alt Hacker NewsThis was the bit that caught my eye:
> Blake’s pitch to airlines is enticing: “You’re already flying this route with a 300-seat plane where 80+ people in business class generate most of your profit. Give those passengers a supersonic plane, cut the flight time in half, and charge the same price.”
And now most of the profit for the 300-seater is gone. What does this do to flight pricing for those who were flying economy?
Replies
Yup, it's a bad pitch. Let's say the economy airplane without the business seats can now accommodate 400 economy seats. You now need two air crews and twice as much maintenance (or more) to transport 480 people (~60% increase) with a smaller percentage of those passengers being business class fares.
What really kills this though is the value proposition for the business class passengers. I think I'd rather pay extra to sit in a comfortable seat for 16 hours, where wifi is now a standard feature, than cram into a smaller (likely noisier) seat for 8 hours. The cases where that 8 hours matters - especially when you can work from the seat if you have to - are fleetingly few. In the 70s, you couldn't do much in an airplane seat so it was wasted time. This is no longer the case and is steadily getting better.
Most being the operating word here. Economy class tickets still make a profit if the airline wants it, just see the vast majority of regional flights which have zero business class seats. Southwest for instance has single-class layouts.
Some airlines "take" the marginal economy seat loss on larger planes because those are the ones they can fill with business class seats and make an even larger profit.
Even then it's a complex math on whether economy is hurting those flights' profit margins since those people buy things in-flight such as Wi-Fi and extra bags. Base fare is not the only way airlines make money.