines.
i would place total value increased at around $2-300 max.
Jan 25, 2014 | 8:37 am
#12
Join Date: Sep 2006
Location: PHL
Programs: Former long-time US GP; now AA dirt
Posts: 4,904
There are still quite a number of major international carriers (and two US ones-UA and AA) that still offer first class, it is not as niche as you claim. If those carriers found first class unprofitable, they would have eliminated it long ago (since airlines are so fanatical in controlling cost). The fact these airlines have retain it means it does make money for them. Hence it is profitable enough for them to keep it.
Sometimes it takes a business quite a while to cut a money-losing product line. But by your logic, the mere fact that a product-line exists means that the product is surely profitable.
If only running a business were that easy!
BTW, I've flown UA international first class. It's a joke to call it "first class." I've had better overall experiences in J on several other airlines.
Jan 25, 2014 | 10:24 am
#13
A FlyerTalk Posting Legend
Join Date: Jul 1999
Location: Over the Bay Bridge, CA
Programs: Jumbo mas
Posts: 42,569
It might for some. Yet the "2 cabin" airlines often have a much better J product than the 3 cabin airlines. I generally want to be in the airline's front cabin. I'd rather be there at the time of booking than some illusory chance of a last minute UG to an F cabin. The airlines that have a luxurious F cabin don't generally make it something that one can easily upgrade into.
Jan 25, 2014 | 12:15 pm
#14
Join Date: Aug 2008
Location: トロント
Programs: IHG Platinum
Posts: 4,856
we flew first on UA iad-nrt-iad. no krug and no caviar. i think the meals were very close to idntidcal to biz. the wines were $25-30 shelf priced. the ua global first lounges at sfo, iad, and nrt were nice. the lounge at nrt for ana was the nicest. the beds in first were much nicer than on biz class.
the ana nrt lounge had $50 shelf wines.
i would place total value increased at around $2-300 max.
the ana nrt lounge had $50 shelf wines.
i would place total value increased at around $2-300 max.
(But as to is it worth the premium ANA charges, my answer would be no)
Jan 25, 2014 | 12:36 pm
#15
Join Date: Jun 2012
Location: East Anglia UK
Programs: BA-S UA LH-Sen KLM/AF-Plat.
Posts: 1,699
we flew first on UA iad-nrt-iad. no krug and no caviar. i think the meals were very close to idntidcal to biz. the wines were $25-30 shelf priced. the ua global first lounges at sfo, iad, and nrt were nice. the lounge at nrt for ana was the nicest. the beds in first were much nicer than on biz class.
The other thing is the cabin size, fewer pax, calmer atmosphere, more personal approach although that depends on the crew at the time. I think people who don't regularly fly might use it for that special treat, those who can afford it do it all the time. Every time I've flown trans Atlantic (maybe 3 or 4 times a year in F) the cabin's been full.
The other thing is the cabin size, fewer pax, calmer atmosphere, more personal approach although that depends on the crew at the time. I think people who don't regularly fly might use it for that special treat, those who can afford it do it all the time. Every time I've flown trans Atlantic (maybe 3 or 4 times a year in F) the cabin's been full.