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Short Haul Premium Travel - Business as Usual?

Richard Quest, CNN presenter, argues that airlines need to innovate if they are to attract the short-haul business traveler

It doesn’t matter whether it’s a nifty nip across the channel from London to Nice, a flight to Frankfurt or a run down to Rome; there is something pleasing about sitting “at the front” (ATF).

But, as business travelers know only too well, opportunities for short-haul business travel are getting fewer and further apart. And privately, European airlines accept that the days of the short-haul business class cabin are numbered.

Today, most companies have strict rules preventing all but the most senior executives from booking short-haul flights in business or first class. Those who knowingly and willingly pay the premium price are rare animals indeed.

As I board and walk to the back of the plane, I mutter under my breath that those passengers probably have more money than sense—for paying exorbitant prices for a shoddy meal and a seat ATF. Yet this sour mood hides something deeper: it is more envy than ridicule. I covet those seats. I want to be there too. As a frequent flyer, I feel entitled to better treatment.

This is a business trip!

The reasons are practical as well as egoistic. I usually travel on more expensive, fully flexible tickets. So it is no comfort having paid a fortune to be told you are entitled to nothing extra other than the right to change that ticket (which may still include a fee). And it adds insult to injury to find yourself squeezed into a seat next to a gap year backpacker wearing flip-flops who has paid a fraction of your fare.

This is the important point: we are business travelers going about business. We have probably got up ridiculously early and are about to do a day’s work (or have already done one). We are in suits, shirts and ties. We are in work mode.

The time in the air might be the only time that day we have to ourselves. Being stuck in the middle of a school party or a group of holidaymakers only makes the whole trip more trying. This might be the only chance to rest, read, prepare: an oasis of calm before the storm, or the recovery after it. And never forget this may be the second or third flight of the day. This is why we prize the front cabin. It is space to sit, slurp, study or snooze.

Some reading this will think “what a snob” but others will say, “that’s me, that’s my world and that’s why I want to be at the front.”

A Numbers Game?

From an airline perspective there are practical reasons why these front cabins have to remain. Full service carriers need a premium product for first and business passengers who transfer from long-haul connections. But that alone is not enough of a reason to keep them. After all, if numbers were any indication, the front cabin should have been abandoned long ago. Airlines keep them because they still hope to wring extra revenue out of the seats for yield management.

But nowadays airlines have to be inventive to squeeze cash out of the rest of us. Enhancing the yield and stretching what is possible is the name of the game, not simply raising prices (which they can’t).

Some have experimented with adding a small supplement to the flexible economy fare, enabling passengers to sit ATF. But companies grew wise to this trick and often ban the extra payments.

Other airlines, such as bmi, have taken the next logical step. They got rid of European business class and now give the space and perks to those who pay the fully flexible economy ticket. The airline is capitalizing on the fact that we are required to buy changeable tickets. It makes sense; after all, if I have to buy an expensive economy ticket I would rather travel with an airline that gives me something extra for my trouble.

As low cost carriers fly more euro-business routes at cheaper prices, there is neither the demand nor the economic necessity for the old ways. Passengers may like perks but they aren’t prepared to pay the full whack for them.

There is huge scope for some ingenuity here. Frequent flyers could subscribe to a business club that entitles them to extra perks even though the plane is all economy.

Ultimately, the airline which manages to combine status while still keeping the price under control is the one that will get the business. How do I know that? Because I will fly them!

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