Business Travel - Are you sitting comfortably?

Only two or three years ago, airlines were spending huge sums of money on upgrading services on the ground and in the air. And as we enter the 21st century, another raft of expensive improvements has been announced by the major carriers, against a climate of companies asking executives to trade down their class of travel and sacrifice flexibility. Although there is excess capacity on transatlantic routes which is driving fares down, overall, according to the American Express Corporate Travel Index, for the third quarter of 1999 UK business-class fares increased by 1% quarter on quarter respectively, and were up by 9% over a two-year period ending third quarter 1999. And companies should brace themselves for another wave of business class fare increases across the board. Company travel policies have long restricted employees to economy class travel for short-haul flights, allowing travel in business class only on longer flights. In fact, according to the OAG Business Travel Lifestyle survey, organisations are far more likely to restrict the class of air travel than the choice of airline. And the determination to keep expenditure down by insisting on economy class travel has been compounded by the recent rises in fares: ‘Companies are taking a tougher, more directive approach, and are downgrading, or insisting their executives purchase tickets with less flexibility, to rein in spiralling travel costs,’ says American Express manager of consulting services (Europe) Matthew David. And leisure fares are going down, not least because of the increasing attraction of secondary airports (saving time) and the impact of low-cost carriers, which has resulted in a decrease of between 9% and 14% over the past two years. So why should carriers begin spending millions of pounds on improving cabin conditions – largely in business and first class – at a time when they are unlikely to recoup the cost? The answer, as ever, is competition. ‘The airline that stands still and does not continue to develop its product, is the airline that loses ground against competitors. If you take your eye off the ball, you are done for,’ says Paul Moore, a spokesman for Virgin Atlantic. With this is mind, the airline is embarking on a £37m relaunch of its upper class service including a flexible meal service and new seating, colours and lighting. The crux of the refit is the seat, which converts into a 6ft 8in bed. And Virgin is looking at the possibility of introducing double beds, making the chance of joining the mile-high club a far less challenging proposition. British Airways was the first airline to instal beds in first class in 1995 and, since then, beds have been the standard to aspire to. Once one carrier has done something to ensure it stands out from the crowd, the others must follow suit or lose out. As part of a £6bn programme announced with the infamous change of logo in 1997, British Airways is spending £314m on a new Club World long-haul business class, and £50m on Club Europe. Part of this will see the introduction of beds in business class in special self-contained units allowing passengers some blissful seclusion. Air France revamped and renamed its cabins in 1997 to include seats that recline by up to 180 degrees in first class and 127 degrees in business class, and is asking passengers what further changes they would like to see. Improvements will be implemented within the next two years. Lufthansa has also spent serious money – more than £120m – on long-haul services worldwide. In business class, seat pitch is extended, angle of recline improved and eating arrangements are more flexible. Economy class passengers often lose out in these refits. However, Lufthansa has installed new seats with increased recline and adjustable headrests, and Virgin’s premium economy and economy classes will be spruced up and refurbished in line with the airline’s new livery, with a view to a relaunch in some 18 months. And as part of an ongoing £150m refit of economy class, BA is installing better seats (half the fleet to be completed by April), and individual seatback television screens. Swissair has redesigned its first class cabins, installing what it claims to be the largest bed in the sky; and has backed this with other cabin upgrades, including improved legroom in business class and a choice of menus in economy. As services are upgraded, so items that were exclusively supplied in the exalted realms of first class, are spread throughout the cabin and become standard fare. For example, some carriers are already putting beds in business class (Virgin, BA); and where individual screens and phones used to be a prerogative of executive cabins, they are now largely standard in economy. According to William Gaillard, director of corporate communications for the International Air Transport Association (IATA): ‘Before the industry was in open competition, the airlines could discuss their products and provide the same things. ‘Now they compete on price, punctuality, service, seats, everything: once a leading airline upgrades, a competitor’s best shot is to pit a new seat against a new seat. They have no choice. But there is a cost associated with providing more legroom.’ IATA undertakes regular surveys on behalf of airlines to find out what business class passengers want – such as more entertainment, a better seat, lighter meals. ‘Space and punctuality are always at the top,’ says Gaillard. Space is, in fact, the outstanding focus of the current refits, with a minimum of 60in seat pitch becoming standard, along with personal videos backed by well-stocked libraries, laptop power points in seats and, in many cases, flexible meal service – eat what you want, when you want. And Delta Air Lines, American Airlines, Swissair, Emirates and Singapore Airlines are all offering interactive entertainment and/or information. Emirates launched a new livery last year on its first Boeing 777-300, the first change of corporate identity in its 14-year history. The airline has also put in a new, spacious first class seat with a privacy hood over the head rest on its Airbus A330-200s, which marks the re-introduction of first class for the popular London Gatwick-Dubai service. Personal video cassette players are given to first and business-class passengers, and both have access to a video library. Pacific carriers have also put a lot of money into smartening their cabins and honing service. Air New Zealand installed fully reclining sleeper seats (80in pitch) in 1998 as part of a £23m refit, along with personal video viewers and video library. And Qantas reconfigured its international jet fleet to the tune of more than A$250m two years ago. First class benefited from sleeper seats, adjustable headrest, and larger toilets with improved lighting. Business class passengers were also given a new, more versatile seat, and economy class was upgraded with ergonomically designed seats and wings on headrests. Meanwhile, Far East carriers reflect the regaining of economic confidence in their upgrades and refurbishments. Cathay Pacific Airways has relaunched first class with, it claims, the widest sleeper seat in the sky. Economy class passengers are also benefiting from an upgrade, including personal TVs. Says Cathay Pacific’s product manager Sarah Blomfield: ‘As an airline in a highly competitive industry, we must continually invest in our product, even during difficult times.’ Far East-based Singapore Airlines announced a S$500m makeover for their fleet of aircraft in all three cabins, which took effect last year. In first class, a capacity of 16 was reduced to 12 sleeper seats (78in pitch). There are eight singles and two pairs. Raffles (business) class seats have adjustable headrest and a privacy screen, a world first in executive class. Economy class passengers now enjoy adjustable headrests and new seats with footrests. And the adjustments continue: SIA has upgraded its personal video system at a cost of US$1.3m per aircraft, allowing passengers to start and stop listening or viewing when they like, and then return to the same point. ‘In spite of the impending gloom prevailing a year or two ago in respect of the economies of South East Asia, the region has put itself well on the road to recovery through prompt and strenuous efforts,’ says Gerry Stevens, sales & marketing manager UK & Ireland. The hottest competition is across the Atlantic, where spare capacity has been transferred from Asian routes. With the introduction of the Airbus A330-300 and A340-300, Air Canada has upgraded its Executive First seats, which have head rest controls. Air Canada recently acquired Canadian Airlines. It will be running the two as separate identities but will be streamlining route services. Canadian Airlines launched a new logo last year, and with it improvements that include: seat pitch increased to 60in and laptop power in seats in business and economy, making the carrier the world’s first to extend the service to economy. Passengers on American Airlines B777s and Airbus A300s have laptop points, and those on B767s and MD11s have individual videos, which are to be replaced with built-in personal units, as on other aircraft. A US$314m investment in Delta Air Lines’ BusinessElite service has seen the introduction of a two-class service, dispensing with first class. Seats have 160 degree recline, and with redesigned seatback to allow greater privacy. And United has also announced a revamp of its first class cabin, introducing a sleeper seat with phone that allows data transmission. Seats will be in herringbone format to allow greater privacy. With seat pitch increasing to 60in upwards, beds beginning to creep into business class, and technology allowing ever greater services, airlines will be increasingly hard pressed to think up new and wondrous features and services with which to attract passengers. And it is dispiriting for innovators that as soon as they do, a competitor will be hot on their heels to emulate their style. But individuals and corporations pay for these luxuries – they are hard earned, and at least at the moment, the customer is king – if at a royal price. – Catherine Chetwynd is a freelance journalist WEBSITES Air Canada www.aircanada.ca Air France www.airfrance.com Air New Zealand www.airnz.com American Airlines www.aa.com British Airways www.britishairways.com Canadian Airlines www.cdnair.ca Cathay Pacific www.cathaypacific.com Delta Air Lines www.deltaairlines.com Emirates www.emiratesairline.com Lufthansa www.lufthansa.com Singapore Airlines www.singapore.com Swissair www.swissair.co.uk Qantas www.qantas.com United Airlines www.ual.com Virgin Atlantic www.virgin-atlantic.com.