Flying coach? Your dollars mean less to Delta Air Lines than they used to.
The economy class cabin generates about 48 percent of Delta's revenue, down from 63 percent Six years ago, Delta told investors on Thursday. While the coach is still the largest source of the airline's revenue, the share of revenue generated from premium cabins like first and business class has almost doubled to about 32 percent. Revenue from Delta's co-branded credit cards with American Express have also climbed.
"The margin that we get on all those products is significantly higher than the overall system average," CEO Ed Bastian said at Thursday's investor day, referring to premium cabins. Airline is investing more in its premium seating, adding suites with closing doors at the front of flights used for international flights.
Business travel spending in the US last year increased 3 percent to $ 292 billion, and will likely expand around 4 percent over the next five years, according to the Global Business Travel Association, an industry group.
Delta is reaping the benefits of that robust corporate travel demand and a strategy of selling seats at the front of the plane, instead of
The carrier used to sell about 1[ads1]3 percent of its first-class seats and now sells 60 percent, Delta's president, Glen Hauenstein, said during an earning call in October.