Days after Delta Air Lines confirmed plans to introduce a “basic” business class product, United Airlines has again confirmed it is looking at doing the same thing. Will basic business revolutionize business class or simply mark an easy way to add restrictions to some premium cabin tickets, much like the cheapest economy class tickets?
United Airlines Moves Closer To Unbundling Business Class: Here’s What “Basic” Business Class Will Mean For You
During this week’s 2025 Q2 earnings call, Dawn Gilbertston of The Wall Street Journal asked United’s Chief Commercial Officer, Andrew Nocella, about whether United is “weighing barebones business class tickets?” (“like your new favorite brand loyal competitor”). Nocella responded:
Look, what I would say is over time, over the last seven or eight years, we’ve leaned heavily into segmentation of our revenues, which is really in our articulate way of saying, providing more and more choices to our customers so they can pick the
experience they would like from premium to basic economy. And we have learned through that time period that our customers really appreciate this.
Not everybody wants the full experience. Some people want other experiences. And so the value to United as an airline and to that of our customers has been proven by the segmentation of revenues that we’ve done. And we look forward to continuing to diversify our revenue base and segment it in the appropriate way, and I’ll leave it at that.
I asked the same question to Andrew Nocella at a United Airlines event in Brooklyn, NY a couple months ago and received the same response…
The answer is yes…this is coming.
Should we be fearful? Is United (and Delta) going to turn the business class experience upside down with stiff change fees and seat assignment fees and no lounge access?
Yep…that’s what I am guessing.
What Basic Business Class Might Look Like On United Airlines
The good news is that I cannot imagine a situation where the onboard product is different based on which fare class you buy. Everyone will be treated equally well (or equally poorly) onboard. “Basic” business class passengers will still enjoy the same seat, bedding, food, drinks, IFE, and other amenities.
But the ground product is a different story.
Priority check-in? Nope, though if any benefit survives, this one will.
Complimentary checked baggage? Nope. Or maybe one bag at 50 pounds instead of two bags at 70 pounds.
Lounge access? Nope.
Also, while the onboard product will be identical for all passengers, basic business class passengers will have to pay for pre-assigned seating, something British Airways has done for years.
And perhaps worst of all, I think these fares will not only be non-refundable, but also non-changeable or at least carry a high change fee.
In the case of United, it currently has premium cabin fares ranging from P – D – C – J…with P being the cheapest. I buy P fares, with transcontinental fares running $500-600 one-way.
But I can imagine P fares becoming basic fares and no longer being flexible. When it comes to intercontinental travel, we need only look at United’s joint venture partner Lufthansa. Already, Lufthansa Group carriers charge change fees of $400+ on premium cabin fares…that will surely come for United too.
Finding The Right Balance
I love playing armchair CEO and one thing that critics of this move have said is that United and Delta may be leaving a lot of money on the table by doing this. So often, people buy premium cabin tickets with “OPM” (other people’s money). The argument goes that employers will pay for these extra services whether they are used or not, so why not charge them for it instead of offering a cheaper business class product that companies will buy for employees?
I think that premise is false, because United won’t be sacrificing revenue at all. Instead, just like with basic economy, the cheapest tickets will suddenly have restrictions…it’s not like business class tickets will suddenly become cheaper. Nope, the cheapest ones will just be a lot more restricted than they currently are.
So an employer who needs flexibility will just pay more for the same thing…
I think where this might adversely impact revenue might be on travelers like me who buy premium cabin tickets for personal trips…I change and cancel trips all the time and I greatly value the elimination of change fees. For that reason, I avoid basic economy tickets. If United introduces basic business class tickets, I’ll avoid those too. But rather than paying $800 one-way instead of $550 one-way for a trip, I’ll just fly economy…
CONCLUSION
There’s little doubt in my mind that Delta and United…followed by American Airlines…will unveil a basic business class fare later this year or next year. It won’t be good for consumers, it won’t lead to cheaper tickets, but it will certainly be a revenue generator for the airlines. Enjoy free seat assignments and other perks of business class while they last…
Will basic business class impact the way you purchase airline tickets?
