Airlines Will Make Billions By Selling Cheap, 'Basic Economy' Seats
Your cheap-ish ticket is making big bucks for airlines.
We recently told you about the imminent Basic Economy class coming to all major airlines, including United’s “no-frills fare.”
Turns out, these Spartan seats with little in the way of luxury (and by little, we mean nothing) may be more affordable than standard Coach, but the airlines are raking in huge profits.
By 2018, United’s new seating initiative could earn the airline an extra $3.1 billion in operating income, Reuters reported today. After all, USA Today noted Delta Air Lines banked an additional $20 million in revenue one quarter alone.
American, eager to reap the rewards of Basic Economy, also announced plans to begin selling stripped-down fares.
Like Delta’s cheaper-than-economy class, United’s cheaper tickets may come at the expense of an advanced seat assignment or the ability to make changes to your itinerary.
And while the changes may always be derided as "last class" and "economy-minus," the benefits for the average traveler are not hard to figure out. Many people want the best deal, and now they have access to bargain-barrel fares on airlines with extensive route networks.
Still, it's probably not just a widening customer base earning legacy carriers such large profits. Sure, United and Delta could be snapping up travelers from budget airlines such as Frontier and Spirit, but they’re also going to be grossing dividends every time one of those travelers in “economy minus” has to pay for a checked bag, a packet of peanuts, or even a bottle of drinking water.
Melanie Lieberman is the Assistant Digital Editor at Travel + Leisure. Follow her on Twitter and Instagram at @melanietaryn.