Should UAL do the unthinkable with their "premium" seats?

ualdriver

Veteran
Aug 20, 2002
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I'm starting to wonder if UAL should start thinking about adding seats back to their domestic narrowbody airplanes at the expense of significantly reducing the number of first class or economy plus seats. I'm starting to wonder if the cost of providing premium seating to its domestic narrowbody customer is adding costs to the airline that domestic fares simply barely sustain, or won't sustain in the future.

With 80% average load factors the new norm, I'm wondering if we're leaving too much money on the table by taking seats out of airplanes that probably would have had butts in them had we left them in. I think that when average load factors were much lower, it probably made sense to add economy plus as the average seat removed probably had nobody sitting in it, but now I suspect that is no longer the case. Or maybe we should remove first class entirely from our domestic narrowbodies and just use a reduced number of economy plus seats as our "premium" domestic seat for the typical short haul type flight. I'd love to see how much it is really costing us (an opportunity cost if you will) by not having these extra coach seats on our airplanes, and how much of a "premium" we're really getting for guys/gals flying first class/economy plus in our typical domestic, narrowbody market.
 
I'm starting to wonder if UAL should start thinking about adding seats back to their domestic narrowbody airplanes at the expense of significantly reducing the number of first class or economy plus seats. I'm starting to wonder if the cost of providing premium seating to its domestic narrowbody customer is adding costs to the airline that domestic fares simply barely sustain, or won't sustain in the future.

With 80% average load factors the new norm, I'm wondering if we're leaving too much money on the table by taking seats out of airplanes that probably would have had butts in them had we left them in. I think that when average load factors were much lower, it probably made sense to add economy plus as the average seat removed probably had nobody sitting in it, but now I suspect that is no longer the case. Or maybe we should remove first class entirely from our domestic narrowbodies and just use a reduced number of economy plus seats as our "premium" domestic seat for the typical short haul type flight. I'd love to see how much it is really costing us (an opportunity cost if you will) by not having these extra coach seats on our airplanes, and how much of a "premium" we're really getting for guys/gals flying first class/economy plus in our typical domestic, narrowbody market.
That's one big reason AA added back the rows in their planes a few years back.
 
I'm starting to wonder if UAL should start thinking about adding seats back to their domestic narrowbody airplanes at the expense of significantly reducing the number of first class or economy plus seats. I'm starting to wonder if the cost of providing premium seating to its domestic narrowbody customer is adding costs to the airline that domestic fares simply barely sustain, or won't sustain in the future.

With 80% average load factors the new norm, I'm wondering if we're leaving too much money on the table by taking seats out of airplanes that probably would have had butts in them had we left them in. I think that when average load factors were much lower, it probably made sense to add economy plus as the average seat removed probably had nobody sitting in it, but now I suspect that is no longer the case. Or maybe we should remove first class entirely from our domestic narrowbodies and just use a reduced number of economy plus seats as our "premium" domestic seat for the typical short haul type flight. I'd love to see how much it is really costing us (an opportunity cost if you will) by not having these extra coach seats on our airplanes, and how much of a "premium" we're really getting for guys/gals flying first class/economy plus in our typical domestic, narrowbody market.

That's what Greyhound did in their 'heyday’. I see no difference as 'airlines' become the same as have the horse, boat, stagecoach, train, bus… Transportation will ‘evolve/devolve’ depending on the demand. JMHO, UA should have started the BizJet but it only included Pilots and ‘no one else’ ergo this pi..ing match. Really wouldn’t matter as the company would have taken the profits and pi..ed them away.

But you do have an unfair advantage as you have been to the BET and have participated in the ‘airline’ board game. :p

Take Care,
B) UT

Just being part of the The Ass Family... :p
 
ualdriver, F and E+ seating are what attracts the frequent flyers. As a 1K, I can tell you that I steer my business and personal flying toward United. If United were to significantly reduce E+ and F, I'd be aiming my business travel toward American, as they fly out of Reagan (closer to my house) instead of flying out of Dulles (I hate that airport). All of my coworkers feel the same way. In fact, some of them initially went with American due to the convenience of Reagan, but they quickly tired of flying on the slave 80 and returned to United with E+. We always book Y fare in my office - granted, it's government Y, but we never take a lower fare class than Y. That fare class gives a much higher yield than what you get on other fare classes.
I work with a lot of contractors who have greater flexibility in ticketing than I do (as a govt employee) and they all aim their travel toward United. They go with United due to the relative comfort and available upgrades.