> Read More:Delta Moves To Unbundle Business Class, Tests “Basic” Premium Cabin Fares
I’m assuming that other than non-cancellations or fee for changes – 1K will override all the other aspects like lounge access (But will it mean United Club instead of Polaris?), bag fees, seat reservations etc.
One big potential negative repercussion is that if these fares are fairly attractive it will make Plus Points even harder to use.
Could they go full basic business, such as board last, no rollaboard carry on, no free checked baggage, no food or drinks, assigned seating only at check in, no changes or refunds, no Mileage Plus credit or only 1 mile per dollar, no lounge access, no amenity kit, blanket and pillow with a fee, etc.??? Basically a seat, personal item, and access to the lavatory.
they could do what Delta has done and also provide an enhanced service as well
Maybe a business plus that includes UC access or even Polaris Lounge access?
Maybe a premium plus plus that includes domestic F, like what Delta has done?
They could have a basic business yet also have an enhanced one
“I want to order the five course dinner, but I’m only really interested in the bread and salad.”
CEO’s who think we’re that stupid to not see through their fare increases deserve to be launched into space and left there!
Race to the bottom?
Business class ala Spirit/Allegiant model?
Eventually, everything on the plane will be separately monetized. Seat? $60. Recline? $2. IFE? $4. Drink and snack? $6. Lav? $5. Carry-on?$30. Basically instead of a $107 one way you’ll only see $60. If airlines can properly price every piece, they can become slightly less reliant on the banks to provide them with their margins.
@ Matthew — I cannot imagine ever buying a non-refundable, non-changeable Polaris fare. Maybe if United would be willing to pay me a change fee when they change their schedule…
I’m not either – it’s why the Etihad program is anathema to me. I simply will not consider it.
Delta and United must be careful here…
Why not just run a tab like in a bar ? Initially get a deposit on the pax credit card and simply tally every nickel & dime consumed/used on the flight and, voila ! With AI & biometrics they can even monetize trips to the loo and charge
by the minute and/or quantity deposited in the toilet, similarly with non-potable water used from the tap…
Seems like the airlines are on a never ending quest to ruin the air travel experience as they race to the bottom.
Hi Matthew, when was the last time you paid $500-600, P fare for a transcon biz UA flight? Do you mean for PE (premium economy) for that price range? Thanks.
I am on one right now. I also was on a lie flat seat on the west coast to east coast leg.
“But rather than paying $800 one-way instead of $550 one-way for a trip, I’ll just fly economy…”
Now THAT will be the end of an epoch!!! Matt consistently flying economy. Oh, how the mighty have fallen (no sarcasm! You truly have been a connoisseur of fine aircraft experiences.
“It won’t be good for consumers, it won’t lead to cheaper tickets, but it will certainly be a revenue generator for the airlines.”
This is what we consider peak capitalism: Even as efficiencies improve, people work harder, prices are raised or benefits cut, the wealthy make more money but it doesn’t “trickle down”.
I observed the same with the “solution” to lounge crowding: Build more lounges or expand? Naw: Just increase prices to drive down demand. Win-win: The lounges are accessible again and the golfing CEO’s “make” even more money. Nice work, if you can get it.
That said, Matt makes the interesting observation that the goal here is to somehow cut services and/or increase prices while still selling the “full” tickets to business travelers whose expense accounts require flexibility or last-minute travel. That’s always been the case.
“Priority check-in? Nope, though if any benefit survives, this one will.”
Chuckling because most of us check-in online anyway and if there’s no free checked bag, what’s the point? Just walk through security with your mobile pass and to the gate.
Lounge access? Not required for many businesses who want the flex tickets/last-minute fares. It also solves the problem of lounge overcrowding (see above). This will be the first to go since it’s a twofer problem solver.
