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Feature Story

Charles Stewart in office setting.

Boeing photo by Chuck L. Taylor

Twin-aisle planes like the 787 are the most flexible in accommodating "premium economy" class seating, says Boeing cabin expert Kent Craver.

Putting a premium on economy

By Chuck Taylor

With the global economic downturn contributing to changes in air travel, a Boeing passenger specialist thinks it's a good time to rearrange the seats.

"Airlines are seeing pressure from businesses and corporations saying, 'You can't fly business class anymore, you have to fly economy,'" said Kent Craver, who previously was in charge of cabin amenities for a major airline and now provides insight to Boeing as an expert in passenger satisfaction and revenue.

Even as the economy shows signs of recovery, business travelers, a major source of revenue for airlines, are increasingly traveling in economy seats, according to data compiled by the International Air Transport Association. But those travelers surely would prefer a more restful experience on long-haul flights than economy seating and service can provide.

The solution, Craver says, is an emerging class of service called "premium economy," priced somewhere between business class and regular economy. "We think it's the best revenue opportunity for airlines today."


Boeing photo

Standardized floor tracks in the new Boeing 787 Dreamliner make it easy to change the configuration of seating.

Boeing works with airlines to help them introduce premium economy, which involves reconfiguring seating arrangements. Meanwhile, the new 787 Dreamliner was designed to make it easier for airlines to make fast adjustments as traveler demand evolves.

On many international flights, there are luxurious first and business classes, and there's economy. Over time, the distinction between first and business classes has become less evident. Some airlines are cutting back or doing away with first class.

A few airlines have been experimenting with premium economy for some time. The notion is attracting broader interest as demand for first class and business class seats declines. United Airlines, for example, says it is removing some first-class seats from Boeing 777s and is adding seats to economy class, mostly in the Economy Plus premium section.

Premium economy can take many forms, said Craver. Some airlines simply increase the "pitch" the distance from one row of seats to the next to provide more leg room. Other carriers have removed one or more seats from a row so that wider seats can be installed. "So maybe now you can give everyone their own armrests," he said.

"And maybe it's not just the physical product." Additional services or privileges, such as early boarding or a free checked bag, might be also part of a premium economy offering.

Added Randy Tinseth, the vice president of marketing for Boeing Commercial Airplanes: "Premium economy isn't just for business travelers 'trading' down. It also appeals to economy-class passengers who value a bit more space."

In any case, the challenge for airlines is to find the right level of service and a price that together keep a given route profitable. If they remove seats to give premium economy passengers more room, fares have to be set to generate the same revenue with fewer seats. How much more an airline can charge for premium economy depends on the route and other factors such as competition and the kinds of airplanes that are in use.

Craver thinks premium economy is most likely to succeed on long-haul international flights using twin-aisle airplanes, because seats can be removed from a widebody configuration with less physical and economic disruption.

The new Boeing 787 Dreamliner, now in flight test, was designed to make this sort of seating change easier. The 787 is the first large transport plane with standardized seat tracks in the passenger cabin floor. No matter which arrangement or seat supplier an airline chooses, there will be no need to tear up the floor and install new tracks in the 787.

The Dreamliner accommodates a standard 3-3-3 economy class arrangement, but airlines can easily change to a 3-2-3 configuration by taking one seat out in the middle. Said Craver: "An eight-abreast premium economy will allow for seats that avoid shoulder contact for more than 99 percent of the flying public."

Boeing works with airlines to plan cabin configurations using a proprietary software tool the company developed, Craver said. Variables such as seat count, fare classes, and physical cabin attributes can be input and changed to see how different combinations affect demand and revenue. Until recently, the software was designed to address the typical first, business, and economy classes. But it's been updated to model the introduction of premium economy.

The market demanded it.

"If you think about where business class is today, it's a far better product than whatever international first class used to be," Craver said. "So there's a huge opportunity again between the different classes of service."