Yesterday I posted about American announcing a premium economy product on some of their longhaul aircraft, which will begin rolling out late next year. It looks like a solid product as far as premium economy cabins go, and will feature both more spacious seats and improved amenities.
On one hand I think it’s a smart move from the airline’s perspective, though at some point you have to wonder if they’re segmenting the market too much. On their 777-300ERs, American will have First Class, Business Class, Premium Economy, Main Cabin Extra, and Main Cabin. That’s a lot of options!
My primary concern with premium economy is if American only allows one cabin upgrades. This means that it’s most likely that you’ll only be able to upgrade from economy to premium economy, or from premium economy to business class. Given how much more expensive premium economy can be than economy class, this is potentially terrible news for frequent flyers.
Economy vs. premium economy cost on British Airways
Executive Platinum members are already going from eight systemwide upgrades to four systemwide upgrades per year, so could you imagine if those continued to only be useful for a one cabin upgrade? Going from eight business class upgrades to four premium economy upgrades per year would certainly sting (though given the state of the industry, also wouldn’t surprise me).
Since yesterday people have been sending me screenshots of interactions they’ve had with American about how upgrades will work with the introduction of premium economy, and are really reading into what they’re saying. But here’s the reality — American doesn’t even know how upgrades will work when premium economy is introduced.
Why? Because American was rushed in announcing premium economy, since they knew Delta was working on a similar product offering (which I’d speculate will be announced tomorrow, but we’ll see). They wanted to beat Delta to the punch in announcing the product, though I think they still want to follow Delta’s lead as far as policies go. After all, in the US airline industry Delta leads the way, and then the others follow.
Now Delta is rushing to introduce their premium economy product, since they didn’t expect American to introduce it so quickly. Delta will likely also announce premium economy in a rush, meaning they might not publish upgrade policies right away either.
The moral of the story is that Delta will likely set the precedent with how upgrades work when premium economy is introduced, and American will follow. Based on all the sources I have, American truly doesn’t know what they’re going to do yet.
How could this end up? It might be worth looking at how American’s two biggest joint venture partners (probably the motivation for American introducing premium economy) do it:
- British Airways only allows one cabin upgrades, so you can upgrade from economy to premium economy or from premium economy to business class, but not from economy to business class
- Qantas does let you upgrade from economy to business class and skip premium economy, though they charge an obscene number of miles, and upgrade priority is given to those who are booked in premium economy
In theory I suppose it’s possible that Delta and American introduce separate “business class” upgrade certificates and “premium economy” upgrade certificates, though I wouldn’t count on it. My money would be on upgrades being one cabin, though maybe they’ll try something creative. A few possibilities include:
- Allowing you to double upgrade using two systemwide upgrades
- Allowing you to upgrade economy to business class using substantially more miles than were previously required
- Issuing special upgrade certificates at some mileage threshold which are good for a double upgrade
Bottom line
The moral of the story is that American really doesn’t know what they’re going to do with international upgrades. They hurried to beat Delta in announcing the new product, and most likely will follow Delta’s lead when it comes to the upgrade policy.
How do you see upgrades working out with the introduction of premium economy?
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