Why Is There No All-Business-Class Jet Service Within the U.S.?

I was in Canada much of last week, and happened to run into an off-duty Air Canada pilot. I had flown Air Canada a few times in the previous days, and told him that the experience was significantly better than on any U.S. airline. He grimaced. “Oh, it’s terrible for us, too,” he said. Then he talked about all the ways in which flying has become so much more unpleasant, even for pilots, in recent years — overcrowded planes, impossible schedules, unpleasant conditions, etc.

So I asked him, if he were king for a day, what’s the first thing he’d do to improve Air Canada?

“That’s easy,” he said. “Change the class of the people who fly.”

We both laughed, but he wasn’t kidding. His complaint was that airline fares have gotten so cheap that there’s simply not enough revenue being generated to run an airline as it should be run, leaving everyone — employees included — pretty unhappy. (For further evidence of airline employee dissatisfication dissatisfaction, see the articles on this subject in today’s New York Times and Wall Street Journal.)

All of which made me wonder: Why is there no all-business-class jet service within the U.S.? Eos Airlines, Maxjet, and Silverjet thought it worthwhile to start all-business-class New York-to-London service at fares well below the typical business class ticket. What would happen if a U.S. airline, startup or otherwise, offered all-business-class service between, say, 10 or 20 U.S. cities including N.Y.C., Chicago, Washington, L.A., Dallas, San Francisco, Miami, Boston, Atlanta, etc.?

I find it hard to believe that there aren’t enough customers to fill those planes in a heartbeat. For all I know, there may be regulations that stand in the way. Or perhaps someone is building such an airline as I type. Steven Udvar-Hazy would surely know.

If so, I know a pilot in Canada who is ready to be your Employee No. 1.


I may be mistaken, but I suspect there wouldn't be as large a market for all-business class service (at higher than current market fares) as you might think.

Most of the potential flyers would be business people flying to meet clients, transact business, and so on. And most of those people either operate under corporate policies that require coach-class travel or bill their travel costs to clients who require the same (although paying for upgrades using your own money or frequent flyer points is generally acceptable).

For instance, I used to work for a very large corporation, where we had travel rules that specified that most flights within the U.S. had to be booked as coach class, but that flights over a certain length (6 hours? 8 hours? I don't remember) or overseas could be booked as business class. In my jobs working for an engineering contractor and a law firm, it has been made clear that our clients do not pay for anything better than coach class. Rules like these may provide an explanation for the existence of a business-class-only market for transatlantic travel but the lack of a similar market for domestic flights.



There is something pretty close Midwest Airlines, they have all first class seating and until all airlines stopped serving free food, they had nice meals as well and free drinks. They were started out of the fleet used for Kimberly-Clark executives.


A couple of points

First, I don't know if they are still in business, but Midwest Express use to offer "One Class" service that was essentially a business class throughout the plane concept. However, I think I had heard that they were recently bought but I'm not clear on the details.

Second, corporate travel policies may give a transatlantic all-business-class airline an advantage that a similar domestic model wouldn't have. Many companies allow employees traveling on business to fly business class only on extended trips (i.e. flights of more than five or six hours). These kind of policies would necessarily limit the pool of available customers for premium domestic airlines with shorter routes.


Surely the low cost of air fares is the market reacting to the influx in low cost competition that has increased in the years, forcing the industry to what may be considered allocative efficiency.

Albiet the price of flights is arguably not reflective of the social cost with global warming becoming an increasing worry, surely we limit the mobility of the population by increasing the price they must bear.

However with reference to the point you actually make,
Maybe the demand to fill an entire flight, and every flight with consumers willing to pay more than they need to - as surely most are willing to accept getting from A to B quickly regardless of the luxuries.


I flew Midwest Express about a year ago and it was delightful. Business class throughout, a very tasty snack (warm breadsticks w/choice of dipping sauce), and warm chocolate chip cookies!

That said, it wouldn't surprise me if they have gone under or discontinued that level of service - my ticket was only around $300.


Ya know whut? That pilot can just shove it up his fanjet. He wants to change the class of passengers?
Well whoop-de-doo.
Anybody that has to deal with the public would like to do the same.
He's making a helluva lot more than the flight attendants, gate agents, check in agents and all the others that have to really take the crap so he can leave on time.


For domestic flights, I suspect some would be more interested in improved services off the plane than on. I'll pay more for saving time but I don't care about leg room on a 2 hour flight. For example:
-Gate bravo-1, not bravo-100
-Faster baggage processing
-Shorter ticket lines
-Don't blame the weather when it's bright and sunny out here and your are bringing the plane from city A, the pilots from city B, and the flight attendants from city C and one of those other cities has bad weather (yes, true story). I call that bad logistics.