I chuckle in that a “basic” business class fare or walk-up/last minute will result in what we saw back in the 1980’s: Business class passengers subsidizing the cattle class and even sitting in the middle seat because they walked up and paid 4X the fare of everyone else.
I grow weary of airlines screwing over passengers rather than trying to draw more business through a clearly superior product or loyalty program. This is just more proof that there’s been too much consolidation in our airline industry.
It’s not just the consolidation, but also demand: They raise prices and lower services because they CAN as populations increase despite low birth rates settling into the same cities.
Consider how Hershey, Orlando, and even Hollywood were cities built from the literal ground-up as intentional industry leaders. They didn’t exist until some entrepreneur with a gleam in his eye thought: “Why pay high rents when I have sufficient infrastructure needs to just build my own?” It’s like buying a car instead of renting one.
Today, our immigrants and businesses build onto the same tired and crowded landscape despite billions of acres of land elsewhere. Bill Gates, Bezos, and Musk didn’t build new cities nor did they provide jobs to Americans. Young people now get to fight for jobs to live in high rent areas before they are pushed out in 5 years or the job outsourced anyway.
This is bigger than lousy conditions for modern elite fliers sadly.
My wife remembers the fall fo the USSR. I am getting the same vibe now.
I recall the fall of the USSR as well. I was in Berlin when the wall was up and my stepdad happened to be there when the wall actually came down. He got some pieces although later generations thought it was fake. Anyway, the reasons the USSR collapsed and the self-sabotage the USA is doing are not really equivalent although we’re gonna hurt from the insanely stupid decisions we’re making now. In contrast a command economy where The Kremlin says that X province needs to grow X amount of wheat or whatever was a pure recipe for failure and fail it did.
There’s a Polish film you and your stepdad may appreciate: “What will you do when you catch me?” It’s a casual romp through the follies of Polish communist society mixing farce with situational humor. If often quote the head mechanic’s statement on customer service response time to IT professionals. One line in particular was an attempt to estimate production output:
“According to the official estimate, 1,000,000 Rubles”
“Ok, according to our internal studies, half that.”
“For real? Who knows?”
The situation with the states is quite different, of course, but I get a “vibe”.
I hadn’t realised the business on Untied was anything but basic.
As you won’t be alone in switching away from the front cabin due to the introduction of the new fare types, their aspiration to charge higher fares will not materialise. Lufthansa often sell business basic from Europe to NBO and back for €1200 all-in, and that’s just a limited flexibility ticket which includes all the usual business class services. Good luck finding a US-based carrier which will sell you 16 hours in fully flat seats for that amount, or any carrier anywhere in the world that can do it while offering full flexibility.
If UA could charge more for the sum of the parts of their J product, they’d be doing it already with the all-in prices. The effect of this change won’t be to make the airline a huge amount of extra money, but to enable better price discrimination between those who need the flexibility (mostly because they’re travelling for work) and those that don’t (I know premium leisure travellers who usually book their trips months ahead and never make any changes).
They scream that it gives users choice but we all know its just a way to raise fares/revenue without advertising. Basic Economy fares cost the same as regular economy circa 2018/2019 but don’t come with all the other features. Now if you want all the features you’ll be forced to pay for what they used to include for free.
Hmmm… so let’s see: UA food in Polaris is pretty abysmal as is, service is OK (FAs are great but overworked), lounges are crowded and pretty basic (yes, even the Polaris ones) so I’m not sure what would distinguish Premium Business v Basic Business. If the expectation is corporate travelers are going to fill the Premium seats, think again kids… corporate travel managers arent going to go for the premium seats for their employees which leaves Polaris travelers like me who fly for pleasure (as are the majority especially to leisure destinations like Tahiti, Hawaii, the Caribbean and most of UA’s new European destinations, e.g., Palma, tourist heavy Italian cities like Venice or Palermo, etc. It seems like a good way to drive away your loyal Polaris and First independent travelers or fly yoour planes w/o Premium pax.