U.S. airlines have shifted their strategy towards high-end travel post-pandemic to enhance profits and mitigate economic risks. This approach has proven effective, with premium seat sales holding steady despite declining overall travel. Delta Air Lines reported a 5% rise in premium ticket revenue and a significant margin gap compared to main cabin revenue, while United Airlines saw a 5.6% increase in premium revenue. Demand for premium travel remains strong, driven by affluent customers, even amid financial market fluctuations and economic uncertainties impacting less affluent travelers.
Delta Air Lines last week reported a 5% year-on-year jump in its second-quarter premium ticket revenue, compared to a 5% decline in main cabin revenue.
United Airlines' premium revenue rose 5.6% in the June quarter from a year ago, mitigating the financial hit from operational constraints at Newark airport.
Premium capacity remains resilient, as attributed by airline executives to the healthy financial conditions of U.S. households with earnings of $100,000.
Our core consumer is in good shape and continues to prioritize travel, according to Delta CEO Ed Bastian.
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