Singapore Airlines has created one of the world's most luxurious airline products. But is that enough to make the six-seat cabin profitable? Perhaps on a few routes. But we're skeptical about others.
The Skift Airline Innovation Report is our weekly newsletter focused on the business of airline innovation. We will look closely at the technological, financial, and design trends at airlines and airports that are driving the next-gen aviation industry.
We will provide insights on need-to-know developments in passenger experience, ancillary services, revenue management, loyalty, technology, marketing, airport innovation, the competitive landscape, startups, and changing passenger behavior. The newsletter, which will pop into your inbox on Wednesdays, will be written and curated by me, and it revolves around the business of airline innovation. We will look closely at the technological, financial, and design trends at airlines and airports that are driving the next-gen aviation industry. You can find previous issues of the newsletter here.
Singapore Airlines unveiled its new suite last week — it looks more like a miniature hotel room than an airplane cabin — and I flew thousands of miles to be there when the curtain dropped.
It’s a nifty product, especially when passengers combine two suites, allowing them to create a double bed. Even the single suite is impressive, as it includes a giant leather seat, and a bed, along with a big television and space for working. Singapore executives say the suite is 60 percent larger than the 2007-era one it replaces, and when it launches next month it will probably be the world’s best, even more opulent than Etihad’s “Apartment.”
But while I was there, I wondered about the new suite’s purpose. Yes, it’s a niche product, only available on the 19 Airbus A380s the airline plans to keep longer-term. And yes, Singapore is shrinking the cabin’s size considerably, from today’s 12 seats to six. Few airlines can sell a dozen first class seats on any route anymore, no matter how impressive the product.
It’s possible, though, that six is too many for most routes, even if Singapore is one of the world’s strongest premium markets.
London might be an exception, given the lengthy flight time from Singapore, and the two cities are major financial centers. New York could be strong, too, but remember this plane doesn’t have the range to make it, and instead must stop in Frankfurt. Soon, Singapore expects to fly nonstop to New York using an A350, so presumably even the wealthiest travelers will prefer saving time over luxury.
Singapore also flies its A380s to other cities where premium cabins usually perform well. But there’s a big difference between selling lots of business class seats, and filling suites with paying customers. Do travelers to places like Sydney, Auckland, Melbourne, Paris and Tokyo need so much space? Will they pay a premium for it? Perhaps certain one-stop routes, where there is no nonstop competition, such as Sydney-Singapore-London, will perform well. But what about everything else?
I’m curious whether this product is less about selling seats than marketing. Singapore wants to be known as a premium airline, and having over-the-top suites presumably helps it cultivate that image, even if the suites don’t make sense for every A380 route.
Perhaps the airline is calculating a passenger will chose its premium economy cabin over a competitor because the traveler saw photographs of the suite on a website. We’ve heard from several airline executives, including one from Singapore, that the “halo effect” can be strong when an airline introduces a luxury product that few will fly.
What do you think? Are Singapore’s new suites a rational commercial response to demand for a premium product? Or is this more of a marketing ploy?
— Brian Sumers, Airline Business Reporter
Aviation This Week
Singapore Airlines Unveils a Massive First-Class Suite to Compete with Gulf Rivals: We expect Singapore’s new first-class suites will be considered among the world’s best products. But the airline still faces intense competition from Gulf and Asian airlines. It’s not clear how much this cabin update will help on that front. This is my story from Singapore.
British Airways CEO Plots Return to a ‘Golden Era’: Newish British Airways CEO Alex Cruz might have discovered he cut too much from the passenger experience, Skift’s Patrick Whyte reports from London. Cruz, who joined British Airways from low-cost airline Vueling, told an audience that the airline’s buy-on-board program on short-haul flights will remain, but that British Airways will be less stingy about feeding passengers on longer routes. Last year, the airline ditched the second meal on many of its shorter North America routes, and the Internet freaked out. British Airways may restore other passenger-friendly amenities, too.
Business Class Must-Haves That Airlines Neglect at Their Peril: Skift contributor Colin Nagy knows long-haul business class. And he argues airlines always must deliver eight items, including a flatbed seat, “thoughtful bedding,” curated entertainment, seamless check in, and Wi-Fi. I agree with all of Nagy’s suggestions except entertainment. I never rely on an airline for content. I always bring my own.
Qatar Air Spends $662 Million on Stake in Cathay Pacific: Given Cathay Pacific’s recent struggles, airline investors had been pushing for a merger with rival (and shareholder) Air China. Qatar Airways’ surprise investment means Cathay’s independence will likely be preserved, at least in the short term. Bloomberg fills us in on what it means.
British Airways Hints at Disrupting Its Loyalty Program in 2018: British Airways may be moving award bookings through its Executive Club to dynamic pricing, shifting the way loyalty program members redeem free tickets. Skift contributor Grant Martin looks at how British Airways may proceed.
The 747 Flies Into the Sunset: United Airlines flew its final Boeing 747-400 flight Tuesday, a special 1970s-themed departure from San Francisco to Honolulu. United is not the final U.S. 747 operator — the honor goes to Delta Air Lines, which will retire its fleet by next month — and it’s far from the last airline in the world flying the humpbacked jet. Korean Air, Lufthansa and Air China all fly relatively new 747-8s, and they’ll be around for years. But, hey, United needed some positive publicity, and this farewell tour is helping. Many reporters have covered United’s 747 retirement, but I enjoyed this CBS piece by Kris Van Cleave more than most.
Air Travelers Resisting the ‘Incredible Shrinking Airline Seat’: Yup. Another article about how profit-hungry airlines are shrinking airline seats, this one in The New York Times. You know how this works. Passengers say they want more space, but when they have a chance to pay for it, most stay in regular coach seats. If travelers want cheap fares — and they do — they need to stop whining and accept that life comes with tradeoffs.
When Hacking an Airline Upgrade Consider a Smile and a Blazer: I don’t buy it, but the Associated Press is giving hope to all passengers who believe they can talk their way into first class by dressing nicely and smiling. Perhaps it happens every now and then, but it must be rare. I feel bad for airport gate agents who will have to say no to every person who reads this article and wears a sport coat in hopes of scoring an upgrade.
This Woman Has Been an American Airlines Flight Attendant for 60 Years: Are you an airline public relations professional? Do you need a ‘can’t miss’ feature story to pitch lazy journalists? Find your longest-tenured flight attendant, and email your favorite reporters. Try to tie it to a time angle, like the person’s 60th anniversary of joining your airline. Then watch the magic happen. Recently, American went with the approach, and it worked. Even Conde Nast Traveler wrote a sweet story about Bette Nash, who “started her career as a flight attendant [when] Dwight D. Eisenhower was president and I Love Lucy was airing its final episodes.”
The Skift Airline Innovation Report is curated by Skift Airline Business Reporter Brian Sumers [[email protected]]. The newsletter is emailed every Wednesday.
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Photo credit: Singapore Airlines last week introduced a new suite for its A380s. But will enough customers buy it? Brian Sumers / Skift