U.S. airlines have gotten their financial houses in significantly better order after decades of red ink. And some carriers are exploring inexpensive ways to make flying economy class a smidge less arduous even though this new wherewithal certainly won’t mean more legroom or free checked bags.
On some long domestic flights gratis snacks are common again and free meals and booze are returning.
Fees for streaming audio and video are even being dropped by a few airlines. By offering cattle class free access to its full menu of in-flight entertainment, American Airlines Group Inc. just matched its two-largest domestic peers.
As carriers sought to boost profits by adding seats and crunching knees, these modest steps follow years of “densification” at the back of the plane. However ever-increasing opulence was courted to travelers at the front of the plane at the same time. Those free movies may be sufficiently engrossing to make you forget the lack of space or your oversized neighbor while a seat-count reduction for the less fortunate isn’t in the cards.
“Even the smallest thing can seem like a big deal. When you’re an abused animal, even a tiny pat on the head can make you feel like you’re loved,” said Henry Harteveldt, a travel analyst at Atmosphere Research Group in San Francisco.
Including $12 billion reported by the 10 largest U.S. carriers in the first half of this year, the improvements are funded by billions of dollars in profits. According to industry trade group Airlines for America, that’s about $700 million more than in the same period last year.
“For the first time since the Great Recession, airlines are finally achieving profit margins on par with the average U.S. corporation,” said John Heimlich, the group’s chief economist.
After years of charging you for snacks, free meals and alcoholic beverages have been restored by Hawaii, American and Delta Air Lines Inc. on their longest routes this year.
Along with the debut in February of a Dutch snack, stroopwafel—which came with a video the carrier produced to show how to eat it, United Continental Holdings Inc. has touted its new premium Italian coffee, from Illy. A craft beer from Goose Island and a more premium single malt scotch, Glenfarclas, is also being stocked since last month.
Hoping to make the experience slightly nicer and as part of an upgraded dining experience in which the airline has divided economy-class meal service into three courses, United has begun serving an additional mid-flight snack on some European routes.
Free food, booze, and films are not the only efforts that are being undertaken o make customers happy. Fees for purchasing a ticket over the phone or at the airport were ditched by Delta in April. Money on nonrefundable tickets would be refunded if the reason is suitably compelling by American, like some others.
“Airlines are taking a look at not just what drives purchases but what drives complaints,” Harteveldt said.
However all that free stuff may not be free at all in the end. Finding a way to stand out from rivals is another factor in the analysis, Harteveldt said. A unique perk might allow carriers to charge a few additional bucks as they are always keen to command higher fares.
(Adapted from Bloomberg)
Categories: Economy & Finance