The reason that air travel in coach isn’t as luxurious as it was 50 years ago is because of deregulation. Air travel is much less expensive. Planes are full – and the number one determinant of a pleasant flight in back is whether you have an empty seat next to you. Airlines don’t operate with the high margins they did when government prevented them from competing with each other on price. As a result they don’t invest in luxurious food to lure travelers away from competitors, since they weren’t allowed us use low prices.
There’s more to the story than that – there were real innovations like all-business class Legend Airlines (itself a creature of regulatory arbitrage) and Midwest Airlines didn’t stop serving cookies until long after deregulation – but it’s the basic explanation, and any story about changes in air travel that fails to explain how air travel changed in the absence of the Civil Aeronautics Board which acted to prevent ‘ruinous competition’ but which failed in many ways to do this is doing readers a disservice.
Jennifer Billock purports to offer a history of different classes of service in aviation at The Points Guy. She promises to explain why inflight experiences have gotten worse, and a history of different products. Only she doesn’t offer an explanation of why and many of the details in her history are wrong.
Why Coach Travel Is No Longer Luxurious
Billock begins by saying all travel used to be great, and now it’s rotten, and promises to explain why it all changed. Nevermind that some things have improved for everyone – affordability, safety, inflight entertainment (even when you have to stream it yourself) and internet for instance. And nevermind that she actually charts an improvement in premium cabins.
One area where there’s been a real decline in economy class is food (although airline food used to be the butt of late night comdedian jokes) and in some cases seat pitch.
The golden age of flying in the 1950s and 60s was all glitz and glamour, full of gourmet meals, copious drinks, enough leg room to stretch out, and enough cigarette smoke to create a dreamy haze to reminisce through. Everyone was treated like a star.
Now, you’re lucky if the person in front of you doesn’t slam their chair down onto your knees while the person behind you has their bare feet propped up next to your head. And don’t get us started on the state of airline food.
So what happened? How did we go from first-class glam for everyone to the often less-than-spectacular cabins inside planes today?
The problem here is despite asking what happened, and asking how we went from “first class glam for everyone” to where we are today, she never actually tells us. In fact the words “Airline Deregulation Act” don’t appear anywhere in the piece. Here’s why it was a major driver of change:
- The airline industry got its own regulatory agency coming out of the Air Mail Scandal. Government regulated where airlines could fly and what prices they could charge.
- Prices were kept high. Government’s role was viewed as ensuring profitability of airlines.
- While government acted to prevent competition (until the last years of the Civil Aeronautics Board under Chairman John Robson ‘experimented’ with price competition, allowing Texas International Airlines “peanuts fares” and American Airlines super savers among others), that didn’t actually stop competition. When each marginal passenger was profitable, airlines competed for those passengers.
- Since airlines couldn’t compete on price, they competed on amenities. Congress, in its oversight of the Civil Aeronautics Board, even discussed at one time whether they needed to regulate the thickness of sandwiches to prevent this sort of competition.
Deregulation lowered prices and made air traffic more accessible, but meant that airlines weren’t competing over the same margins.
Of course – given regulatory capture – it’s easy to see why Ms. Billock confuses the Civil Aeronautics Board with an industry group (“In 1952, airline groups (the CAB domestically and International Air Transport Association abroad) began allowing multi-fare flights, combining a standard class and the coach class with lower service.”).
I’m Not Sure Her History Of Cabins Is Right, Either
Besides believing that the Civil Aeronautics Board, a U.S. government regulatory agency created during the Roosevelt administration, was an industry trade association responsible for permitting the sale of multiple classes of service she also attributes rising oil prices in the 1950s through 1970s as a cause of change in the airline experience. Oil prices were stable and even declining slightly in inflation-adjusted terms until 1973.
The 50s to the 70s saw the introduction of safer planes and room for even more passengers, but also higher operating costs thanks to increasing oil prices.
Although she says “seats were even more packed in to make up for the deficit” caused by higher fuel prices, she also suggests that larger aircraft during this period actually “increase[d] service offerings for each class.” In the narrative perhaps these two effects cancel out because though she suggests airlines squeezed in more seats, but also increased service, that – while there were improvements in premium cabins – “economy stayed the same.”
This history though seems off:
In the 90s, some airlines (like Delta and Continental) began to merge business and first class seats in order to make the expensive offerings even more appealing to passengers. This meant the introduction of yet another class — premium economy — that midrange passengers could use, sandwiched between economy and business.
Delta BusinessElite and Continental BusinessFirst did not ‘mean[..] the introduction of..premium economy.” Continental never offered a premium economy product. Delta didn’t introduce premium economy until 2017.
In 1992 Continental got rid of first class and introduced better seats in business, increased pitch by 15″ and upgraded dining. Their earlier business seats were like premium economy seats today. They upgraded their cabins over just a six month time period.
In the early 2000s, business class officially surpassed first class. British Airways started it by launching the first fully lie-flat bed. American, Northwest, Continental, Delta, and United didn’t want to be out done, so they followed suit. The race to claim those wealthy customers led to even more improvements, like suites with privacy, sliding doors, larger in-seat entertainment systems, and now even entire apartments with en-suite bathrooms and showers inside planes.
Business class did not “surpass[..] first class” and certainly did not do so “officially.” However business class seats eventually surpassed seats that were once offered in first class. In 2000 British Airways began rolling out a flat bed seat in business class, but it didn’t feature first class soft product and first class improved too.
And it’s not correct to say that all the U.S. airlines followed suit – United didn’t start installing flat beds in business class until 2008, American didn’t have its first flat bed business seat until 2013.
Furthermore the suggestion that “suites with privacy, sliding doors” came after this (but then how can business class have surpassed first class?) fails to realize that as far back as 1950 United Airlines offered a private state room on board its Boeing 377 Stratocruisers.
The Future Of Air Travel Is Less Commoditized
When customers search for air travel, they’re presented mostly with schedule and price and so make their purchase decision based largely on schedule and price (although British Airways research shows that brand influences purchase decisions, too).
Increasingly however airlines will be providing information about the full travel experience that will be used as customers compare their flight options. A new standard is being developed and deployed by the industry-owned fare distribution firm ATPCO which will let customers understand everything from seat type, to meals, to lounge access and internet speed.
That supports greater product differentiation – which is the opposite of Billock’s hope when she concludes, “Hey, maybe posh business class seats will edge out everything, and we’ll finally enter into a new golden age of air travel.”