Startups would probably not be able to do this (especially gate assignments) but perhaps an existing carrier could spin something off.


As someone who works for one of the mentioned one-class airlines, a little insight (although I am but a menial worker and not involved in strategy):

New York - London is a very big market for business class travelers. Some people are willing to spend several thousand dollars to get a nice seat. The fact that the eastbound trip is almost always an overnight trip adds to the allure of plenty of space to recline so you can sleep. A shorter, domestic flight (less likely to be a redeye as well) is more comfortable to do sitting up the whole time.

That said, I know my airline is looking to expand eventually to include domestic flights. But the income we need to get profitable will come more quickly from trans-atlantic flights right now. And profitability is what it's all about at the end of the day.


Major U.S. carriers are hurting because their organizations have been and continue to be top-heavy both in structure and pay scale. Their diverse fleets also require more maintenance expertise. The "lowering" of the class of typical airline passengers only exposed problems that were there all along. The only "new" problem is that several major airports (cough O'Hare cough) can't handle the increased demand of air travel.


"dissatisfication"? Great word!!


The problem with the all business class airline is that there would probably not be enough passengers to both fill the airplanes and offer lots of departure and arrival times. New York to London might be ok with just a few departure times at each end.


Canada's population would make it the 2nd largest state after California. Would a business class airline work in California? If it could carve out a niche, like from a business airport near SF to a business airport near LA? If it could offer enough schedule options? If it could fend off competition from the larger airlines that provide business class seating along with coach?

If you try to expand that idea to, for example, flights between specific business centers like Chicago and NY or Dallas and Atlanta, do you then run into a different level of competition? After all, if you have routes within an area, you also limit your competition to those airlines which fly the same or very similar routes there. Move to the US and now you're competing with a lot more options. That, I think, is the rub.


What about Jet Blue? I know it isn't the exact same, but all leather seats, personal TV screens, wider seats, etc. At first Jet Blue offered really low prices. Now they're charging more than Southwest, who was their main competitor, and are still filling planes. It seems like the employees are happy. I am biased just because I love flying with them so much. When Southwest would give me a small bag of peanuts, JetBlue would bring a huge tray by with options saying "Take anything you'd like." Small things - big difference. Their marketing at least claimed to try and give first class service to everyone. It's not first class, but it's nice.


United has a premium SF/LA to NY service.


Next time you are flying in Canada do what Canadians do and fly Westjet!! Better seats, friendlier service, and they don't loose your luggage. It may not be business class but it's not as awful as Air Canada.



Midwest Express is in business, they just changed their name to Midwest Airlines. A typical fare from Milwaukee to KC is about $170, and that is with 2 across leather seats and those cookies.

Unfortunately, AirTran (the cattle-car in the sky) is attempting a hostile takeover of Midwest. In response, Midwest has set up www.savethecookie.com to generate support for the company.


Some years back an airline called MGM Grand Air offered all business- (or possibly first-) class service on transcontinental flights. It didn't last long.


The US airline industry is also heavily regulated, unionised and a political minefield. Non US citizens can't set up such a scheme (see debacle over Virgin US) and the legacy carriers would almost certainly try and wipe out any significant competition which took the cream of their customers.

Another reason may be that there is a very well developed private airline industry - i'm thinking of NetJet and equivalents which i believe are much more affordable in the US than elsewhere.

Another reason? Well the US has developed to have many powerful cities. You'd need a big network to gain loyal customers who could fly to all their major destinations. In my experience, many execs choose a carrier with a nearby hub then try to stick with them wherever possible. To set up a business class airline which simultaneously covers all major cities would be very expensive.


I doubt that a startup would have the scale necessary to service business travelers domestically, who demand that carriers have many scheduling options, to accommodate their busy lifestyles. They demand flexibility, which is what the legacy carriers, regardless of their level of service, provide. If I'm a business traveler, I want to be able to, say, take a Chicago-NYC flight at whatever time I want because I know that if I miss the 3 pm departure, there will be a 5 pm. A limited business class airline cannot replace the convenience provided by the legacy carriers domestically.

I agree, however, that opportunities exist in the international marketplace.


It surprises me that noone has mentioned the new air taxis using VLJs. (http://www.businessweek.com/smallbiz/content/sep2005/sb20050916_272956.htm)

As others have mentioned between regulations, terminal costs, maintenance cost and customer base large planes are unlikely to be profitable. However by utilizing regional airports and smaller planes (requiring less maintenance and crew) there is greater potential for profitability.