American is the First US Airline to Introduce True Premium Economy, But Others Will Likely Follow

In the last decade, it’s been incredibly rare to hear about American being first, but this is a different American these days. Yesterday, the airline announced it would add a true premium economy section to its international fleet. This isn’t innovative on a global scale, but within the US, American is the first. What American is rolling out now might have been called a great business class years ago, but times have changed. Business class has gone so upmarket that it left room for a new cabin to come in and fill the gap. That’s what we have here, and I bet we see others follow what has already become standard elsewhere in the world.

Before we get into the strategy, let’s look at the seat, shall we?

American Premium Economy

Looks pretty nice to me, though this is a bit misleading. That nice leg rest is only in the first row. Rows behind have foot rests that drop down from the seat in front. Unlike extra legroom seating (American’s Main Cabin Extra, United’s Economy Plus, and Delta’s Comfort+) which is just coach with some more space at your feet and a couple of frills, premium economy is a whole different class of service. As you can see here, the seats are very different from regular economy. They’re wider, have leg rests, and have substantial armrests with storage and power in them. Meals are upgraded, you get priority boarding, etc.

For those who are used to flying European and Asian airlines, this won’t look like anything revolutionary. Premium economy took hold years ago with some carriers, and others (like, most recently, Singapore) have been racing to add the cabin. But in North America, Air Canada has been the only airline to really put forth a true premium economy offering. The airline has been really happy with it, so it was always surprising to see American carriers shun the product.

The Evolution of Airline Cabins
If you think about the evolution of classes of service, then this move makes a great deal of sense. Many years ago, the difference between first class and coach was more about service than anything else. Yes there was more personal space as well, but for the most part it wasn’t how we think of first class today. As coach continued to get squeezed, first class got better and better. It got to a point where airlines realized there was an opportunity for something to wedge in between, and that’s when business class cabins were born. Just take a look at the Continuum of AwesomenessTM for a visual representation.

Continuum of Awesomeness

Over the the last decade, first class has gone more upscale to the point where most airlines that have widespread first class products have created suites with physical walls. At the same time, business class has been a race to see who could install the best flat bed with direct aisle access. Business class has become so good that first class has become obsolete for many airlines. On the lower end, however, coach is still coach and the product has been stripped down further over the years.

Fifteen years ago, United stumbled onto the idea of Economy Plus. But it wasn’t for about 5 years that United realized people would be willing to pay more to sit in those extra legroom seats. This served as a good enhancement to coach, but the gap between coach and business continued to widen. American is simply following in the footsteps of international airlines in seeing the need for a true premium economy to fill the gap. What was once economy, business, and first is now economy, premium economy, and business.

As international carriers have learned, providing something closer to economy than business in price will allow economy travelers to upgrade without breaking the bank. It will also prevent most business class passengers from downgrading because the product difference is still enormous. (Couldn’t have said that with American’s old torturous angled flat beds.)

The Roll-out Schedule
American will start rolling this out next year when it takes delivery of its 787-9s, but it’s going to take a long three years before the roll-out is done. While regular coach is 3-3-3 across on that airplane, premium economy will be 2-3-2. This will also roll out to the 787-8s, A330s, A350s, and 777s. In other words, it’s the entire long haul fleet except for the 757s and 767s. With the roll-out taking so long, those 767s may be gone by then. Main Cabin Extra will stay on all these aircraft as well. That means the 777-300ER will have 5 different product offerings: First, Business, Premium Economy, Main Cabin Extra, and Main Cabin. That’s a lot to choose from.

Are you wondering why this isn’t going on the domestic fleet? It’s because it’s already there. These types of seats look a whole lot like domestic first class with a leg rest. This resemblance isn’t lost on many. When Delta rebranded its cabins, the rumor was that it would roll out a true premium economy and then change domestic first class to be premium economy as well. That hasn’t happened, but it would certainly make sense if it did. Product consistency is key, and nomenclature matters for setting expectations.

Many have assumed Delta had designs on adding a true premium economy product at some point, and I wonder if this might just accelerate those plans. Then if Delta does it, United is bound to follow.

I personally think it can’t come soon enough. A successful, modern, global airline should be all about providing a variety of choices to cater to different passenger needs. There has been a very big gap in the US carriers’ product offerings for some time, and it only continues to widen. This helps to fill it.

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34 Comments on "American is the First US Airline to Introduce True Premium Economy, But Others Will Likely Follow"

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AJ
Member

Can’t believe it’s taken US airlines this long to get on the premium economy bandwagon – here in the Asia Pacific region it’s old school (SQ notwithstanding). People will pay for premium, particularly on long haul; even
leisure travelers if they’re going more than 4 hours (or thereabouts). I expect AA will see good returns once it’s finally implemented.

PS: Love the Continuum of Awesomeness.

Gary Leff
Guest
“Many have assumed Delta had designs on adding a true premium economy product at some point, and I wonder if this might just accelerate those plans.” In fact one credible rumor over the past week was that Delta was on the verge of adding premium economy which is why American moved up their announcement, to get ahead of Delta. Much in American’s announcement seemed rushed. They don’t have answers on some of the soft product details like meals (I’ve heard informally about 3 meal choices, a dessert choice, but nothing official yet) and they don’t have answers on how this… Read more »
bhamric
Member

Gary, I suspect you’re accurate. I would say that DL will now move up its timeline as well.