If you want United to cater to the Southwest crowd, then reduce F, C and Y+. It will result in additional seats available for sale. But they will definitely be lower yield than those for business travelers. What you really need to look at is yield maximization.

And FWIW, I'm a furloughed UAL pilot who was recalled and will remain on mil leave for as long as possible. But I'll tell you straight up - if American offered a better product for frequent flyers, I'd be flying them in a heartbeat.
 
Good post ualdriver.

Keep the premium seating option. It is your value distinction from the other guys.

Don't pissoff your best customers.

(good to read you're still talking like a UA employee even though you're a private contractor)
 
Good post ualdriver.

Keep the premium seating option. It is your value distinction from the other guys.

Don't pissoff your best customers.

(good to read you're still talking like a UA employee even though you're a private contractor)
AA had the whole coach cabin as premium seating to distinguish them from the other guys. They eliminated it. They made a profit. UAL hasn't. As the OP pointed out - load factors are in the mid to high 80's - yet no profit. Surely it isn't just the folks in the back half of the cabin that is responsible for that situation.
 
If United were to significantly reduce E+ and F, I'd be aiming my business travel toward American, as they fly out of Reagan (closer to my house) instead of flying out of Dulles (I hate that airport).

Huh? UA flies to both ORD and DEN from DCA. Plus, you can earn UA miles on the hundreds of US flights (mainline and express) from DCA.
 
I'm starting to wonder if UAL should start thinking about adding seats back to their domestic narrowbody airplanes at the expense of significantly reducing the number of first class or economy plus seats. I'm starting to wonder if the cost of providing premium seating to its domestic narrowbody customer is adding costs to the airline that domestic fares simply barely sustain, or won't sustain in the future.

IMO, that would be the worst possible decision. More seats will mean yet lower fares, and UA's mainline yield already trails AA's mainline yiled by over a penny per mile. UA (as well as AA and other legacies) needs to decide to whom it will try to cater; right now, UA is trying to be all things to all people, and it ain't working.

Ted was a huge mistake. You can't just paint some airplanes and remove F from some A320s and magically begin printing money the way Southwest does. On top of that, Ted's E+ is some of the least generous among UA's airplanes - with 156 seats, that's the same as B6 before B6 removed another row and instituted E+ throughout their cabin.

With 80% average load factors the new norm, I'm wondering if we're leaving too much money on the table by taking seats out of airplanes that probably would have had butts in them had we left them in. I think that when average load factors were much lower, it probably made sense to add economy plus as the average seat removed probably had nobody sitting in it, but now I suspect that is no longer the case. Or maybe we should remove first class entirely from our domestic narrowbodies and just use a reduced number of economy plus seats as our "premium" domestic seat for the typical short haul type flight. I'd love to see how much it is really costing us (an opportunity cost if you will) by not having these extra coach seats on our airplanes, and how much of a "premium" we're really getting for guys/gals flying first class/economy plus in our typical domestic, narrowbody market.

IMO, load factors are high right now because of the huge domestic capacity surplus, which causes UA (and the other legacies) to bid down their coach fares to try to "make it up in volume." What we need is to see a couple legacies say "screw it. We're gonna make comfortable coach seating and expand F cabins in an attempt to attract higher-yielding customers. Let our dinosaur competitors remove F seats and F cabins and squeeze in a few more rows, driving down yields even further." IMO, any legacy willing to market itself like that might just beat the LCC-wannabe legacies.

KCFlyer said:
AA had the whole coach cabin as premium seating to distinguish them from the other guys. They eliminated it. They made a profit. UAL hasn't. As the OP pointed out - load factors are in the mid to high 80's - yet no profit. Surely it isn't just the folks in the back half of the cabin that is responsible for that situation.

Sorta oversimplified, if you ask me.

