Will Etihad Airways Eliminate First Class?

Will Etihad Airways Eliminate First Class?

12

If I had to guess, I’d say the answer is “yes.”

Etihad has only five planes with first class

We’ve recently learned that Etihad Airways plans to retire both its Boeing 777s and Airbus A380s. With this update, Etihad Airways will have a total of only five aircraft with first class. The reduction in first class is even greater than you’d assume based on the A380 and 777 retirements, as Etihad also offered first class on some A330s and A340s back in the day.

Etihad’s beautiful A380 first class is history

Going forward, only select Etihad 787s have first class — Etihad has a total of 39 Boeing 787s, and the first five 787-9s delivered have first class, while the rest don’t. Those 787s with first class were delivered through 2015, so it’s clear that even at that point Etihad wasn’t pursuing a strategy of offering first class on its entire long haul fleet.

The five Boeing 787-9s with first class each have eight seats, meaning Etihad’s entire fleet has just 40 first class seats. Suffice to say that at this point, Etihad’s first class fleet is just a small shadow of what it once was.

In the future Etihad’s wide body fleet will consist exclusively of 787s and A350s. While Etihad will take delivery of quite a few 787s and A350s in the coming years, there’s no indication that any of these future deliveries will feature first class.

Etihad’s 787 first class

Etihad’s first class economics don’t make sense

Back in the day Etihad Airways was basically a vanity project for Abu Dhabi, and James Hogan did a fantastic job running it as such (in fairness to him, I think that’s basically what he was tasked to do). The airline was focused on endless and unsustainable growth, as well as executing the most unsuccessful airline investment strategy that we’ve seen in the history of the industry.

Then Etihad introduced a turnaround plan with the goal of cutting losses, and it has been a complete 180. I have to give it to Etihad, the company’s leadership genuinely seems serious about cutting losses, and is making some difficult decisions that would have previously been unimaginable.

In the past I could have totally seen Etihad keeping around first class for “prestige,” but I think the airline would now be happy to cut it if the economics don’t make sense. And I think it’s pretty clear at this point that the economics don’t make sense.

Like everything, there are economies of scale to having a larger fleet with first class, ranging from lounges, to dedicated services, to crew training, to maintenance, to advertising, to catering, to amenities.

Beyond that, the smaller Etihad’s first class footprint, the harder it will be to sell. If first class is only operated in very few markets, people planning first class travel likely won’t even think of Etihad.

There’s simply no way that first class would be profitable with just five planes.

Etihad has a dedicated first class lounge in Abu Dhabi

The directions Etihad could go with first class

The way I view it, Etihad has a few directions it could go:

  • Etihad could continue to have first class on just five planes, and operate these on flights to key destinations where there’s some demand; alternatively the airline could keep the seats but stop offering a dedicated soft product, and just market them as “Business Studio Plus” or something
  • Etihad could remove first class from five 787s, and become a two cabin airline across the board, which seems like the most practical solution
  • Given all the aircraft retirements we’ve seen, Etihad could make the decision to install first class on some future delivery 787s and A350s, recognizing that this is a market that needs to be filled with the A380s being retired

Personally I think we’ll see Etihad just eliminate first class altogether. However, I think a case could also be made for installing a small first class cabin on Etihad’s A350-1000 deliveries, and then using those planes for key destinations, like New York, London, Sydney, etc.

The reason I don’t necessarily think that will happen is because Etihad already has five A350s that are in storage and ready to go. I’d guess these configurations were planned pre-pandemic, and I doubt Etihad wants to spend more money on yet another strategy shift.

So in hindsight it could have maybe made sense for Etihad to keep all 787s in a two cabin configuration and introduce a small, dedicated first class cabin on the A350s. But, you know, hindsight is 20/20.

Could Etihad install first class on some future delivery aircraft?

Bottom line

With A380s and 777s being retired, Etihad will have a total of just five Boeing 787s with first class. Something’s gotta give me — I imagine either Etihad will eliminate first class altogether, or install first class on more future delivery aircraft.

What do you think the future holds for Etihad first class?

Conversations (12)
The comments on this page have not been provided, reviewed, approved or otherwise endorsed by any advertiser, and it is not an advertiser's responsibility to ensure posts and/or questions are answered.
Type your response here.

If you'd like to participate in the discussion, please adhere to our commenting guidelines. Anyone can comment, and your email address will not be published. Register to save your unique username and earn special OMAAT reputation perks!

  1. Azamaraal Diamond

    Abu Dhabi Emirate is the ancestral home of the UAE Aristocracy. EY's F cabin is basically intended to allow them to travel in style. We're looking at the three digit plate Emirati's in this scenario. I think Etihad's parent company runs a private BJ pool for the truly elite.

    So unless the higher level Sheikhs want to travel on another emirate's airline they will probably keep pressure on Etihad to maintain at least F on...

    Abu Dhabi Emirate is the ancestral home of the UAE Aristocracy. EY's F cabin is basically intended to allow them to travel in style. We're looking at the three digit plate Emirati's in this scenario. I think Etihad's parent company runs a private BJ pool for the truly elite.

    So unless the higher level Sheikhs want to travel on another emirate's airline they will probably keep pressure on Etihad to maintain at least F on AUH-european flights and the occasional AUH-JFK. So it might also be enough to return the A380 to the LHR route to compete with EK.