Josh G
Member

Interesting AA is the first mover here but was the last of the major network carriers to install extra-legroom Y section (standalone USAIR didn’t of course)

A
Guest
What I want to know is the price point for these seats and how easy will it be to move up to these with status? When pricing international flights I’ve been astonished at how much airlines charge for the lame economy plus. 4″ of legroom isn’t worth $400 on a BOS-LHR roundtrip. It’s as if the airlines are doing what they used to do with domestic F where it was priced so ridiculously high that only a fool would pay that and instead they gave the seats away to their elites. My hunch is that’s their strategy here. Give away… Read more »
Orcair
Guest

Air Canada usually charges about 2x the lowest economy fare for Premium Economy, however, there are often sales where Premium Economy is the same price/less than a Flex fare (mid-level economy fare). Air Canada requires upgrade credits to go from Economy to Premium Economy, and I imagine that AA will follow that philosophy. It also stops elites from upgrading straight into Business Class…

AAflyerORD
Guest

As a Chicago-based flyer, this is great news! I’ve long avoided AA metal over the ocean as I’m frequently in the back of the plane and BA and Finnair offer much better coach products. I’m not in the position to routinely pay $5,000 for a flight to Europe but would gladly pony up an extra $500-$800 for a true premium economy offering. Unfortunately, as most of AA’s transatlantic fleet seems to reside at O’Hare, it might a few years before I get to enjoy this.

Zack Rules
Guest

Very interesting, pity they weren’t more imaginative with the name, AdvantagEconomy anyone? On the 77W’s, the Main Cabin Extra seats are already slightly wider because they’re 9 across instead of 10 across. I wonder where they’ll take away seats? Business, coach? Or do anyway with first?

HovA
Guest

Love it!!! I’m curious to see how points upgrades will be organized in this new lineup.
And was hoping to see where economy plus fell on the continuum of awesomeness :)

David SF eastbay
Member

Could just be the photo, but those seats don’t look comfortable to me. They look hard and boxy.

jaybru
Member
Pardon my skepticism, but you say this is “…all about providing a variety of choices to cater to different passenger needs.” I would submit it probably is more about marketing manipulation and deception, more ways to pick your pocket. Of course, airlines should be able to do whatever they think will keep them competitive and make money. But, why stop with just 5 classes of service, First, Business, Premium Economy, Main Cabin Extra, and Main Cabin. Just preface everything with “premium,” and add on “extra,” use a hundred other synonyms for “premium,” and the marketing departments can have a field… Read more »
jeff
Member

Sure there is marketing-speak in the labels, but excluding Y+ there are significant product differentiation between Y/W/J/F that’s a legitimate choice at different price points. There is real value in that for consumers and the airline (in revenue management) so I’m with cranky on this being good for all.

On the upgrades I’d hope AA does an option to upgrade from Y->W and Y&W->J where pax booked in W would have the higher priority into J without fully blocking access to J from the back

Eric C
Guest

Any chance we’ll ever see a 2-3 configuration on a 3-3 narrowbody? The extra 2.5″ width per passenger would be fantastic. If I’m paying for an extra 1/5th of a seat, I’d much rather pay for it in width than length.

Bob
Guest

That’s what she said

Nick Barnard
Member

I read elsewhere that the argument against this is the aisle jags needed to make it happen take up too much space. (You’d have two, one from FC to PE then one back to E+) since the aisle would not be in the center.

Darkwater
Guest

Gulf Air used to have that setup on its A320s: 4-wide “F”, 5-wide “J”, 6-wide “Y”. It looked odd, as the third J seat jutted out into the aisle between the two balanced first and economy sections.

Vinay
Guest

“Continuum of Awesomeness”–another great Cranky-ism! I’m going to have to use that for some of my presentations!!

Richard
Member

CF,
Are you sure the back rows won’t have the extending foot rest? Doesn’t make sense to buy 2 different seats for the same cabin. Maybe the extension foot rest works when the seat reclines and the seat back rests are available when the passenger does not want to recline?

Nick Barnard
Member

It’s standard practice that bulkhead seats are a different variation of the seat that goes behind it. Usually the only difference is the tray table in the arm rest area, but it’s still different.

StevefromCVG
Guest

Doesn’t solve the problem if your company refuses to pay more than the cheapest seat on the plane. If the out of pocket isn’t too high or miles for upgrade isn’t too high, it sounds like a win.

I may start flying AA to build miles for international upgrades.

Maarten Albarda
Member

I flew an AA B777 last night from JFK to LHR. I was upgraded to Main Cabin Extra. It wasn’t those new prem econ seats, but they were 2-3-2 seats that were different from economy: wider, more legroom and – obviously – a less cramped seat it (and slept!).

southbay flier
Guest

It would be funny if DL announces it next week and then completes the installation before AA. Three years is a long time for not that many planes.

Andrew mondt
Member

This is good news from AA for a change but hardly earth shattering. AA had three cabin international aircraft for years. I see it as a relaunch of a “Business Class” product under the name of “Premium Economy”. AA has only ever allowed upgrades to the next cabin. You won’t be able to go from Steerage to Business Class. I’m sure a lot of corporate travel managers are going to be rethinking travel policies.

marks
Guest
ORDFlyer312
Member

I am just happy to see some great news coming from our U.S. carriers. Seems to have been a positive news week. Looking forward to more.

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