Allison Lampert

MONTREAL (Reuters – Airlines are opening airport lounges that offer higher-end service in an effort to attract more premium passengers after the pandemic. In addition, they’re offering VIP experiences to tourists for a small fee.

The COVID-19 crisis saw premium travel plunge, reducing airlines’ ability to charge higher-margin fares. However, traffic is returning in some regions with U.S. bound travel expected to open on Nov 8th. Lounges will be a vital weapon in the airlines’ post-crisis strategies in retaining more profitable customers.

United Airlines inaugurated its first Polaris (NYSE) lounge at Washington Dulles Oct 21. It also announced plans last week to reopen all existing lounges in New York City, Chicago, and Houston by the end-of-the year.

Air France inaugurated a temple dedicated to French design measuring 3,000 square metres in its Paris Charles de Gaulle terminal. Both Air Canada and Dubai’s Emirates plan to upgrade their lounge dining options and services.

Mats Winter is the director of product at Canada’s biggest carrier. He stated that “a lot of the narrative about 2022 will really be around that food programme, how we serve customers and elevating this aspect of the experience.”

Air Canada needs a product that is “competitive” not only for business customers but for all travelers, who account for an increasing percentage of premium-fare purchase.

While the mix might have changed, our dedication to providing a high-quality premium product has not. Winter said that we will be watching closely what traffic is coming into our lounges.

NEW REVENUES

The lounges were designed as an oasis of luxury travelers. They could be used to attract even more people during COVID. Michael Di Corpo (managing director) at Montreal-based IEG software, which manages airport lounges.

Globally, passengers are faced with long lines because of requirements such as proof of vaccination. Many also have longer layovers due to ailing airlines offering fewer direct flights.

Di Corpo spoke of increasing the number of people “paying their way” to generate revenues. He was referring specifically to daily lounge access.

Reuters has found that lounge service revenues are not a major source of revenue for airlines.

Some airlines sold lounge access for passengers in the cabin of their aircraft, but there is increasing pressure to make new sales after the worst economic crisis.

Qatar Airways recently released a Business Lite Fare that is less costly and includes access to a lounge for an additional fee.

American Airlines (NASDAQ 🙂 opened its first Flagship Lounge in September for premium class long-haul passengers. It also made it possible to pay access.

According to a spokesperson, the airline targets people who are traveling for events like reunions and weddings.

However, there are limitations to the democraticization of lounges. These can be investments in excess of millions.

Executives don’t want to be seen as a burden on corporate clients and well-off people who make a profit from trips like the Atlantic. With the U.S. lifting its Nov 8 restrictions for foreigners vaccinated, the Atlantic is now open to all.

American does not offer economy passengers the privilege of accessing its highest-level service. The $150 fee for a Flagship day pass doesn’t grant them access to its private lounge restaurant. The meal comes with food from a different restaurant and is served in a larger space.

United stated that Polaris lounges will remain premium-class only.

Air Canada announced last November that it would open its Maple Leaf lounges for walk-in passengers from the paying economy as well as travelers from other airlines, in order to try out any spare capacity available during COVID-19. The Vancouver practice has been discontinued.

Winter explained that “we don’t wish this to ultimately drive capacity concerns for, for instance, our premium customers.”