More Room Throughout Coach (MRTC) was announced in early 2000. By early 2001, when the transition was largely complete, the dot.com bubble had burst and AA was on track to losing money in 2001, even before September 11 happened. So in the midst of 2002-03, when every legacy was bleeding cash, AA began to re-install seats in a desperate attempt to bring in cash. Note that AA's mainline yield was greater than UA's mainline yield in 2001 - 2006, so it's hard to draw conclusions about whether MRTC helped bring in more unit revenue or whether it cost AA money by leaving people behind on popular routes.

I'm not convinced that removal of MRTC did anything to contribute to AA's recent profits. As I've posted before, it has a huge unit revenue advantage over UA and a yield premium to most legacies.

AA also has the largest narrowbody mainline F cabins - with far more F seats than UA. UA has some 8 F 319s and 737s while no AA narrowbody has fewer than 16 F seats.

Looks like more F seats = profits, right? B)

My point: MRTC never had a chance to prove whether or not it worked in a healthy airline environment. Its installation wasn't complete until right before September 11 and it was removed shortly after that.

AA really ought to experiment with an E+ regime to see if it can help further. But don't look for short-man Arpey to do it. Carty was 6'3", so no wonder he was a fan of MRTC.

On the other hand, E+ didn't keep UA out of Ch 11 and it hasn't meant big profits now that it's emerged from bankruptcy. Hard to draw any conclusions about the effectiveness of large F cabins or E+ or MRTC.
 
Sorta oversimplified, if you ask me.

More Room Throughout Coach (MRTC) was announced in early 2000. By early 2001, when the transition was largely complete, the dot.com bubble had burst and AA was on track to losing money in 2001, even before September 11 happened.

I'm not convinced that removal of MRTC did anything to contribute to AA's recent profits. As I've posted before, it has a huge unit revenue advantage over UA and a yield premium to most legacies.

Perhaps...but before MRTC, TWA had "Comfort Class" - which was pretty much where they removed a couple of rows of seats and gave the whole coach cabin more legroom. That didn't last too long either. That tells me that it didn't gain any NEW customers, and very few if any of AA's "regular" customers flocked to the other airlines when MRTC was pulled.
 
AA had the whole coach cabin as premium seating to distinguish them from the other guys. They eliminated it. They made a profit. UAL hasn't.

The whole coach cabin as premium seating is a mistake.

We are not talking about the whole cabin with UA.

Big difference.

UA's financial losses can be attributed to a whole lot more than simply removing a few premium seats.

And AA did not avoid bankruptcy just because they removed a few premium seats.

C'mon, you know better!
 
The whole coach cabin as premium seating is a mistake.

We are not talking about the whole cabin with UA.

Big difference.

UA's financial losses can be attributed to a whole lot more than simply removing a few premium seats.

And AA did not avoid bankruptcy just because they removed a few premium seats.

C'mon, you know better!
True enough...you can't make money with a whole cabin full of extra legroom. But it does make me wonder, since E+ is geared toward the "elite" members of the FF program, could it be that those elites are not bringing the revenues needed to support the perk? Or is UAL selling the remaing seats at such a loss that those "premium revenues" that warranted the privlege of an E+ seat can't cover them?
 
People just move into those seats without paying for them anyway (on UAL) when the flights aren't full. When they are full, we don't (necessarily) charge a premium for them. Full flights have to sell all the seats, with most of the flights full, premium seats don't sell at a premium, so what's the point?
 
True enough...you can't make money with a whole cabin full of extra legroom. But it does make me wonder, since E+ is geared toward the "elite" members of the FF program, could it be that those elites are not bringing the revenues needed to support the perk? Or is UAL selling the remaing seats at such a loss that those "premium revenues" that warranted the privlege of an E+ seat can't cover them?


AA took out the extra 2 lavs in the rear of the 767-300 for more seats and less leg room on all 767 and s80.
I just took them to Madrid from Miami in coach and no leg room.. it sucks for 9hours coming and going.

The E+ on Ted and UAL are sometimes always empty on some flights depending on the route. Everyone who didn't pay for the E+ seat try to scam and move up into those seats. You tell them NO and they get pissed off at you when you tell them no as a flight attendant.