In May of this year Etihad unveiled the interior of their A380. They’ll be taking delivery of the first of their 10 whale jets later this year.
Given that roughly a dozen airlines already operate the A380, I wasn’t expecting to see anything revolutionary beyond what we’ve already seen on other A380 operators, like onboard bars and showers.
However, Etihad really innovated, with the introduction of The Residence, which is the first of its kind on a commercial place. It’s a three rooms, 125 square foot suite with a personal butler.
https://www.youtube.com/watch?v=tvnVRoGcJ1w
The concept is brilliant. There’s quite a bit of dead space located at the top of the upper deck of the A380 due to the curvature of the aircraft, so why not install a bedroom and shower up there, and market it as something out of the ordinary?
Etihad’s The Residence bedroom
And that’s exactly what Etihad did. As you might expect, this product comes with a hefty price tag. A one-way fare between Abu Dhabi and London will set you back ~$21,000:
Etihad’s second A380 destination will by Sydney. Want to fly all the way from London to Sydney in The Residence? It’ll cost you a cool ~$40,000 one-way.
There’s no doubt that sounds astronomically expensive, though in fairness up to two people can occupy The Residence for that price, which takes out the sting a little bit… maybe?
So, is The Residence actually selling? Bloomberg ran an interesting story about The Residence yesterday, indicating that it has already been booked for the first 10 flights:
The $20,000 ‘Residence’ suite on Etihad Airways A380 superjumbo, featuring three rooms and a dedicated butler, is already sold out for the initial 10 flights, the Gulf carrier said.
Bookings for the ultra-luxurious cabin boasting a double bed, living area and shower cubicle are running far ahead of the usual 50 percent reservation-rate for first-class berths, Etihad Chief Executive Officer James Hogan said today in Dubai.
“We’ve been quite happy with the takeup,” Hogan said at an industry conference. “There’s a market there.” The price charged for the sole Residence berth on each A380 will cover a one-way, eight-hour trip only, while permitting dual occupancy.
Here’s the video that accompanies the story:
Now, I’m not actually sure I’d judge the success of The Residence based on initial bookings. No doubt there will be a slew of people wanting to try it for the novelty, but will it actually sell long term?
I see no reason it couldn’t. There are many levels of “super rich” — there are those that can afford to pay for international first class, those that can afford to pay for private jets, and then those that are somewhere inbetween.
Even if Etihad doesn’t always sell The Residence, they won’t be taking much of a loss on it. It’s not really different than just having an empty first class seat, given that the bedroom and shower aren’t in an area where they’d otherwise be generating revenue.
And let’s be honest, pride and competitiveness is as important as profit to some Gulf carriers, and this product certainly helps in that “battle.”
I can’t wait to try Etihad’s A380 First Apartment on the inaugural flight between Abu Dhabi and London later this year!
Do you think there’s a market for The Residence long term?
Who bought the 1st ticket on #TheResidence?
The top 1% spending this kind of money is nothing for them. If they chartered a private jet and flew that same route it would cost much more than that I would imagine.
I would think price would come down in the future. Weren't the SQ A380 flights more expensive when it first came out? I remember reading about it and thought I'd never be able to fly on it cause of the price. Well I did get to but it was on points.
people are buying $20MM apartments here in nyc as simple investments. $40k RT is chump change to an increasing number of people worldwide. wish it wasn't so but it is.
$20k or $40k is peanuts for big hitters. If you make $10 mil a year (which isn't really even that crazy) or just over $800k per month, maybe $400k after taxes, taking this a couple of times a year won't hurt you at all.
I wonder if the tickets are fully flexible. The people that would normally be spending that sort of cash on a ticket would have very fluid schedules so I would not be at all surprised if they just booked the residence for 2-3 consecutive days and just cancelled the ones that weren't needed, last minute.
@ Vik -- While you can change tickets for free, they're not fully refundable. Here are the fare rules:
"20% of fare value 30 days before dep
50% of fare value 29-7 days before dep
75% of fare value 6-3 days before dep
100% of fare value within 2 days of dep"
So even if you refund 30+ days before departure, you still only get 80% of the fare refunded.
@De
$40k is from London...
@lantean, it's $40k each way for the syd flight.
i meant to say is NOT all that expensive...
i actually think AUH-SYD is all that expensive for $20k... it's $10k pp for a super unique experience. if i had a boyfriend i would actually consider this, maybe for a honeymoon or something.
I also wonder whether a good number of those bookings were award bookings. I'm sure there are a few Etihad Guest gold elites who have over 2 million miles to burn. ;)
@ Joey -- Could be, though if I had to guess I'd say there are lots more people with too much cash than with too many miles in that part of the world.
Wow, this is so extravagant! If someone takes you as their guest would you agree to look at them longingly like the guy at 0.40 seconds? ;-)
Did you look at expertflyer to see whether the first 10 bookings were indeed sold out?
@ Joey -- ExpertFlyer doesn't actually show the Residence fare code, but from trying to do "dummy" bookings, it does indeed appear so.
Now, despite the fact that you want to emphasize the price, what is the lowest price one can get The Residence for, such as ex-CAI or ex-CMB, etc...
@ Abdel Rahim Abdallah -- I haven't found a ticket in the Residence from anywhere for less than $20,000.