Drawback coach? Your dollars mean less to Delta Air Lines than they used to.
The economy class cottage is generating about 48 percent of Delta’s revenue, down from 63 percent six years ago, Delta told investors on Thursday. While trainer is still the largest source of the airline’s revenue, the share of revenue generated from premium cabins like win initially and business class has nearly doubled to about 32 percent. Revenue from Delta’s co-branded credit plans with American Express has also climbed.
“The margin that we get on all those products are substantially higher than the comprehensive system average,” CEO Ed Bastian said at Thursday’s investor day, referring to premium cabins. The second-largest U.S. airline is investing more in its sparse seating, adding suites with closing doors at the front of planes used for international flights.
Business go spending in the U.S. last year increased 3 percent to $292 billion, and will likely expand around 4 percent past the next five years, according to the Global Business Travel Association, an industry group.
Delta is reaping the aids of that robust corporate travel demand and a strategy of selling seats at the front of the plane, instead of offering them as untouched by upgrades.
The carrier used to sell about 13 percent of its first-class seats and now sells 60 percent, Delta’s president, Glen Hauenstein, declared during an earnings call in October.