EY turned undesirable space into revenue yielding space. As long as The Residences get booked on the same frequency as the rest of their F cabins, they are laughing, all the way to the bank.
They just have to make more money than selling 2 F tickets on each sector. Given that F is $10k for LHR
, they need half the occupancy of F to break even on revenue.
They'll be making bank on this.
And you can bet there will be odd very loyal F customer spontaneously upgraded to The Residence, which should work well for retaining regular F class pax.
I fully expect EK
will follow suit with similar ideas.
From a pax perspective, 2X the price of an F tix per pax is not that much for people who can afford it, especially given the enhanced privacy. It's only crazy expensive to us regular folk. To the private jet crowd, this is way more comfortable space than their own aircraft at a fraction of the price. Would $40 000 get a Citation from SYD
? And how many stops would it have to make? That's the competition.
|Quoting rampbro (Reply 37):|
To me, the Residence product is the difference between owning a Citation/Lear and a G6/Global Express, or just owning a Citation/Lear.
Exactly. There's huge differences even within the private jet club. How many can afford to own and service an aircraft with global reach? The Residences split the difference. The privacy and comfort of your Citation. The global reach you can't afford. The only tradeoff is convenience. You leave when the airline is scheduled, not at your convenience.
[Edited 2014-11-12 14:35:00]