Airlines Rack Up Big Margins From Premium Seat Sales
Photo Credit: Ryanair is not known as a premium airline, but it is increasing selling slightly better products to its customers, and making a big margin in the process. Pictured is a Boeing 737 aircraft. Ryanair
Skift Take
A skeptic might say airlines are doing so well selling premium seats because their standard offering is getting worse. There's some truth to that. But airlines have also gotten better at targeting passengers with the right offers for them.
We're roughly halfway through airline earnings season, and since investors don't like to hear executives complain about high fuel prices, many carriers have highlighted better news: Customers are paying big bucks for premium seats.
It's not just flat-bed business class pods. Delta Air Lines reported earlier this month that all of its premium revenues, a group that encompasses international business class, premium economy, and extra-legroom seats, increased 19 percent in the third quarter, year-over-year.
United Airlines and JetBlue Airways had similar news, which is probably no surprise, as consumers feels flush, thanks to to a strong economy, and until recently, robust public markets. In September, the last month of the third quarter, U.S. consumer sentiment topped 100 on the University of Michigan's index for the only third month since 2004.
This is not only an American phenomenon, nor simply a full-service airline development, as my colleague Patrick Whyte, Skift's Europe E
