It’s on many people’s bucket lists and a must for those who absolutely need a good night’s sleep before a crucial meeting in NYC or performance in Paris. But why is the popularity of premium travel soaring so much at present?

The growing number of retrofits and increased prioritisation of first class cabins aboard wide-body planes, along with a rise in ticket sales, suggests premium travel has never seen such demand. But who is responsible?

Studies suggest a new generation of luxury-seekers, the 'Next Set', are embracing a YOLO (you only live once) way of living following the hardships of the pandemic. Certainly, social media plays a large part in influencing behaviour. And don’t forget that global spending power continues to grow – particularly among the middle classes in China, India and other growth economies.

How commercial aviation started as a class above

Before we try to understand why more passengers are seeking premium travel experiences, let’s take a look at the history. It might be logical to presume that ‘Economy Class’ came before ‘First Class’, but in truth it was a mix of both in the early days of commercial air travel.

Flying was a luxury only the very rich could afford – a typical pre-WWII ticket cost half the price of a new car – but it was far from lavish. In the days before ozone converters, aircraft flew at much lower altitudes, where air resistance is far stronger and the ride a lot bumpier.

There was no such thing as a pressurised cabin, so it got mighty noisy, breezy and chilly: when the crew told you to strap in, it meant for the whole flight, not the ascent. And takeoff was so deafening, it was only 10 decibels short of causing pain and hearing loss. Passengers were handed mini-megaphones so they could be heard above the din, one of a number of accessories handed out by air stewardesses (a fixture since 1930) to appease passengers: the birth of premium travel perks.

How Business Class ate into First Class's territory

Post WWII, flying remained exclusive to the rich – the term ‘Jet Set’ can be traced to the early 1950s – but prices became more affordable thanks to increased governmental regulation, starting in the US. Airlines competed according to the level of service they could offer passengers. The 1950s ended up being a pivotal decade for commercial air travel – in 1955, two different classes (First and Coach) emerged on TWA flights and quickly caught on; and in 1957, airlines displaced ocean liners as the preferred means of crossing the Atlantic.

The origins of 'Business Class' can be traced to 1978. While First Class on a wide-body jet typically consisted of rows of four seats (2-2), compared to ten in Economy/Coach Class (3-4-3), Business Class added three more seats (2-3-2), but still managed to retain most of the luxury. By the 1990s, Business Class, with its more affordable prices and comparable luxuries – for example, convertible lie-flat seats that enabled passengers to sleep horizontally – had started to displace First Class on most airlines.

Clearly to have a future, First Class needed to distinguish itself again to appeal to the very rich, and the answer came with bigger planes like the A380 launched in 2007.

The extra space enabled airlines to offer passengers their own suites, enabling the kind of privacy they could enjoy in private jets. High-end suites on some airlines are known to come with a dedicated bedroom, lounge and even a private shower.

The reasons why passengers seek premium travel experiences

Premium travel has been in revival mode since the pandemic for a number of reasons:

Prices were discounted during periods of restricted travel, introducing more passengers to the experience
During the restrictions, there was the added appeal of taking a seat free of the close proximity of other passengers
In many countries it was impossible to fly, meaning many travellers had extra money to spend once the restrictions were lifted
The pandemic amplified YOLO attitudes – most notably among Generations Y and Z (those born post-1981 and 1996). Increased spending on luxuries and experiences bucks behaviour trends of Baby Boomers and Generation X (those born post-1945 and 1964) seen during previous economic downturns, say economists
Social media is a strong influence on human behaviour

Premium air travel is not the only extravagance that has thrived, as across the board luxury brands – from Rolls-Royce and Chanel to Louis Vuitton and Prada – have been experiencing record sales. Again, it is a "surging performance without parallel", according to one report, which identifies the pandemic, and the uncertainty it introduced into many people’s lives, as a turning point for luxury consumption, going as far to call it a "renaissance".

They were retiring their A380s. Now they're retrofitting them

In light of the increased demand for premium travel, many major airlines are retrofitting the Business Class and First Class areas on their wide body jets to heighten the experience.

This is particularly true of the A380. Several years ago, many airlines were planning to retire the world's biggest passenger jet – in line with their focus on narrow body jets. But now they are busy retrofitting them instead.

Leading the way is Emirates with a $2 billion retrofit program to revamp 67 of its 116 A380s. It had previously identified 2032 as their last year of service, but now forecasts many of the A380s will still be flying in the 2040s. British Airways, Singapore Airlines and Lufthansa are also all retrofitting their A380s.

US airlines on course for 50 percent growth in premium seats

Since 2020, major US airlines have increased their premium seat numbers by 25-75 percent on medium and long-haul services.

For example, United Airlines has increased its premium seating capacity by 25 percent since 2019 – growth that will reach 75 percent by 2026, the same year by which American Airlines intends to add 45 percent to all long-haul flights. And Delta has set itself a goal of deriving 37 percent of its revenue from premium seats – up from 35 percent currently. As part of its plan, economy seat revenue would fall from 44 to 40 percent.

Clearly the airlines want to capitalise on the demand for premium seats, but how far are they prepared to go? Could one of them end up offering a service on which all the seats are premium?

Heard about the exclusively premium class service?

As is often the case with transport innovation, major operators like to first observe how startups fare in new markets.

One such startup is French boutique airline La Compagnie, which primarily offers flights from Paris-Orly to Newark (other services fly from Nice and Milan) on which all 72 seats are Business Class.

The model enables La Compagnie to offer much cheaper Business Class prices than comparable services: between $1,731 and 2,606, compared to $3,400-3,800.

Passengers praise the La Compagnie service for its fast-track security access, high-quality waiting lounges, quick boarding and disembarkation, and spacious luggage bins.

The choice of routes – linking the US to high-end European cities – is of paramount importance. It’s telling that an early La Compagnie route, to Luton in the UK, was short-lived.

Overall, detractors don’t think the La Compagnie model is scalable as it doesn't integrate with major airline networks or rewards programmes, but Forbes suggests a major airline could iron out these creases, offer a select number of premium-only flights and capitalise.

TAKEAWAY

Not only is luxury air travel booming, but it is diversifying. Startups like La Compagnie are filling niches hitherto unexplored by the major airlines, opening up new avenues for the market to grow. None of this would be possible without the growing demand from passengers – and free from the shackles of the pandemic the Next Set are keener than ever to sample the pleasures of the Jet Set.

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