Luxury air travel: Out of the blue, into the red

NEW YORK Fri Jun 4, 2010 9:32am EDT

OpenSkies Airline Senior Flight Officer Andy Pomeroy walks down the aisle of one of its Boeing 757-200 jets that features 84 business class seats only cabins in Dulles, Virginia, March 24, 2010. REUTERS/Hyungwon Kang

OpenSkies Airline Senior Flight Officer Andy Pomeroy walks down the aisle of one of its Boeing 757-200 jets that features 84 business class seats only cabins in Dulles, Virginia, March 24, 2010.

Credit: Reuters/Hyungwon Kang

NEW YORK (Reuters Life!) - The economic downturn has clipped the wings of luxury air travel.

Hi-end boutique airlines have fallen from the sky, business travelers are bargain hunting online and most folks seated in the front of the plane have paid only for the back, experts say.

"Luxury air travel has essentially been grounded," said Peter Yesawich, CEO of the travel marketing company Ypartnership, "One of the first prerequisites to go in a tough economy."

Yesawich, whose company tracks travel trends, said that with the exception of long hauls, these days even most folks in first class are flying on upgrades.

"It's said that real profit in any flight is front of plane. The rest covers the overhead," he explained. "But there's been a conscious effort by corporations and individuals to suppress that travel."

Airlines are also battling the price transparency that the internet has revealed.

"A couple of clicks on kayak.com, for example, shops airfares even for business class," Yesawich explained.

He said big carriers, such as Delta and British Airways, are trying to lure business travelers back to first class with amenities such as onboard showers, flat seats for sleeping and Internet access.

But the high-end boutique airlines that sprang up in the boom before the bust have mostly gone the way of the Dodo bird, or the Concord. Now most boutique airlines are low cost and no-frills.

"Eos is no longer in business and L'Avion was gobbled up by British Airways," said Steve Loucks, vice president at Travel Leaders, of two boutiques that ferried passengers in high style during high times.

So how do the rich get around these days? It depends on what you call rich.

"The super rich fly anyway they want," said Mike Weingart of Travel Leaders in Houston, Texas.

In Glendale, California, his colleague Vicky Voll agrees: "Business people, retired executives, film stars, some own private planes. Amazingly for long haul flights, they choose scheduled airlines in first or even business class."

It there are eight to 10 people traveling together they usually charter a small Gulfstream, she added.

According to Jami Counter, senior director of TripAdvisor.com, today's luxury traveler inclines toward private jets, or at least a piece of one.

"What's been in vogue is fractional jet ownership," which Counter likened to a time share. "It's flexible. You can tap into it, so it's a nice alternative to owning a jet."

For scheduled flights up where the air is rarefied, he cites the double-decker, wide-bodied Airbus 380, which has been flying commercially since 2007.

"Emirates out of Dubai, with 100 destinations around the world, has 50 Airbus 380s on order," he said, adding that they boast showers in first class, spas and private suites.

Counter says the luxury boutiques are like canaries in the economic coal mine.

"In 2000 Legend Airlines announced an incredibly high-end, 59-seat business class service out of Dallas. Then came the dot.com downturn and Legend lasted less than a year," he said.

"Every time airlines go in for this high-end luxury service, it's a sign things are getting overheated."

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