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Premium Traffic Waaaaaaay Down: Continental RASM Drops 19%

How bad is the front cabin for US airlines?  This bad:  Continental revealed in its March numbers that its RASM (revenue per available seat mile – a rough gauge of average fare) dropped 19% in March over last year.  While coach fares have certainly been lower, it’s the front cabin that would contribute to drops of that magnitude.

This is hardly a sign of impending doom – they’ve stripped a ton of cost out of the system (along with lower fuel prices), but it shows how much the high-end business traveler has disappeared from the skies.  Couple that with Continental’s strong international presence, and the large dropoff in people paying $6,000 to fly in C to Tokyo starts to add up.

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  1. Yeah, this is the only way the numbers could add up. Note that load factors — especially domestic ones — are pretty decent.

    You would think we’re going to see some draw down in transatlantic flights next fall. Outside of summer, the only way all these flights are sustainable is on the premium cabin.

    Note that int’l traffic is not as slow as the media might make it seem. If you go to the airport, everything will look “normal.” Due to weather, I had to change flights at the last minute on a transatlantic itinerary last week, and I had a very hard time finding ANY other flight with availability. I was booked in coach, and was moved over to Lufthansa. They had to upgrade me to biz class because they had no coach seats available. On a 747 no less. So I don’t believe the world is ending.

  2. Nice upgrade :)

    They’ve been giving away coach seats on TATL for next to nothing, so load factors are looking OK.

    Not sure about the drawdown on TATL in the fall — oddly enough, the biz class cabins are difficult to fill up during the summer (when biz travel slows) but pick up again in the fall. Continental (unlike Delta) hasn’t really changed up their TATL service — I expect a reduction in cities (they can’t all be working well, can they?)

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