    It will definitely be interesting to watch this scenario unfold. With the recent rebound of fossil fuels (Abu Dhabi is the major owner/producer) it would appear that the cash crisis is over and the good times are about to return. So money of itself will not be a problem going forward.

  2. Uncle Sam Guest

    Companies run their businesses to maximise profits. If anything happens on Air, both those in the 1st class and those in the 7th class will answer by fate.
    Not too many regular customers will ask why if the 1st class is "completely" eliminated.

  3. ekthe Guest

    They can operate 2 classes like TK by eliminating the first class (in the past TK had both first class and premium economy product)and I think right now real 3 big TK,EK and QR

  4. Henry Guest

    I feel like this affects, maybe, a few thousand people worldwide. With that in mind, it's difficult to care very much about this.

  5. glenn t Diamond

    Etihad's main claim to fame is their F product.
    If they eliminate it they run the real risk of being relegated to the 'also-rans', and what Emir of the UAE would want to suffer that ignominy?
    Disclaimer: I have done the A380 EY F a few times and would be super-sad to see it disappear.

  6. Tom Guest

    I have a feeling your guess will be wrong and EY will keep some 787s configured with F to operate on LHR-AUH and/or 1-2 other routes. QR is contemplating doing the same for 777Xs, certain airlines like MH and WY also already do this also with 787s and A350s.

  7. Bob Guest

    @Steve__CC. Disagree. 2009-2011 was the golden era. You could do F RTWs for 120k Aeroplan, including easily available LH/LX F. Award charts for DL were not devalued. And gotta love US and BMI with their geographically challenged agents.

    Revenue fares were low because of financial crisis, fuel dumping was super easy. OPM travel was down making lounges uncrowded.

    As for EY - this is sad - there isnt really any F out there now avaiable...

    @Steve__CC. Disagree. 2009-2011 was the golden era. You could do F RTWs for 120k Aeroplan, including easily available LH/LX F. Award charts for DL were not devalued. And gotta love US and BMI with their geographically challenged agents.

    Revenue fares were low because of financial crisis, fuel dumping was super easy. OPM travel was down making lounges uncrowded.

    As for EY - this is sad - there isnt really any F out there now avaiable with points.
    I can only think of JL/CX/NH, and limited SQ/LH/EK
    I dont count BA as thats not really F.

  8. Endre Member

    Etihad might follow TK’s lead, which successfully operates an impressive C-Class product

  9. Steve_CC Guest

    2016 was peak air travel for our community. New and uncrowded lounges. Cheap fares following oil crash, plenty of miles availability, plenty of first class and a380 routes and some fun 747 routes, TSA precheck and global entry were still so new barely anyone had it. It was a fun time but it really has been all downhill since then still fun but nothing like 2016.

  10. CRAIG Member

    Who are Etihad's primary customers and what are the major differences between them and Emirates (customer wise)? That (like with most businesses) tend to dictate the direction of the company. Etihad will always be a small player compared to Emirates and Qatar so it makes sense to not compete with them directly. I suspect Etihad will financially migrate to a low cost smaller aircraft model while trying to maintain the façade of not being one....

    Who are Etihad's primary customers and what are the major differences between them and Emirates (customer wise)? That (like with most businesses) tend to dictate the direction of the company. Etihad will always be a small player compared to Emirates and Qatar so it makes sense to not compete with them directly. I suspect Etihad will financially migrate to a low cost smaller aircraft model while trying to maintain the façade of not being one. Maybe they will start putting a lot of effort into point to point operations instead of connecting services which are far more competitive.

  11. Evan Guest

    @Lucky - booked for 2 in EY F from IAD - AUH - SEZ for a "round" birthday trip February 2022. Aeroplan award. Would you look to rebook or just let it ride for a period of time?

  12. John K Guest

    Given Emirates' dedication to a first class product, I would be very surprised to see Etihad abandon this product offering and foregoing the 'prestige' to EK. With the A380s still in storage, I believe they are waiting for a turn in travel demand once we get covid under control in key markets.

Featured Comments Most helpful comments ( as chosen by the OMAAT community ).

The comments on this page have not been provided, reviewed, approved or otherwise endorsed by any advertiser, and it is not an advertiser's responsibility to ensure posts and/or questions are answered.

Azamaraal Diamond

Abu Dhabi Emirate is the ancestral home of the UAE Aristocracy. EY's F cabin is basically intended to allow them to travel in style. We're looking at the three digit plate Emirati's in this scenario. I think Etihad's parent company runs a private BJ pool for the truly elite. So unless the higher level Sheikhs want to travel on another emirate's airline they will probably keep pressure on Etihad to maintain at least F on AUH-european flights and the occasional AUH-JFK. So it might also be enough to return the A380 to the LHR route to compete with EK. It will definitely be interesting to watch this scenario unfold. With the recent rebound of fossil fuels (Abu Dhabi is the major owner/producer) it would appear that the cash crisis is over and the good times are about to return. So money of itself will not be a problem going forward.

0
Uncle Sam Guest

Companies run their businesses to maximise profits. If anything happens on Air, both those in the 1st class and those in the 7th class will answer by fate. Not too many regular customers will ask why if the 1st class is "completely" eliminated.

0
ekthe Guest

They can operate 2 classes like TK by eliminating the first class (in the past TK had both first class and premium economy product)and I think right now real 3 big TK,EK and QR

0
Meet Ben Schlappig, OMAAT Founder
5,163,247 Miles Traveled

32,614,600 Words Written

35,045 Posts Published

Keep Exploring OMAAT